In Search of Leverage for Syria

By David Schenker & Andrew Tabler

During his May 19 speech on the Middle East, President Obama defined America's policy objective in Syria by asking President Bashar al-Asad to either lead a political transition or "get out of the way." Asad shows no interest thus far in the former -- the death toll has reached 1,600, and atrocities and large-scale protests persist. To force Asad to step down or cause his regime to fragment, the United States should seek with its allies to increase the economic pressure and international isolation faced by the regime and to support domestic challenges to it. To achieve these effects, Washington has a number of unilateral and multilateral levers available, whether economic or diplomatic.

U.S. and International Diplomatic Levers

To affect the calculus of Asad and his supporters, the United States must increase the regime's economic and diplomatic isolation, and lend international weight to the domestic challenge to the regime. The ongoing demonstrations and burgeoning international consensus give Washington a broad range of options to do so.

Economic Pressure

* Target Syrian energy: Syrian oil production has been in steady decline since the mid-1990s and is now around 390,000 barrels per day. Of that, Syria exports around 148,000 bpd, with revenues accruing directly to the state. According to the IMF, oil sales account for about a third of state revenue, with the remainder increasingly made up through corporate and public sector employee taxes. As the protests decrease tax receipts, Damascus is likely to become increasingly reliant on oil revenue, forcing the regime to tap reserves and/or resort to deficit spending. This in turn would constrain the regime's ability to maintain market subsidies (e.g., for diesel fuel) and payoffs to patronage networks.

Accordingly, the Obama administration should prod the chief buyers of Syrian oil -- Germany, Italy, France, and Holland -- to stop purchasing the regime's heavy crude. It should also pressure multinational energy companies operating in Syria -- Royal Dutch Shell, Total, Croatia's INA Nafta, India's Oil and Natural Gas Corporation (ONGC), Canada's Tanganyika, SUNCOR, and Petro-Canada, and China's National Petroleum Corporation (CNPC) and Sinochem -- to exit the country. In addition, it should ask Britain to halt the operations of Gulfsands Petroleum, the one-time Houston-based company specializing in extracting heavy oil from depleted fields. The firm relocated to Britain in 2008 to avoid U.S. sanctions on Rami Makhlouf, Asad's cousin and the regime's primary businessman.

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* Target businesses associated with the regime: Elite defections could play a key role in pressuring the regime to either cut a deal with the country's Sunni majority or leave power. To date, the most effective U.S. sanction levied against Syria has been the Makhlouf designation. Along those lines, Washington should impose costs on other Syrian businesspeople who continue to back the regime.

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David Schenker is the Aufzien fellow and director of the Program on Arab Politics at The Washington Institute. Andrew Tabler is the Institute's Next Generation fellow.

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