Introduction

Documents obtained by Sudan In The News reveal that over 760 attacks on Sudan’s oil fields during the transitional period have caused oil production to fall by a third. Whistle-blowers in Sudan’s oil industry revealed that the military intentionally neglected securing oil fields in order to exacerbate the fuel shortages, which provided justification for the 25 October 2021 coup.

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Part 1: Investigative findings

1. Background: As Sudan’s perpetual economic woes continue to inflict widespread suffering on an impoverished population, Sudan In The News has unravelled the full extent of a cover-up that shows how avoidable this crisis could have been, alongside how its continuation proved beneficial for the coup regime. A major contributor to the economic crisis are continually rising fuel prices that culminate in soaring inflation and cost-of-living, making conditions increasingly difficult even for Sudan’s middle-class citizens - let alone the 47% of Sudanese citizens who live in poverty.

2. The civilian plan to increase oil production: This investigation indicates that the fuel and economic crises could have been mitigated if the civilian component of the pre-coup transitional government successfully enacted its plans to harness Sudan’s oil production potential and redistribute the profits towards public development and the national economy.

3. Attacks on oil fields: However, the civilians were unable to implement their plans to increase oil production due to the hidden war in Sudan’s oil fields. Sudan In The News gained exclusive access to secret documents circulated within the Sudanese Ministry of Energy and Mining – which fell under the portfolio of civilians before the coup. The documents revealed the full extent of the security crisis in Sudan’s oil fields. Despite Bloomberg reporting that Sudan produces 65,000 oil barrels per day (b/pd) as recently as 27 October 2021, the documents that Sudan In The News obtained reveal that Sudanese oil production is 39% less than reported. In fact, oil production actually fell by 32.6% - from 58,728 b/pd in February 2021 to 39,538 b/pd in March 2022. During that time period, there were at least 772 security incidents that sabotaged or disrupted oil production. Thus resulted in losses of at least 200,000 oil barrels, with at least $27 million accumulated in repair costs.

4. Why are these attacks happening?: The attacks, which continue to occur at the time of writing, are carried out by members of the communities where oil fields are located. The locals hold grievances about the lack of social responsibility projects from oil companies operating in their community. But why were the civilians in the oil sector unable to deliver these projects? According to a high-ranking whistle-blower in SudaPet, Sudan’s state-owned national oil company, the military component of the transitional government neglected to provide the security needed to deliver both the demanded social responsibility projects and achieve the civilian oil production targets.

5. The military’s role in enabling the attacks: The documents revealed how the civilians in the energy ministry called on the military-led Transitional Sovereign Council and Ministry of Defence to increase security and activate emergency laws in oil production areas.

6. Why would the military ignore the requests for security?: However, the whistle-blower alleges that the military deliberately refused to secure oil fields so that the fuel and economic crises would intensify, so as to give the military justification to eventually oust the civilian component of the transitional government. The military eventually staged its coup under the guise that that the civilians failed to solve the problems confronting Sudan’s impoverished masses, thus enabling them to frame the October 25, 2021, coup as a “correction of the democratic transition”.

7. What next?: Yet, even after the coup, the hidden war in the oil fields rages on. The attacks that the military allegedly turned a blind eye to are escalating beyond their control. According to the SudaPet whistle-blower, the coup regime is keen to suppress this information as it seeks to avoid the “embarrassment” of their inability to provide security and stability, as well as the freefalling production of one of Sudan’s most important natural resources amid fuel and economic crises which prove a leading factor in continued public anger against military rule.

8. Corruption: The coup regime’s silence on rapidly declining oil production reflects the wider lack of transparency in Sudan’s oil sector, with the whistle-blower revealing how it intersects with corruption in Sudan’s oil industry.

Part 2: Analysis and solutions

9. Analysis (Humanitarian): Fuel shortages in Sudan are feeding a worsening humanitarian crisis that has seen 40% of Sudan’s population project to face food insecurity. We spoke to staff at two humanitarian organisations in Sudan – the UN World Food Programme and the Norwegian Refugee Council – who explained how the fuel crisis is causing domino effects that trigger: unaffordable food and transport prices, impede the impoverished from earning a living, prevent personal expenditure on health and hinder attempts by humanitarian organisations to mitigate the crisis.

10. Analysis (Political): Kholood Khair, the founding director of Confluence Advisory think-tank, provided a political analysis on the fuel crisis, arguing that it exposes the coup regimes weaknesses, adds pressure on the generals and indicates that Sudan’s “growing instability does not create the right environment” for international investment.

11. Solutions: Proposed solutions for ending the security crisis in Sudan’s oil fields include satisfying the demands for infrastructure and employment from the marginalised groups attacking the oil fields. Alternatively, Khair calls for Sudan’s donor community to economically support a new transition and to re-route funding to pro-democracy forces so that it is not siphoned off by the coup regime.

1. Background

Since 2018, Sudan has faced an ongoing fuel crisis which has seen prices continue to soar. At the time of writing, petrol costs 522 Sudanese pounds (SDG) per litre ($0.92), with diesel costing 700 SDG ($0.92) (Radio Dabanga, 5 October). This reflects a slight fall from August 2022, when petrol and diesel were at SDG 760 and SDG 748 ($1.34) respectively.

With increased fuel prices resulting in higher transport costs, the fuel crisis sets off a domino effect that “paralyses the entire life of the citizen,” wrote Sudanese journalist Sabah Mohammed al-Hassan (Al-Jareeda, 10 August 2021). Transported goods like food are becoming increasingly unaffordable for much of Sudan’s impoverished population. Likewise, public transport is also too costly for the many who Sudanese who need it to travel to work and earn a living. Thus, the combination of these factors ensure that the fuel crisis worsens Sudan’s pre-existing cost-of-living and inflation crises.

Several factors offer insight as to why fuel is so expensive in Sudan relative to the average citizen’s disposable income. Firstly, the lifting of fuel subsidies as recommended by the International Monetary Fund in June 2021 almost doubled the prices of petrol and diesel overnight, leaving those in Sudan to contend with a stark increase from the previous prices of 150 and 125 SDG respectively (Sudan In The News Economy briefing, June 2021).

Secondly, we have to take a dive into the history of oil in Sudan in order to understand how the fuel crisis was looming. To do this, we must cite the recently published book Sudan’s Unfinished Democracy (Hurst Publishers, 2022).

1.1 A brief history of oil in Sudan

In the 70s, oil was discovered predominantly in South Sudan. However, oil wells were closed months before production due to attacks by the Sudan People’s Liberation Movement – a South Sudanese rebel group that was at war with the military regime in Khartoum. No major oil company could invest in Sudan’s oil potential given the ongoing civil war and later the State Sponsor of Terrorism designation. However, oil began flowing in 1999 after Chinese investment, which enabled then-president Omar al-Bashir to use oil revenues to expand the national budget tenfold in the coming five years (p.68). During Sudan’s oil boom, Sudan became an oil-rentier state (p.72), whereby oil revenues were converted into political capital that stifled opposition.

Large numbers began to share the material benefits of the oil boom, in the form of salaried employment, a boom in construction and trading consumer commodities. The regime’s business plan, or production function, was converting oil into political [quiet] (p.72)…oil had been the ideal [tap] for political funding: it was centralised and could be managed through a few large transactions, and it generated employment and other benefits that kept the [ruling National Congress Party] constituencies relatively content (p.81-82)
From Sudan’s Unfinished Democracy (Hurst Publishers, 2022)

However, the secession of South Sudan in 2011 made the oil-renter model unsustainable (p. 72-73). After al-Bashir’s regime illegally diverted South Sudan’s oil to Sudanese refineries for domestic use, South Sudan closed its entire oil production in January 2012 (p. 74). Production was restored in April 2013 at a fraction of previous levels (p. 76), meaning that Sudanese oil production barely covered domestic consumption, thereby putting an end to oil-based rentiership (p. 77). Amid fuel shortages, al-Bashir’s regime scaled-back fuel subsidies in austerity measures. According to activists, at least 200 were killed by the regime after taking to the street to denounce deteriorating economic conditions that saw food and petrol prices double overnight (BBC, 14 November 2013).

Nonetheless, De Waal noted that “one reason for the apparent complacency of the powerbrokers in Khartoum” over the fuel shortages was the discovery of gold, as the regime began to earn more from gold exports than oil in 2013 (p.78). Gold subsequently became the primary source of political funding. As Sudan went from being an oil exporter to an oil importer, the country’s economic stability and sufficiency worsened. Continued fuel shortages from 2013 onwards caused increased food prices and intensified economic hardships which paved the way for the December 2018 protests that eventually toppled al-Bashir’s regime (Chr. Michelsen Institute, January 2019). As a result, it became clear that mitigating the economic crisis triggered by South Sudan’s secession would lie in reversing the fuel crisis.

2. Civilian plans to increase oil production

Sudan went from exporting to importing oil after the secession of South Sudan, which triggered the fuel shortages that have caused Sudan’s rapidly deteriorating economic situation. Yet, a high-ranking official at Sudan National Petroleum Corporation (SudaPet), has declared that not only does Sudan have enough oil reserves to solve the fuel crisis - it also has the capacity to be an oil exporter once again. Due to the sensitivity of information this official has provided us with, they will remain anonymous throughout this report, and for the purposes of clarity will hereby be referred to as ‘the SudaPet Whistleblower’ (SW).

SW informed us that Sudan currently has enough oil reserves to dig out 455,000 b/pd, and that it only requires to produce 180,000 barrels b/pd to be self-sustainable. SW also noted that technology was available for this task, but that the civilian component of the pre-coup transitional government was unable to implement a long-term programme to gradually increase production due to “security and political challenges”.

Despite the most recently reported figures on Sudan’s oil production stating that Sudan produces 65,000 b/pd (Bloomberg, 27 October 2021), the documents Sudan In The News gained access to indicate that Sudan’s oil production is actually 39% less than reported. According to non-public documents from Sudan’s Ministry of Energy and Mining, Sudan produced 58,728 b/pd in February 2021, with the plan being to reach 74,091 b/pd by December 2021. Of course, the military coup of 25 October 2021 interrupted those plans. But, as we can see in the documents obtained by Sudan In The News, the civilian energy ministry was not able to achieve its targets to increase oil production. In fact, oil production fell from a average of 58,000 b/pd in February 2021 to 56,000 at the start of May 2021.

Sudanese Energy Ministry document (May 2021) outlining plans to reach 74,091 oil barrels per day by the end of 2021.

Sudanese Energy Ministry document (May 2021) showing that oil production was rapidly declining in early 2021

Furthermore, SW revealed to us that, as of March 2022, Sudan is only producing around 39,538 b/pd, thereby representing a 32.6% decline on the figures initially reported by Bloomberg.

Document provided by Sudanese oil industry insiders to show the decline of oil production following the coup.

So, why is this happening? What are the security and political challenges that are contributing to this drastic decline in Sudan’s oil production?

3. The hidden war in Sudan’s oil fields

SW exclusively revealed to Sudan In The News that there have been at least 772 attacks on oil fields during a period that began in January 2020 (shortly after the post-Bashir transitional to democracy began) until the military coup of October 2021. These attacks are mainly sabotage and disruption operations that include:

Cutting cables or destructing pipes that carry oil from wells (this disruption subsequently prevents the processing and transportation of oil from small stations for power distribution)
Blockages
Stealing of oil production equipment including vehicles.
Kidnapping or intimidation of oil field workers.

Sudanese Energy Ministry document (August 2021) sorting the attacks on oil production facilities (from Jan to Aug 2021) by type.

Sudanese Energy Ministry document (May 2021) showing the attacks on Heglig oilfield operatedb by 2BOPCO, which accumulated over 3.2 million US dollars in losses, with over 53,601 oil barrels lost.

To get precise numbers on the volume of sabotage operations on Sudan’s oil fields, non-public internal documents from the pre-coup civilian-held energy ministry indicated that, in 2020, there were at least 264 security incidents recorded on oil fields operated by companies that SudaPet sub-contracts to: 2B Opco and PetroEnergy losses. Then, in 2021, from January to the end of August, there were a further 440 recorded security incidents ranging from sabotage (293), thefts (67) and even kidnappings (3) and shootings (2). In addition, SW informs us that there have been 68 further incidents from September up until the military coup on October 25.

So, how does the security crisis on Sudanese oil fields drastically reduce oil production? According to SW, alongside internal documents circulated within the formerly civilian-held energy ministry, the disruptions caused by acts of sabotage, violence against workers, and equipment destruction result in: losses of thousands of barrels, high repair costs, and insurance pay-outs. These large losses significantly deplete from the sums that were allocated towards increasing production. By extension, potential investors in Sudan’s oil potential are deterred by a security crisis that risks huge losses, alongside high repair costs.

For reference, the energy ministry’s non-public internal document showed that three oil production companies operating in Sudan lost at least $10 million in 2020 alone. 2B OPCO, a Sudanese company, lost 47,000 barrels. In the first quarter of 2021 (January to March), the document revealed that two companies – 2B OPCO and PetroEnergy, predominantly owned by China’s National Petrol Corporation – needed to pay a combined $17.3 million in repair costs following security incidents. 2B OPCO and PetroEnergy also lost a combined 173,726 barrels, according to the documents. SW added that the total value of losses from January 2020 until the October 2021 coup was roughly 200 million dollars altogether.

Sudanese Energy Ministry document (May 2021) showing how much different oil companies lost due to the attacks

Sudanese Energy Ministry document (May 2021) showing how much PetroEnergt lost in 2020 and early 2021 due to the attacks: over 14 million US dollars and 120,665 barrels.

So, why are these attacks happening? And who is responsible for them? “One of the biggest obstacles [to advancing oil production] is the obstruction of work by the local population”,” according to a document from the energy ministry that recorded the attacks of August 2021.

4. Why are these attacks happening?

Sudan’s oil reserves are located in the marginalised peripheral regions and are spread out across the states of: West Kordofan, South Kordofan, East Darfur and the White Nile. Historically, power and wealth in Sudan has been concentrated in the predominantly Arab urban centre (Khartoum and, to a lesser extent, neighbouring states). By contrast, the rural peripheries which host many of non-Arab indigenous ethnic groups have, and remain economically neglected and politically excluded. As a result, SW attributes attacks on oil fields and the disruption of production to grievances held by locals about the lack of services and social responsibility projects from oil companies operating in their localities.

Sudanese Energy Ministry document (August 2021) identifying oil fields across Sudan.

An oil field where attacks are frequent is Balila in West Kordofan. The energy ministry’s document revealed that there were 2-3 daily attacks in Balila between January in March 2022. While these attacks often went unreported various local media outlets began to report on them in March. Indeed, an armed group called the West Kordofan Struggle Front (WKSF) has claimed responsibility for grenade attacks on Balila (al-Jareeda, 8 March 2022). Reporting that Balila has been “occupied” since 2019 as locals demand employment and services, Sudanese newspaper Al-Intibaha (8 March 2022) quoted statements from the WKSF Struggle Front which revealed grievances including:

The lack of jobs for locals, many of whom hold university degrees in oil, as they are given to professionals from other states.
Locals with degrees given “marginal” jobs such as cleaning, cooking, guards etc.
Oil exploration agreements which promised benefits for locals as reparations for the negative health impacts of oil exploration not being fulfilled, including: free medical treatment and payments for families living around the fields.

The WKSF demanded:

5% of the proceeds from production in their area to be allocated towards developing the local health and water sectors.
300 job opportunities and employment with operating companies.
The establishment of 80 shops in the locality.

These grievances were known and acknowledged by the civilian energy ministry, according to SW. So, what were they doing about them? Why were social responsibility projects not forthcoming from the oil companies?

SW attributes the absence of such social responsibility projects to the military component of the transitional government turning a blind eye to requests from civilians in the energy ministry to protect the oil fields amid a worsening security crisis. SW said the civilians needed security in order to implement the social responsibility projects that would help them to reach their oil production targets and subsequently start to resolve the fuel crisis.

Documents from the formerly civilian-held energy ministry raised difficulties in dealing with the entities that are sabotaging and disrupting oil production, highlighting the following as a challenge:

Sudanese Energy Ministry document (August 2021) analysis of security incidents with translation below.

The emergency of many youth entities with different names, all of which claim to adopt the demands of the region. This make it difficult to deal with one side. These entities carry the spirit of fanaticism and tribalism, even among clans within a single tribe. This makes narrow interests a primary goal without regard to the public interest.
(Sudanese Ministry of Energy and Mining document, 2021)

5. The military’s role in enabling the attacks

Energy ministry documents that compiled the attacks on the oil fields concluded with a list of recommendations aimed at Sudan’s powerful security sector. The recommendations from one document, translated below, indicate that civilians in the energy ministry asked the military component to secure the oil fields.

Sudanese Energy Ministry document (May 2021) calling for security. Translation below.

The security sector should:
1.     Strengthen their deployment in production areas, and along the production line, in co-operation with the Security Committee, and activate the supervisory role, imposing state domination, positively and timely intervene in the event that work is disrupted in the areas of production and hold whoever causes such disruption accountable before the law.
2.     We also recommend the establishment of attorney offices in production sites and convene trials immediately.
3.     Consider oil’s security and oil facilities as a matter of national security, and activate the application of law in order to impose the state’s will in production sites.
4.     Make patrols inside oil fields in order to watch faraway wells, and know those who are responsible of damage and theft.
(Sudanese Ministry of Energy and Mining document, 2021)

However, a later document, which was written and distributed at the end of August 2021 reveals stronger signs that the military component of the government was responsible for enabling the attacks. The highlighted passages of the document below indicate that civilian energy ministry representatives met with a security committee to secure a key oil production facility, but the committee said that the security situation is “out of [security committee’s] control and scope as it is the responsibility of the Federal Government (the Transitional Sovereignty Council)”.

The security committee then gave logistical hindrance preventing them from securing the oil fields in the face of near-daily attacks including:

Sudanese Energy Ministry document (August 2021) translated below.

·       Shortage of a guard force which led to some sites being vacated.
·       The deterioration of security management vehicles.
·       The weakness of electronic monitoring systems.
·       Weak and almost non-existent lighting in some places.
(Sudanese Ministry of Energy and Mining document, 2021)

The document also provides evidence of some of the policy solutions that the civilian-held ministry called for in order to help protect the oil fields, two which were highlighted below. Those two policies were highlighted because the military component of the government had the final say over whether or not they can be activated, let alone implemented.

Sudanese Energy Ministry document (August 2021) recommendations translated below)

· Considering the security of oil and oil installations as national security and activating the emergency law in the production areas, which requires the issuance of a decision from the Transitional Sovereignty Council and the Ministry of Defence.
· Increasing the forces and enacting laws that will resolve the intrusions and deter the intruders.
(Sudanese Ministry of Energy and Mining document, 2021)

6. Why would the military ignore the requests for security?

Nonetheless, SW alleges that the military deliberately ignored requests to send adequate cover, and allowed the sabotage and disruption of oil production to continue, in order to undermine the civilian component of the pre-coup transitional government.

SW said “the military wanted to fail the civilians”. Why? Because the consequences of the losses caused by the sabotage and disruption of oil production would worsen Sudan’s fuel and economic crisis, thereby giving the military a justification for staging the eventual coup of 25 October under the guise that the civilians component of the government neglected the masses. Nonetheless, to understand how the military neglected to secure the oil fields, we first need to understand how oil production facilities were secured before Sudan underwent a democratic transition.

SW explained that before the transitional period, oil fields were protected by the Sudan’s National Intelligence and Security Service (NISS), later rebranded as the General Intelligence Service (GIS) and stripped of its powers, personnel and assets by more powerful competing elements of Sudan’s ruling security apparatus – the Sudanese Armed Forces (SAF) and the Rapid Support Forces militia (RSF).

Back then, SW added, SudaPet would give oil production contracts, in opaque processes, to companies which NISS figures have significant control or influence over. NISS would then hastily implement a perfunctory sub-standard act of social responsibility – such as building a school or a water well – rather than devise and deliver a thoughtfully considered social responsibility programme designed to have a long-term impact on local communities that host oil fields. Instead, SW alleges, the NISS social responsibility budget was spent on paying off and co-opting influential figures in the local community, thereby fending off the violent consequences of the grievances that arise from prolonged communal neglect. Moreover, NISS secured oil fields to stave off attacks.

This all changed during the transitional period, after which the energy ministry came under the control of civilians as part of a power-sharing agreement with the military. SW told us that the civilians attempted to do away with the corrupt mechanisms, such as opaque contract tender procedures. There were also attempts to partner with the UN Development Programme to implement long-term social responsibility programmes to provide health, sanitation, educational and employment services to local communities, SW added. However, SW concedes, these plans were not able to come to fruition due to the escalating security crisis.

“For the corporate social responsibility (CSR) programmes to have an impact, they need time and resources. But the local demands increased because the projects were not delivered in time. The daily attacks made it harder to deliver these programmes,” SW said.

During the start of 2020, NISS was also being side-lined by the army and RSF, who dominated the military component of the transitional government. In fact, when disgruntled NISS officers attempted to stage a mutiny on January 14 (Energy Voice), they leveraged their dominant position in Sudan’s oil industry to close oil fields and disrupt production. The munity was squashed, with the army and the RSF re-establishing their positions as the dominant entities within Sudan’s militarised security apparatus.

So, with NISS out of the picture, why did the police or the army not secure the oil fields instead? SW said: “the police and the army did not want to secure the oil fields because the Islamists [who dominate the police and army] do not want to solve the economic crisis. They wanted the transitional government to fail and they wanted to blame the civilians for it so they can stage the coup”.

Indeed, as far back as 2020, civilian energy ministers warned that counter-revolutionary forces, in the form of the remnants of al-Bashir’s Islamist regime, targeted Sudanese oil production in order to weaken civilian prospects of facilitating economic recovery. Islamists were accused of both neglecting securing the oil fields and supporting the acts of sabotage. Hamid Suleiman, an ex-undersecretary at the energy ministry told Sudan Tribune (25 January 2020) that remnants of al-Bashir’s regime planned to “damage oil production areas by causing rifts between local tribes”.

In addition, Al-Rakoba’s report (2 May 2020) on acts of sabotage in al-Fula well in West Kordofan quoted a senior civilian ministerial source who alleged that “elements of the ousted regime are an authentic party in these systematic sabotage operations in the oil sector”, citing how the logistical process of disruptive sabotage operations are “difficult and expensive” as they require costly resources including a freight vehicle and several people.

Amid views that the military enabled the attacks on oil fields in order to weaken the civilian component of the transitional government, it is worth revisiting the strongly anti-civilian statements of Sudan’s military leaders in the weeks leading up to the military coup of 25 October 2021.

A month before the military coup, the leaders of Sudan’s ruling sovereign council – chairman Abdulfattah al-Burhan, who heads the SAF, and his deputy, the commander-in-chief of the RSF militia Himedti, both laid blame on civilian politicians for an allegedly foiled coup attempt by stating that civilians neglected public welfare and failed to address public concerns (Reuters, 22 September). Then, in his coup announcement, al-Burhan justified his so-called “correction of the course of the democratic transition” on the basis that removing civilians from power was a necessary measure for stability. “The participation of political forces in the transitional period is flawed and stirs up strife,” al-Burhan said (Multiple sources, 27 October)

Even after the coup removed civilians from government, the attacks on oil fields are still happening. The grievances of the communities situated in oil fields remain unaddressed by the coup regime. Consequently, oil production remains in freefall, and the fuel and economic crises in Sudan continue to intensify.

7. What next?

The Association of Oil Workers announced that over 70 oil wells were out of production due to sabotage since the beginning of 2022 (Radio Dabanga, 15 March), with a grenade attack reported as recently as April 7 (Radio Dabanga). Why is this still happening? SW claimed: “[the military] initially let [the attacks] happen by not securing the oil fields to weaken the civilians, and now the security situation is out of their control. They are hiding this from the public because it is humiliating for them. They do not want to show that they are weak and that they are unable to contain the security crisis in the oil fields”.

Indeed, despite images, videos, statements and news reports documenting the attack on Balila oil field, alongside its conformation by West Kordofan governor Khaled al-Jaily, and the local director of police, Major General Ihab Abdel Hamid denied that the field was attacked and that it was out of production or the control of security forces (Al-Intibaha, 8 March 2022). The coup regime’s silence on the hidden war in Sudan’s oil fields reflects the wider lack of transparency in Sudan’s oil sector, a reality which facilitates corruption and consequently prevents the achievement of any solution which benefits the public.

8. Corruption in the oil sector

SW broke down the opacity and corruption in Sudan’s oil sector in four ways:

·       “Firstly, the prices and total income of oil production, and where it goes, is totally hidden, even from employees [at state-owned SudaPet].
·       Secondly, subsidies that reduced domestic oil prices by 90% compared to international standards meant that other sectors misused Sudanese oil, and 15-20% of oil was smuggled outside of Sudan and sold for higher profits
·       Thirdly, domestic companies that win contracts are led by incompetent staff who are in their positions due to their connections. The civilian energy ministry was working to prevent this, but the coup ended this progress.
·       Fourthly, in opaque tender and contract procedures that are not disclosed companies connected to the security apparatus take high returns and money is not redistributed to the economy.” - SW (2022)

Thus, the corruption in the oil sector, alongside the freefalling production caused by the coup regime’s inability to address the grievances of communities where oil fields are located, remains the main contribution to Sudan’s worsening fuel and economic crisis. This culminates in further negative implications for humanitarian operations in Sudan, which will be summarised in the analysis section of the investigation.

Part 2: The analysis and solutions

Having established the political reasons behind the worsening of Sudan’s fuel crisis in Part 1, the second part of Sudan In The News exclusive investigation includes analysis on the humanitarian and political impacts of the fuel crisis, as well as proposed policy solutions directed towards Sudanese and international policymakers.

9. Analysis: Humanitarian

With the fuel shortages in Sudan feeding a deteriorating humanitarian crisis that has seen 40% of Sudan’s population projected to face food insecurity, we spoke to staff at two humanitarian organisations in Sudan – the UN World Food Programme (WFP) and the Norwegian Refugee Council (NRC) - who explained how the fuel crisis both worsens the humanitarian crisis, alongside hinders attempts by humanitarian organisations to alleviate it.

9.1 Increased food prices

The WFP’s Comprehensive Food Security and Vulnerability Assessment for Sudan showed that 1/3 Sudanese – over 15 million across Sudan – are facing food insecurity in 2022, which was projected to rise to 18 million (40% of the population) by the end of September 2022. According to Leni Kinzli, the Communications Team Leader at WFP Sudan, the main drivers of food insecurity in Sudan include: climate shocks, conflict and displacement, the economic and political crisis, poor harvests and soaring food and fuel prices.

“The fuel crisis is feeding the food crisis,” said Mathilde Vu of the Norwegian Refugee Council in comments to Sudan In The News. “The rise in fuel prices has led to a more than 25 percent increase in Khartoum transportation tariffs and is expected to lead to a steep increase in the price of food and non-food items” Vu added. Attributing the fuel crisis to higher prices in the markets and even less affordable food, Vu explained how agriculture is “going to be extremely costly” where diesel is necessary for harvesting, with the “decrease in crops leading to rising prices for basic commodities”. Indeed, Kinzli told Sudan In The News that “since the same time last year, the price of food in Sudan has gone up by around 140%,” with higher fuel prices meaning that the costs of transporting and importing food will continue to rise. To further compound matters amid increased food prices, the fuel crisis also poses obstacles to attempts by ordinary Sudanese to earn a living.

9.2 Obstacles to earning a living

Vu emphasised the impact of the fuel crisis on the refugees and IDPs that NRC support, who live in remote areas but rely on public transport to reach the closest job markets. “With the [fuel] price increase, many can hardly afford the cost of transportation, and told us they were not able work every day” Vu said. “As public transport (buses) is the affordable choice for most people in a country with an economic crisis, the fuel crisis leads to a decrease of transportation options as drivers have no choice but to raise their prices to meet the fuel price increases,” Vu added. “All of this contributes to lack of access to jobs. Especially for refugees and IDPs mostly residing in the outskirts of Sudanese cities,” Vu stressed, meaning that the job market – which is concentrated at the centre of cities like Khartoum – “can be too far”.

9.3 Paralysing the life of the citizen

Comments to Sudan In The News from Vu and Kinzli lend further credence to the view expressed by Sudanese journalist Sabah Mohamed al-Hassan that the fuel crisis sets off a domino effect that “paralyses the entire life of the citizen” (Al-Jareeda, 10 August 2021). Vu told us that the |consequences [of the fuel crisis] are severe and impact all aspect of life: it’s difficult for [people] to feed their family, send their children to school and afford healthcare”. Similarly, Kinzli explained how increased food prices caused by the fuel crisis force Sudanese people to “borrow from their futures”.

In fact, some 95% of Sudanese spend over 65% of their total expenditures on food alone. As prices continue to increase, which we anticipate they will, it will become harder for people to afford a basic meal and more people will become food insecure. With people spending even more of their total expenditures on food, there will be less left over for other basics like health or education. Essentially, people are ‘borrowing’ from their future, to afford survival at the current moment. People cannot invest in building their future when all theirearnings are going towards putting food on the table.
Leni Kinzli, WFP Sudan

The damaging impacts of the fuel crisis are further reinforced by hindering attempts to alleviate the food crisis it has caused. The WFP’s Kinzli said: “the cost of delivering assistance and transporting food to remote locations across Sudan can be expected to go up as global fuel prices are increasing. Essentially, providing aid will become more expensive and cost organizations like WFP more, yet additional funding is not coming in.”

10. Analysis: Political consequences

Kholood Khair, the founding director of Confluence Advisory think, provided Sudan In The News with an analysis of the political impacts of the fuel crisis. Khair suggested that the crisis exposes the coup regime’s weaknesses and will add pressure on them

10.1 Fuel crisis likely to add pressure to the generals

Providing Sudan In The News with an analysis of the political impact of the fuel crisis, Kholood Khair, the founding director of Confluence Advisory think-tank, said the fuel crisis will “add more pressure” on Sudan’s coup regime, noting that the “fuel pinch will be felt by all and the exacerbated cost-of-living crisis is likely to bring greater number of people on to the street”. Drawing comparison to the uprising that toppled ex-president Omar al-Bashir’s regime, Khair said: “what we saw with Bashir’s downfall is that food and fuel prices became, in a way, great social equalisers. At a certain point even wealthier Sudanese could not afford to buy bread, fuel and other commodities at high prices”. Khair also highlighted two further ramifications for the coup regime stemming from the fuel shortages:

10.2 Investment climate

With the October 2021 coup leading to the suspension of at least $700 million in aid, the cash-strapped coup regime requires international investment to compensate for its losses. However, Khair notes that the “growing instability in the country does not create the right environment for investment”. Indeed, as the documents from the civilian-held energy ministry revealed, civil servants cited the repeated attacks on oil facilities as a deterrent to potential investors. Nonetheless, Khair also highlights reputational deterrents to international investment in the coup regime, arguing that “any deal struck by international actors, or companies with the current regime, will result in serious future damage between these countries and companies and the people of Sudan”.

10.3 Coup regime weaknesses exposed

The fuel crisis also exposes the weaknesses of the coup regime. “Fuel crises in Sudan have always been a sure sign that the government of the day is failing to avail key commodities and balance its books,” Khair explained.

The coup regime is weak, it is made of a constellation of security and Islamists actors who have different and often competing, medium-to-long term objectives. It therefore uses violence to suppress dissent while it is unable to provide services and basic duties of the state, such as physical security and food security. In addition, it is clear that the regime does not have any long-term plan, except to guarantee its own survival. As such, it cannot remain in power or intact for very long and fissures have already started to show, particularly, and lamentably, across racialised lines. That said, though the regime is weak, continued lifelines thrown to the regime, intentionally or inadvertently, by the international community, allow it to buy time in order to consolidate the coup and bring about an Islamo-military restoration.
Kholood Khair, Confluence Advisory

11. Solutions

Harnessing the potential of Sudan’s oil reserves by increasing production can set the path to solving the economic crisis and improving living standards if profits are equitably redistributed to the population as opposed to corruptly misused. However, the sabotage and disruption to production caused by recurring security incidents are an obstacle to increased oil production. Oil companies are forced to spend exorbitant amounts on repairs, which take away from both production costs and the social responsibility budgets that can alleviate the local grievances which trigger the attacks. So, what is the solution to this crisis?

11.1 Consider local grievances

In comments to al-Sayha (2 March 2022), economic researcher Dr. Haitham Mohammed Fathi called for the government to consider the grievances of locals near the oil fields by satisfying their demands for infrastructure and employment, thereby making them “protectors of these projects”.

However, the aforementioned corruption in Sudan’s oil sector identified by SW vastly reduce the chances of Sudan’s oil resources being employed for the public good. Moreover, as argued by former oil minister Ishaq Bashir Jama’, in Sayha (2 March 2022), the coup regime is unable to focus on directing security resources towards Sudan’s oil fields as it remains preoccupied by continuing nationwide pro-democracy protests.

With coup regime attempting to cling onto power by any means in the face of widespread public opposition, Kholood Khair suggests that it “cannot remain in power much longer,” before suggesting ways that a new transition can be supported.

11.2 Economically support new transition

Khair calls for the Sudanese donor community to economically support a new transition so that the transitional government can show value to Sudanese citizens. Nonetheless, Khair notes that while a credible handover means that the generals will need assurance, it must also be acceptable to pro-democracy forces and marytrs families.

11.3 Re-route funding to pro-democracy forces.

In addition, Khair calls on international donors to re-route their Sudan funding into a trust fund to be operationalised in a future transition. If possible, Khair adds, funding should focus on providing political support to pro-democracy forces, rather than concentrating on financial support as the main form of aid.

Khair explained that this move would be necessary as the coup regime is willing to bank on internal pressures within Sudan’s donor community to provide aid and spend funding assigned to Sudan’s transition amid Sudan’s worsening state of state of affairs.

Khair added that the coup regime is prepared to conduct Bashir-era practices of waiting the international community out in order to force their hand and siphon off funds through technical agreements, agreements on lending or sharing assets and resources, or restricting access to greater funds from aid supplies. Thus, Khair warns that “donors need to hold firm and not play into the regime’s hands”.