Contracts in Syria’s oil sector have come under renewed scrutiny after social media posts and news reports alleged corruption and embezzlement amounting to roughly $110 million. The controversy centered on the Syrian Petroleum Company (SPC), its CEO Youssef Kablawi, and speculation over whether he might be dismissed or referred for investigation.

Official information, however, presents a more complex picture than the narratives circulating online. The Syrian Petroleum Company stated that the $110 million figure does not represent verified embezzled funds. Meanwhile, the Central Authority for Inspection and Control (CAIC) clarified that the sum corresponds to a precautionary asset freeze of approximately $104 million imposed on several contracting firms, with investigations still underway.

How the Figure Emerged

The debate began with reports of financial irregularities in multiple oil‑sector contracts. Within days, public discussion had escalated into headlines alleging the “embezzlement of $110 million.”

On September 26, the Syrian Petroleum Company issued a statement rejecting claims that funds had been stolen or lost from its accounts. It explained that the figure circulating online does not reflect the value of the audited contracts. Instead, it represents a preliminary estimate of potential damages in files still under review, with no final findings confirming actual losses or assigning legal responsibility.

The distinction between “estimated damage” and “proven embezzlement” is central to the case. Investigations have not yet produced public conclusions.

On September 29, Amer Al‑Ali, head of the Central Authority for Inspection and Control, offered further clarification in remarks to state news agency SANA. He confirmed that the ongoing audit covers several oil‑sector contracts and focuses on performance issues following contract execution. He noted that the authority had already been reviewing these files before they became the subject of media attention.

Al‑Ali stressed that the widely circulated $104 million figure does not represent stolen funds. It is a precautionary lien placed on the assets of specific contracting companies under investigation. Such freezes are protective measures intended to safeguard public money until investigations conclude, not final rulings establishing embezzlement.

He also emphasized that auditing contract performance does not constitute an indictment of the Syrian Petroleum Company or its employees. Individual responsibility will be determined strictly by the final investigation results. The company, he added, is cooperating fully by providing all requested documentation, and any legal referrals will depend on the investigation’s final findings.

SPC’s Position on the Contracts

The Syrian Petroleum Company rejected the notion that the contracts under review form a single case, noting that each was signed under different circumstances.

According to SPC, several contracts were executed during exceptional conditions surrounding the recovery of oilfields and facilities in the eastern region. These operations took place amid complex security and logistical challenges that required urgent measures to protect wells, facilities and crude oil, and to treat contaminated water before it reached the Euphrates River.

The company also denied claims that all contracts were awarded through direct negotiation. It stated that many were conducted through formal tenders and competitive bidding processes involving technical and financial evaluations. It added that direct contracting, when permitted under standard regulations, does not inherently indicate corruption.

The Three Companies at the Center of the Debate

Local sources identified “Star Petronova,” “Golcon,” and “Ta’zeez” as firms linked to the disputed contracts.

CEO Youssef Kablawi publicly defended the agreements, denying corruption or procedural violations. He said the contracted companies possessed the technical capacity required for the work and that most personnel involved were locals from the eastern region.

An informed source familiar with the file told Ultra Syria that the issue is not the existence of contracts with private firms, but rather the auditing of execution stages and compliance with contractual terms.

“The figures cited in media coverage should not be treated as a definitive loss to the state before investigations are concluded and documents, books, quantities and executed works are fully audited,” the source said. He added that investigators aim to distinguish administrative or technical observations from violations that may carry financial or criminal liability.

Status of CEO Youssef Kablawi

Responding to rumors about Kablawi’s fate, the Syrian Petroleum Company denied that its CEO had been detained or referred for investigation. No official decree has relieved him of his duties. On September 29, sources confirmed that Kablawi was actively performing his responsibilities and appeared in his capacity as CEO during an official event related to the Arab Gas Pipeline in rural Homs.

Kablawi also addressed a separate public controversy stemming from comments he made during a media appearance defending the company’s contracts. His remarks about public reaction on social media drew criticism, prompting him to issue a video apology on September 28.

Broader Oversight in the Energy Sector

The current probe coincides with wider regulatory reviews across Syria’s energy sector. In August, the Central Authority for Inspection and Control announced findings of procedural violations, operational gaps and management issues related to oil production, transport and calibration in Deir ez‑Zor fields, estimating damages to public funds at approximately $28 million. That investigation resulted in the suspension and referral of several officials.

Where the File Stands Now

Based on official statements and available data, the situation can be summarized as follows:

• A formal regulatory audit of specific oil‑sector contracts is ongoing.
• The $104 million figure represents a precautionary asset freeze on contracting firms, not proven embezzlement.
• SPC considers the $110 million figure a preliminary estimate of potential damage, not an established loss.
• No final rulings have assigned individual liability.
• No official decision has been issued regarding the dismissal or detention of CEO Youssef Kablawi.

The final outcome will depend on the results of regulatory and judicial procedures once investigations conclude.

 

This article was translated and edited by The Syrian Observer. The Syrian Observer has not verified the content of this story. Responsibility for the information and views set out in this article lies entirely with the author.