(Reuters) - Syrian businessmen and trade officials say they are worried the economic lifeline provided byIranis under strain from plunging oil prices, despite public messages of support from Syria's strongest regional ally.Syrian President Bashar al-Assad has relied on oil-producing Iranto help him fight a nearly four-year-old civil war and also prop under a currency under pressure.
If it had not been for Iranian support we could not have survived the crisis," a senior Syrian trade official said from Damascus, requesting anonymity.
"It was Iranian support that has been the most important. In return, we are promising them more and more, and opening more and more doors for them to invest inSyria," he said.
Oil production inSyria, which is under U.S. and European sanctions, has dropped sharply since the start of the conflict and as insurgents have taken over energy installations.
In July last year,IrangrantedSyriaa $3.6 billion credit facility to buy oil products, according to officials and bankers at the time. Another $1 billion went for non-oil products.
But with the global oil price down 50 percent since June,Syria- where rebels have seized up to a third of the country - has sought reassurances Tehran will maintain the status quo.
The public message has been an overwhelming "yes".
Syrian Prime Minister Wael al-Halqi visited Tehran this week to boost Iranian support forSyria, in particular ensuring Iranian petroleum products reach the Syrian market, Syrian state news agency SANA reported.
Irans economic support forSyriawill continue incessantly, said Iran's Vice President Eshagh Jahangiri on Tuesday after meeting Halqi, according to Iran's state news agency IRNA.
But there were no detailed announcements of joint ventures or oil deals as followed previous such visits in the past.
CURRENCY FALLS
The Syrian pound, which fell around 70 percent since the civil war began in 2011, lost another 10 percent over the past fortnight alone.
Dealers said the fall was driven by several factors, including a realization that U.S. strikes on Islamic State were not helping Assad as much as had been expected. But a major one was that a falling oil price had made them fearIranwould be less able to help shore up its ally'seconomy.
Shi'iteIranhas deep ties withSyria. Assad is an Alawite, an off-shoot of Shi'ism, and Tehran sees him as a bulwark against Sunni Saudi Arabia's influence in the region.
In the past, Assad streamedIranian support to Shi'ite Hezbollah in neighboring Lebanon, while now, the militia gets funds directly fromIranto fight Assad's enemies at the front.
Damascus-basedbusinessmen and bankers say theSyrian Central Bank is worried about the drop in oil prices affecting Iranian support forSyria.
Irandeposited $500-$750 million in Syria's Central Bank more than a year ago that has been used by the authorities to help stabilize the pound, according to two senior bankers with close ties with central bank officials.
In recent weeks, the bank sold dollars shore up the pound in some of the largest market interventions since the start of the crisis, the two bankers said.
Syrian officials could not be reached for comment on Thursday or Friday.
There is a general consensus by traders, bankers and businessmen that the drop in Iranian oilearningswill have untold consequences on level of economic supportin the long term despite little impact on business ties so far.
The 50 percent steep fall in oil prices will break Irans back, not just the level of support for Assad, a prominent member of the Damascus Chamber of Industry said, also requesting anonymity.
OIL DISRUPTIONS
Iranians have delivered turbines for power plants and have been promised contracts to rebuild housing, roads and other infrastructure destroyed by the war on the understanding that Tehran wouldfinancethem in return for equity shares.
All this could be jeopardized. Much, however, will depend on how long oil prices will continue to stay depressed, they say.
Two Syrian businessman who sell products including olive oil and garments to Iranian private tradersare worried they may defer payments.
A member of the Syrian Chambers of Industry from the city of Aleppo said he understood the main item on Prime Minister Halqis shopping list in Tehran was bigger quantities of petroleum products imports.
Growing power cuts have hit government-controlled areas as more gas fields go out of action, forcing the authorities to rely even more on imports of fuel for its power plants.
Islamic State militant control of some of the border crossings withIraqhas disrupted the flow of tens of thousands of barrels of crude fromIraqthat were delivered overland by oil tankers, an oil trader based in the region said.
Four Iranian tankers have discharged cargoes of gasoline products in the last two months in Syria's ports, traders said. But they did not end shortages accentuated by higher demand in the winter season, prompting small protests in Alawite villages near the port of Latakia, the heartland of Assad support.
By Reuters
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