SYRIA - Local Consumption.

Despite the shift to natural gas since the 1980s, Syria's oil consumption has risen to 275,000 b/d and may exceed 300,000 b/d in 2008 in view of an increase in smuggling. Syria's total energy consumption in 2008 is expected to average about 480,000 b/d of oil equivalent - with hydro-power accounting for less than 8% because of a fall in water levels at the Euphrates River.

The government on Nov. 1, 2007, raised gasoline prices 20%, to 36 Syrian pounds (74 US cents) a litre. This is still way below to world prices. The previous gasoline price rise was in January 2006, when it was raised 25% to 30 Syrian pounds (60 cents)/litre; at the time, Damascus said the measure was to counter smuggling to neighbouring countries where fuel prices were more than double.

The official daily Syria Times on Aug. 26, 2007, said the price of gasoil/diesel was to rise from seven Syrian pounds (about 14 US cents) per litre to 12 pounds ($0.24). It said the price of one household gas cylinder would go up to 250 pounds ($5) from 145 pounds ($2.9). It quoted PM Muhammad Naji al-'Utari as saying that, in order to alleviate the consequences of the price rises, Damascus was to increase government subsidies to low-income families.

'Utari said: "A family's average annual consumption of diesel is 800 to 1,000 litres and one household gas cylinder a month. Every family will receive 12,000 pounds ($240) a year and some 1,500 centres have been set up throughout the country for citizens' services, where they will receive two coupons of 6,000 pounds ($120) each". He said the heating allowance which government employees received would remain as it was when the new decision was put into effect.

Such measures were perceived to set right "deformations" and to "stop the bleeding" of the economy. Taking Lebanon as an example, 'Utari said this country used to import 750m litres/year of diesel from Syria, but in 2006-07 Lebanon imported only 250m litres and the rest was smuggled from the border. He said: "This means that we have offered about $300 million subsidies for diesel to our brothers in Lebanon. What about other neighbouring countries!" In addition, the influx of 1.5m Iraqi refugees equals the burden of 300,000 Syrian families who consume some $1 bn in diesel, electricity and LPG year. All these, 'Utari said, had put big financial burdens on the state treasury, adding that other measures, including readjusting power and water tariffs, tackling unemployment and carrying out projects of renewable energies, would also be taken in the future.

Much of the local demand for refined oil products is met by the refineries at Homs and Banias which have a combined capacity of 240,000 b/d. Syria imports more than 2.2m t/y of gasoil/diesel and gasoline, compared to 550,000 tons of gasoil/diesel in 1997. Imports are expected to exceed 3m t/y by 2010/11.

The Syrian Company for the Storage and Distribution of Petroleum Products (Mahruqat), fully-owned by the state, is in charge of oil marketing. The Syrian Company for Oil Transport (SCOT), another state concern, operates the country's pipeline network. SCOT carries crude oils from the fields in the north-east to the refineries and the Tartous and Banias oil terminals, and fuels from the refineries to consumption centres.