South Sudan is facing a looming economic and political crisis after Sudan’s army threatened to block oil exports that flow through its territory, a move that could cripple the landlocked nation’s primary revenue stream. The warning, issued on May 21, 2025, comes amid deepening tensions between the two countries and growing instability along their shared border.

Sudan’s military leadership accused South Sudan of collaborating with rebel groups hostile to Khartoum, claiming that Juba is providing logistical and material support to factions fighting the Sudanese Armed Forces (SAF). Sudan’s army spokesman said the oil pipeline, which runs from South Sudan’s oil fields to Port Sudan on the Red Sea, could be shut down “at any moment” if alleged interference continues.

“We will not tolerate actions that threaten our national security. South Sudan must choose peace over provocation,” a senior SAF official told local media.

Oil Lifeline in Jeopardy

South Sudan’s economy is heavily reliant on oil, with over 90% of its government revenue coming from crude exports. The country has no coastline and depends entirely on Sudan’s pipeline infrastructure to reach international markets. Any disruption could lead to economic collapse, salary arrears for public workers, and the suspension of critical services.

The government in Juba has denied the allegations, calling them “baseless and inflammatory.” South Sudan’s Information Minister Michael Makuei Lueth said that Juba remains committed to non-interference and urged Sudan to resolve disputes through diplomacy.

“This is a dangerous escalation. Shutting down the pipeline would hurt both nations and the entire region,” Makuei warned.

Border Tensions and Rebel Activity

Clashes between Sudanese government troops and rebel factions near the Sudan–South Sudan border have intensified in recent weeks. Sudanese officials accuse the Sudan People’s Liberation Movement-North (SPLM-N), which has historic ties to South Sudan, of operating with tacit support from Juba.

Satellite imagery and local reports suggest increased military activity along the Heglig oil zone, a flashpoint area that has seen past skirmishes between the two nations. Humanitarian agencies have raised concerns over civilian displacement and restricted aid access.

Regional and International Concern

The threat to halt oil flows has triggered alarm across East Africa and among international donors, many of whom have invested in South Sudan’s fragile peace process following years of civil war. The Intergovernmental Authority on Development (IGAD) has called for urgent dialogue, while the United Nations warned that an oil disruption would exacerbate food insecurity and displacement in South Sudan.

“A pipeline shutdown would not only devastate South Sudan’s economy but could unravel its already fragile political stability,” said David Shearer, former UN envoy to South Sudan.

The African Union and U.S. State Department have both urged restraint and offered to mediate the crisis. A senior U.S. official warned that regional instability could lead to “a cascading humanitarian disaster.”

Economic Fallout Looms

South Sudan’s currency has already shown signs of depreciation amid fears of lost oil revenue. Civil servants and soldiers — many of whom have gone unpaid for months — could face further delays, increasing the risk of unrest in Juba and across the oil-producing states.

Additionally, Chinese and Malaysian companies operating the oil fields may scale down operations if transport guarantees are not secured. Insurance premiums on crude shipments through Sudan have reportedly surged in the last 48 hours.

What Comes Next?

• South Sudan is seeking emergency diplomatic intervention via IGAD and the African Union.
  
• Sudan’s military leaders are under pressure to show strength domestically as internal conflicts rage.
  
• Talks are being proposed in Addis Ababa or Nairobi to defuse tensions.
  
• A prolonged pipeline shutdown could trigger a refugee crisis and regional fuel shortages.

With both countries navigating internal crises and mutual distrust, the standoff over oil threatens to escalate into a broader regional emergency — one that could undermine peace, plunge millions deeper into poverty, and destabilize one of Africa’s most fragile frontiers.

Source; Al Jazeera