Khartoum – Sudanese Minister of Energy and Oil, Moatasem Ibrahim, said that opening the Strait of Hormuz removes one of the most important external factors causing the rise and fluctuation of fuel prices, and gives the import of petroleum derivatives greater stability in the supply routes east and west, amid a fuel crisis witnessed by Khartoum and a number of Sudanese states.
Ibrahim expected, in a special statement to Al Jazeera Net, that opening the strait would lead to positive effects within the country, saying that the step would have repercussions on prices, and would contribute to stabilizing the exchange rate of the Sudanese pound and improving the cash reserves necessary for import and distribution operations.
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He explained that fuel prices in Sudan depend on the international price and the local exchange rate, but opening the Strait of Hormuz means better flow of fuel into the country, he said.
Standard Brent crude rose by 0.23% to record $79.14 per barrel at the time of writing these lines, while American crude rose by 0.11% to record $76.13 per barrel, keeping the two crude oils below the level of $80, a decline from levels before the announcement of the US-Iran agreement.
Economic analysts believe that the closure of the Strait of Hormuz had indirect effects on the import and distribution of fuel in Sudan, despite the reserves established by the government to ensure the continuity of oil supplies, due to the high cost of shipping and insurance and the disruption of global supply routes.
Double pressure
The Minister of Energy’s statement comes as Khartoum and a number of states are witnessing a shortage of petroleum derivatives and an unprecedented rise in their prices, amid a continuing decline in the value of the Sudanese pound, which makes any increase in global prices or the cost of maritime transport quickly move to the local market.
Last March, the Sudanese Ministry of Energy and Oil announced, through the official spokesman’s platform, arrangements to import fuel in cooperation with private sector companies, and said that 30 companies had completed the organization and solidarity procedures in 5 groups, with public sector companies continuing to cover any potential gaps in supplies.
The Ministry confirmed at the time that the measures came in light of developments and changes in global energy markets, which necessitate taking measures to secure fuel supplies during the coming period.
This June, the Ministry of Energy announced a new package of controls to regulate the import and distribution of petroleum derivatives, which included issuing international bids for import, in a move that it said aimed to enhance transparency and ensure the flow of fuel supplies through qualified companies in the public and private sectors.
The importance of Hormuz
The US Energy Information Administration describes the Strait of Hormuz as one of the world’s most important oil bottlenecks, given the volume of crude, oil products, and liquefied natural gas that passes through it daily.
According to the US Energy Information Administration, the average oil flows through the Strait reached about 20 million barrels per day in 2024, equivalent to about 20% of the world’s consumption of oil and petroleum products, and flows through it constituted more than a quarter of the global seaborne oil trade in 2024.
The administration adds that about a fifth of global liquefied natural gas trade will pass through the Strait of Hormuz in 2024, most of it from Qatar, and that closing any major shipping lane, even temporarily, could lead to significant delays in supplies and higher shipping costs, thus increasing global energy prices.
The Energy Information Administration says that the alternatives available for transporting oil outside the strait are limited, despite the presence of pipelines in Saudi Arabia and the UAE that can partially bypass Hormuz, which explains the markets’ sensitivity to any security tension in the region.
Internal crisis
It is noteworthy that the shock of the closure of the Strait of Hormuz has increased the crisis in the Sudanese energy sector since the outbreak of war in April 2023 between the Sudanese army and the Rapid Support Forces, as oil and electrical facilities were damaged, and the country’s ability to refining, transport, and distribute declined, which increased reliance on the direct import of oil derivatives.
A World Bank report on electricity and oil in Sudan said that vital facilities in the Khartoum refinery, including the main crude tank and control center, were exposed to the fire, which forced the refinery to stop and caused disruptions to the supply of oil products in Khartoum, the northern states, the Nile River, and the Red Sea.
