Two observations on the AANES 2024 budget, which was released yesterday.

First: Thanks to oil, the forecast revenues suggest that public spending in AANES areas is around $335 USD per capita, almost 70% higher than in regime-held Syria.

Given the relative advantage in natural resources, the foreign backing, and the more limited impact of sanctions, one would think the AANES should do much better, but building institutions from scratch is a daunting task; it gets much worse when combined with institutional discrimination and corruption.

Second: Assuming that 75% of AANES's revenues come from oil (which aligns with earlier official statements) at an output level of 90k barrels per day, this suggests that a barrel of oil sells for only $15 USD.

This is less than 20% of the prevailing price in global markets. While subsidies to local consumption play a role, much of the reason for the low prices is the legal status of that oil, viewed by most consumers as being smuggled.

Assumptions:

Damascus Government:

Revenues for 2024: 35.5 trillion SYP

Assumed exchange rate over 2024: 14,500

Assumed population: 12.5 million

AANES

Revenues: 670 million USD

Population: 2 million.

Oil

Global oil price average over Jan-May 2024: $80