By: Ecofin Agency

South Sudan has issued irrevocable allocation letters to oil trader BB Energy. The country then confirmed that two crude oil cargoes will be delivered before the end of November 2026.

The commitment was announced by BB Energy on June 18, one day after a London court upheld an injunction against the South Sudanese government. The move marks a partial resolution to a dispute that has stretched on for more than a year. In February 2025, BB Energy advanced $100 million to South Sudan under a prepayment agreement that guaranteed the delivery of five crude oil cargoes during the year.

More than a year later, only one cargo had been delivered. As a result, BB Energy took legal action in the United Kingdom. On May 15, a London court issued an injunction preventing South Sudan from entering into new oil prepayment agreements or pledging future crude cargoes to other creditors until the dispute was resolved.

On June 17, Judge Mark Pelling ruled in favor of BB Energy and refused to lift the injunction. He found that the trader was entitled to the order unless there were compelling reasons to remove it, including evidence that it unfairly harmed an innocent third party.

Three other commodity traders—BGN, EuroAmerican, and Chiangwei—had also asked the court to lift the injunction so they could secure cargoes tied to their own prepayment agreements with South Sudan. The judge rejected those requests, noting that the companies had been warned by BB Energy's lawyers as early as December 2025 and had proceeded with the transactions despite being aware of the dispute.

A Long-Running Debt Problem

The case highlights a broader challenge facing South Sudan, which has repeatedly struggled to meet commitments made under oil-backed financing arrangements.

According to Global Trade Review (GTR), Qatar National Bank (QNB), Afreximbank, and UAE-based trader Nasdec General Trading have collectively extended more than $2 billion in similar loans to South Sudan. The country has not fully met all of its delivery obligations under those agreements. Oil remains the backbone of South Sudan's economy, accounting for between 85% and 90% of government revenue, according to a 2025 analysis by African Security Analysis.

A two-day hearing is scheduled for early July to determine whether the injunction should remain in place as the broader legal dispute moves forward.