Watad: The oil company that came from nowhere and became a key player in Syria

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Syrian people burn picture of Iranian President Hassan Rouhani, Russia and Syria flag during a protest against Russia in Istanbul, Turkey, 14 May 2019. According to reports Syrian army set up air strikes on the Idlib region of Syria with support of Russian and Iran on 12 May. [EPA-EFE/ERDEM SAHIN]

Life in rebel-held northwest Syria has, without a doubt,  been made easier by Watad Petroleum’s presence. But with no information available publicly about who owns or runs it, there is a persistent suspicion about it, writes Haid Haid.

Haid Haid is a research fellow at the International Center for the Study of Radicalisation at King’s College London. He is also a consulting research fellow of Chatham House’s Middle East and North Africa program. He contributed this op-ed for the Syndication Bureau, an opinion and analysis article syndication service that focuses exclusively on the Middle East.

Fuel and cooking gas are in very short supply in the parts of Syria controlled by the Assad regime. Yet in Idlib, the last rebel-held pocket of the country and currently the target of an intense military offensive, these and other essentials are not only available, but affordable.

This is thanks to a company named Watad Petroleum. But who or what is Watad? If suspicions are true, Watad – about which little is known – represents yet another way in which Hayat Tahrir Al-Sham, an organisation labelled a terrorist group by much of the world, is strengthening its grip on Idlib.

Life in this province of northwest Syria has, without a doubt,  been made easier by Watad’s presence. But with no information available publicly about who owns or runs it, there is a persistent suspicion about it.

The first that anyone had heard of Watad was in January last year, when it was granted a monopoly over the fuel market in greater Idlib, with exclusive rights to import oil and gas from Turkey and to regulate their sale, price and distribution.

Ostensibly, the deal, which also eliminated any domestic competition, was struck with Idlib’s Salvation Government, but in reality, it was with HTS, the de facto power in that area.

Before then, people in Idlib were reliant on motor fuel and gas transported from regime-controlled areas and on crude oil brought in from northeastern Syria, which is now controlled by the Kurdish-led Syrian Democratic Forces.

But economic sanctions and the Turkish-led offensive to capture the predominantly Kurdish region of Afrin led to those supply lines being severed. Enter Watad Petroleum.

Some reports say the company was founded in Idlib in 2017, while others maintain it was established in early 2018 by a group of Syrian businessmen living in Turkey. What is certain is that the mysterious Watad Petroleum has become a key player in greater Idlib.

After the Afrin offensive, according to multiple sources, Turkish suppliers began importing fuel, mainly from Ukraine, via an unidentified company and transporting it into Syria via the Bab Al Hawa border crossing, which HTS controls. Once in Syria, the fuel becomes the responsibility of Watad.

Under the terms of the January 2018 agreement, Watad regulates every aspect of the domestic fuel and gas market, from oil refining to setting prices, which are updated and published daily.

Watad has also taken over the processing of most of the crude oil produced in northeast Syria, having elbowed aside the unregulated makeshift local refineries, whose record on safety and environmental health was dubious, to say the least. The result is guaranteed availability of essential commodities in Idlib and at affordable prices.

Clearly, this has been of great benefit to the community. But when a new company rises so rapidly to gain sole control over such an essential – not to mention highly profitable – market, questions are bound to be asked.

Although often described as a privately-owned oil supplier, in the absence of more detailed information, the common assumption is that Watad is partly owned by or directly affiliated with HTS.

Those who subscribe to this belief point to Watad’s close cooperation with the Salvation Government, which is itself closely connected to the HTS. Watad relies on Salvation Government forces to ensure the smooth running of its operations.

While this could explain why HTS is willing to use its authority and resources to help Watad, it is, nevertheless, not conclusive evidence. The possibility remains that the two have merely come up with an arrangement that benefits each of them financially, but does not involve direct affiliation.

After all, political and ideological differences have never prevented Syrian businessmen from brokering deals with all parties throughout the conflict in their country. And if Watad indeed is tied to HTS, why would Turkey agree to Watad holding the monopoly over fuel imported through its territory?

To answer those questions, we need disclosure, clarity and transparency. We need to know who owns Watad, what deals the company has made and with whom. As long as the political and military dynamics remain unchanged in greater Idlib, Watad’s dominance in the fuel market is likely to remain unchallenged.

Having readily available, affordable fuel may be helpful to those living there but the flip side is that if HTS is indeed substantially involved in Watad, then this is more evidence of the group’s influence and grip over the area, which could mean that ultimately, the people of Idlib may end up paying a far higher price than they think.

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