CAIRO: The ongoing fighting in the oil fields of the Sudan, between the Sudan's army (SAF) and South Sudan's military arm, the Sudan People's Liberation Army (SPLA), has engendered further economic woes for an already struggling Khartoum. A source in Khartoum has told Bikyamasr.com that there are long lines at gas stations, and too, that their currency, the Sudanese pound, has significantly dropped in value. One US dollar now buys more than 6 Sudanese pounds, which is over double the official rate of 3 pounds. On hearing the news that the oil-producing Heglig had been taken by South Sudan's army many people in Khartoum rushed to buy dollars, fearing that the loss of a significant portion of Sudan's oil revenue would severely damage the economy. This, according to reports in the Sudan Tribune. Heglig is extremely important to Khartoum because it represents roughly half of the Sudan's 115,000 barrel per day (bpd) oil output and the fighting has stopped production there. With South Sudan's secession last year the Sudan lost 75 percent of the country's oil production. Khartoum was hoping that transit fees on South Sudan's estimated 350,000 bpd output would help ease the loss. In an attempt to recoup the financial losses, Khartoum imposed a heavy tax on South Sudan's oil traveling through its pipeline to Port Sudan on the Red Sea. Those transit fees account for 36 percent of the Sudan's budget. There are no other options for moving the oil, and when the land-locked South Sudan suspected Khartoum was siphoning the oil and asking for too much money, they responded but stopping oil extraction altogether. 98 percent of South Sudan's revenue is from oil; they are also considered one of the most under-developed regions in the world due to half a century of warfare with Khartoum. Khartoum's need for dollars has made it difficult for Sudanese businesses to obtain the hard currency they need to import goods, forcing many to use black market traders. There has been a crack-down on the money changers lurking in Souq al-Arabi, the central market in Khartoum If the government has to import more fuel due to the stoppage in oil production, the currency situation will worsen. The Heglig oil fields, are allocated to the Sudan, and South Sudan shocked the region when they moved last week to take possession of them. The United Nations and the African Union demanded a withdrawal, however, South Sudan has asked for an international peace-keeping force to take its place, which is not going over well. South Sudan maintains the region has been used for launching attacks into their sovereign territory. Al-Sawarmi Khalid, spokesman for the Sudanese Armed Forces (SAF), said, “We have not carried out attacks into South Sudan.” SPLA spokesperson Philip Aguer insisted Heglig is part of South Sudan. The battle continues to rage, with the SAF bombing installations and bridges – 5 civilians are said to have died. MiG fighters and Antonov aircraft are seen in the sky, which belong to the SAF. The SPLA does not have an air force, however, the SPLA is winning the battle for now, and by brute force and determination. For South Sudan, this is a fight to the death.
