Oil Shut Down Risks Humanitarian Catastrophe In South Sudan - UN

Published: Feb 02, 2012

By Sarah Kent
Of DOW JONES NEWSWIRES


LONDON (Dow Jones)--South Sudan's decision to shut down its oil production could have disastrous consequences for the new country's population, pushing large numbers into food insecurity, Lise Grande, United Nations Resident and Humanitarian Coordinator in South Sudan told Dow Jones Newswires Thursday.

Even before the oil shut down the latest analysis by the UN showed South Sudan was facing a food deficit almost double what it was last year, placing some 4.7 million people in a position of moderate to severe food insecurity.

South Sudan's economy relies heavily on revenue from oil exports. However, in January the government moved to shut down oil production amid a furious dispute with Sudan over oil transit fees.

"What we're looking at even before the oil shut down is a very precarious situation," Grande said, adding that the impact of an oil shut down on top of this could be "almost catastrophic."

South Sudan split from its northern neighbor in July, taking with it some 75% of the former country's oil fields. However it remains dependent on pipelines in Sudan to export its oil. The two sides have been unable to reach an agreement on how much South Sudan should pay to use the infrastructure, resulting in an increasingly intense dispute.

Last Sunday, UN chief Ban Ki-Moon warned that the oil crisis between the two countries had become a major threat to regional peace and security.

-By Sarah Kent, Dow Jones Newswires;4420-7842-9376; sarah.kent@dowjones.com