US government brokers a deal that would see Syria’s oil finance a terror group.
A secretive agreement has been struck between a US oil company, Delta Crescent Energy, and the so-called Syrian Democratic Forces (SDF) in North Eastern Syria in order to develop and export the region's oil.
Months after US president Donald Trump contradicted officials by suggesting that US forces were there “only for the oil” and vowing that it would “secure the oil”, the controversial deal lays bare the American strategy in the region.
The pact has been approved directly by the US government.
America backs the SDF militia in Syria which is dominated by the PYD/YPG. The YPG is the Syrian offshoot of the PKK, a group recognised by Turkey, as well as the US and the EU, as a terrorist organisation.
Who is Delta Crescent Energy?
The little known company at the heart of this agreement is led by former US government officials and includes James Reese, an ex officer in the Army’s elite Delta Force; former US ambassador to Denmark James Cainand and John P. Dorrier Jr., a former executive at GulfSands Petroleum, a UK based company that had previously worked in northeastern Syria.
Reese, one of the partners of Delta Crescent Energy, has been a strong advocate of US military presence in Syria. In 2018, he declared on Fox News "We own the whole eastern part of Syria...That's ours. We can't give that up."
This deal also exposes how, under the Trump administration, the US has blurred the lines between private and public sectors, raising questions about ethics and business dealings.
The former political insiders now leading Delta Crescent Energy were helped in sealing the deal by the US State Department, which, in turn, helped to broker it.
During a committee hearing in Washington, Republican Senator Lindsey Graham asked Secretary of State Mike Pompeo whether the Trump administration was in favour of the deal or not.
"We are," Pompeo responded during the hearing. "The deal took a little longer ... than we had hoped, and now we’re in implementation."
Pompeo’s comments suggest that the government has been fully aware, and further to that, encouraged the deal for more than a year.
Where will the oil go?
The oil agreement has been condemned by the Assad regime which does not recognise the American occupation of northeastern Syria, nor the legitimacy of its local proxies, the SDF.
Syria’s foreign ministry called the deal illegal and that it was aimed at “stealing” Syria’s crude oil.
The statement went on to add that the Damascus government “condemns in the strongest terms the agreement signed between al-Qasd militia (SDF) and an American oil company to steal Syria’s oil under the sponsorship and support of the American administration”, it went on to conclude that “This agreement is null and void and has no legal basis.”
The Trump administration is unlikely to approve oil sales to the Damascus regime.
Equally, Turkey has condemned the deal that has been struck by the US based oil company.
"We deeply regret the US support to this step, disregarding international law, violating territorial integrity, unity and sovereignty of Syria, as well as being considered within the scope of financing terrorism," Turkey's Foreign Ministry said on Monday in a statement.
"This act, which cannot be justified by any legitimate motive, is utterly unacceptable," the ministry added.
Turkey therefore is an unlikely buyer of Syrian crude oil, especially if it directly supports an organisation designated as a terrorist one.
The most likely outlet for the oil in northeastern Syria, is likely to be through Northern Iraq, in particular the Kurdish Regional Government. Since 2014, a murky yet highly lucrative trade has developed providing a crucial lifeline for the isolated SDF militia.
US meeting with PKK leadership?
The current oil deal comes amid a backdrop of meetings between a US delegation and the PKK leadership in the Qandil mountains of Northern Iraq, one the strongholds of the terror group.
According to reports, the delegation asked the PKK leadership to step back from northeastern Syria, as well as its financing and support of the SDF, and in return the US will take over as the main sponsor of the militia.
America is already known to enjoy close ties with the SDF leader, Mazloum Kobani, who is also a member of the PKK.
Kobani, whose real name is Ferhat Abdi Sahin, is one of Turkey’s most wanted terrorists.
The US support for the YPG in Syria has become one of the stumbling blocks in bilateral ties between the two NATO allies.
The Turkish military has launched three incursions into Syria to fight Daesh and the PKK/YPG.