Discussions on cooperation between Tripoli, Lebanon, and Banias, Syria, gained momentum during the official visit on July 26, 2026, which brought together Lebanese Prime Minister Nawaf Salam and the Iraqi President and Prime Minister, as the head of a high-level ministerial delegation, to conclude bilateral talks and enhance prospects for cooperation between the two countries.

They have revived the idea of the Iraq-Syria-Lebanon oil pipeline, which could become a major energy project in the Eastern Mediterranean, contingent upon overcoming political and investment challenges.

Recent discussions have evolved to focus on creating an integrated regional oil system that begins in Iraq, moves through Syria, and reaches the Eastern Mediterranean coast, rather than just restarting the Tripoli refinery or upgrading Baniyas facilities.

The fundamental economic question has shifted from determining which port is better to assessing whether Tripoli and Baniyas can collaboratively form a competitive energy hub in the region.

Building an Integrated Regional Energy Hub

The Baniyas refinery has a refining capacity of around 120,000 barrels per day, significantly exceeding the Tripoli refinery’s design capacity. However, a project capable of processing two million barrels daily necessitates an extensive ecosystem that includes storage, transhipment, marine services, ship bunkering, petrochemical industries, and handling terminals.

This is where Tripoli’s comparative advantage becomes evident due to its historic oil facilities, cost-effective rehabilitative storage tanks, a commercial port, a special economic zone, and available land for industrial expansion, all in proximity to Lebanese and Syrian markets.

If Tripoli becomes a hub for storage, re-export, and logistics while Baniyas focuses on refining, the project could transform from competitive to collaborative, creating an integrated value chain that benefits both cities. This approach reflects the models used by top global energy hubs.

Networked Logistics Drive High-Yield Energy Hubs

In Europe, the Port of Rotterdam and Antwerp collaborate within a network to handle over 700 million tons of cargo yearly, focusing on various roles such as storage and logistics.

In Asia, Singapore has gained prominence by managing the oil value chain instead of owning oil fields. Similarly, Fujairah in the UAE has become the second-largest oil storage hub, with over 70 million barrels of capacity, by integrating with other ports rather than competing.

The modern economy gauges port success by the value added within a regional network rather than the number of ships diverted from neighbouring ports. Studies by global energy companies show that storage and maritime transport services yield more stable returns compared to refining operations, as their revenues rely on trade volumes and service fees rather than volatile oil refining margins influenced by crude prices and global demand.

Every million barrels of storage capacity can generate significant annual income from storage and handling fees, not including additional returns from re-exports, vessel bunkering, and logistics services.

Constructing a new refinery capable of processing more than 100,000 barrels per day may require $5 billion to $7 billion in investment, whereas refurbishing existing facilities is significantly cheaper. Therefore, it is economically sensible to optimise existing facilities rather than duplicating investments, maximising returns on capital.

Synergy & Stability: Keys to a Levant Energy Hub

Success in this scenario depends on political stability in Syria, a favourable investment climate in Lebanon, legal protections for international companies, and regional agreements to facilitate energy operations without military conflicts and sanctions.

Events in Baghdad are pivotal as a new cross-border economic project among Iraq, Syria, and Lebanon emerges, promising mutual benefits and redefining the Eastern Mediterranean coast’s role in the global energy landscape.

Essentially, the key question is whether the Levant will understand that economic integration offers more benefits than political rivalry, rather than focusing solely on the outcomes for Tripoli or Baniyas.

If this project succeeds, it could establish a critical energy and logistics hub in the Eastern Mediterranean, coinciding with global shifts in energy security and supply chains. This presents Lebanon with a long-awaited opportunity to re-enter the economic arena by leveraging its geographic advantages, rather than depending solely on its banking sector.