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Oil majors Royal Dutch Shell and Total have slashed Syrian oil production as international sanctions make exports impossible, industry sources told Reuters. The development is a further sign that sanctions begin to bite the regime of President Bashar al-Assad at a time when the international community is considering widening the sanctions against Iran, a much bigger oil producer. Syrian oil represents less than 1 percent of daily global production but accounts for a vital portion of Syrian government earnings, which Western powers say could be used by Assad for a bloody military crackdown on the opposition.
U.S. and EU sanctions aimed at crude oil exports have warded off normal buyers of Syrian crude, which mainly flowed to Europe, causing storage tanks to brim and forcing cuts.
"The ministry has instructed all of the joint ventures to cut production significantly," said an oil industry source with knowledge of the Syrian oil sector.
A second oil industry source confirmed that this was affecting production at Shell's joint venture and a third source said it had impacted Total's investments.
Both firms declined to give an official comment.
This is the first indication that sanctions-related output cuts are widespread after British company Gulfsands Petroleum Plc said the oil ministry had asked it to cut output.
Syria produced around 350,000 barrels per day (bpd) before the unrest of which about a third was exported, with most flows going to Europe.
In a further sign that foreign interests could be jeopardized, the EU is mulling tougher sanctions on Syria which would make it illegal for international firms to maintain oil and gas investments there. Canada's Suncor Energy, Britain's Petrofac, India's Oil and Natural Gas Corp and the China National Petroleum Corporation (CNPC) are also operating in Syria's energy sector.
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