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South Sudan's oil revenues decline after the disruption of an export pipeline

March 31, 2024

South Sudan's revenues declined as a result of the disruption of a pipeline crucial to the country's ability to export crude oil to foreign markets. In light of this, the Minister of Finance of South Sudan, Awu Daniel Chuang, stated the cessation of oil flows coming from several basic fields in South Sudan, which passes through the pipeline. The broken pipeline is located on the country's northern border towards war-torn Sudan.

Due to the crisis in South Sudan, the situation has worsened, as South Sudan’s revenues depend by 90% or more on oil, and it no longer flows from some fields that are very important for South Sudan. The Minister of Finance visited abroad to request financial aid, but did not mention the country he visited. Work has already begun with the Central Bank of Sudan to pay at least one month’s wages.

South Sudan's ability to sell its oil has been put under pressure by the growing security unrest in the Red Sea, but the damaged pipeline was noticed after damage was discovered during February when the flow of crude oil was disrupted and exports were halted.

The head of the Sud Institute, Jok Madurai, which is a research center and is based in Juba, announced that the fragile state is completely unable to pay the wages of most of its government employees, and many of them have not received their wages for six months. As for the return of revenues, this has not increased the possibility of South Sudan’s military intervention. In the civil war currently taking place in Sudan, it even threatens to destabilize the regime of President Salva Kiir, as he failed to pay the wages of the soldiers. This was stated by Andrew Smith, chief African affairs analyst at Verisk Maplecroft.