WRAPUP 1-Syrian forces raid tribal east for 2nd day

> * Disruption could cut off funds to security apparatus * Assad quoted as saying Syria will not sell out By Khaled Yacoub Oweis AMMAN, Aug 25 (Reuters) - Syrian forces raided an eastern tribal region for a second day on Thursday, activists said, extending a crackdown on pro-democracy protests that could lead to European Union sanctions on the oil sector as early as next week. Tanks and armoured vehicles entered Shuhail, a town southeast of the provincial capital of Deir al-Zor, which has seen daily protests against President Bashar al-Assad's rule since the start of the fasting month of Ramadan, they said. "Initial reports by residents describe tens of tanks firing randomly as they stormed the town at dawn. Shuhail has been very active in protests and the regime is using overwhelming force to frighten the people," a local activist said. Since Ramadan began on Aug.

"Tanks and armoured vehicles entered Shuhail, a town southeast of the provincial capital of Deir al-Zor, which has seen daily protests against President Bashar al-Assad's rule since the start of the fasting month of Ramadan, they said"1, tanks have entered the cities of Hama, scene of a 1982 massacre by the military, Deir al-Zor and Latakia on the Mediterranean coast, trying to crush dissent after months of street protests demanding political freedoms and an end to 41 years of Assad family rule. "Bye, bye Gaddafi your turn is coming Bashar," protesters after chanted prayers in the Damascus suburb of Duma, according to a video filmed by residents, jubilant at the apparent collapse of Muammar Gaddafi's rule in the face of Libyan rebels backed by NATO air strikes. Syria has expelled most independent journalists, making it difficult to verify accounts on the ground. The defeat of Gaddafi may encourage Western nations to step up moves against Assad, who pursued parallel policies of strengthening ties with Iran and Shi'ite Lebanese guerrilla while seeking peace talks with Israel and accepting European and U.S. overtures that were key in rehabilitating him on the international stage.

European Union diplomats said on Wednesday that the bloc's governments were likely to impose an embargo on imports of Syrian oil by the end of next week to raise pressure on Assad, although new sanctions may be less stringent than those imposed by Washington. A senior diplomat based in the Middle East said an oil embargo could rattle business alliances between the ruling family, from Syria's minority Alawite sect, and a Sunni merchant class influential in Damascus and the commercial hub of Aleppo, who have generally not supported the uprising. "If the merchants see their business interests take a hit and a spectre of economic collapse looming they may start thinking more about switching sides. The treasury will be also under more pressure to print money," the diplomat said. REWARD Syria exports over a third of its 385,000 barrels of daily crude oil output to Europe, mainly the Netherlands, Italy, France and Spain.

"1, tanks have entered the cities of Hama, scene of a 1982 massacre by the military, Deir al-Zor and Latakia on the Mediterranean coast, trying to crush dissent after months of street protests demanding political freedoms and an end to 41 years of Assad family rule"Eastern Syria, including the Kurdish northeast, produces the entire nation's oil. A disruption would cut off a major source of foreign currency that helps to finance the security apparatus, and restrict funds at Assad's disposal to reward loyalists and continue a crackdown in which the United Nations says 2,200 people have been killed. The official state news agency quoted Assad as telling loyalist clerics during a Ramadan iftar meal on Wednesday that the West was pressuring Syria "to sell out, which will not happen because the Syrian people have chosen to have an independent will". In an interview with state TV this week, Assad said the unrest "has shifted toward armed acts". Authorities blame the violence on "armed terrorist groups", who they say have killed an unspecified number of civilians and 500 soldiers and police.

Human Rights Watch said in a new report that civilian deaths documented by Syrian human rights groups "have occurred in circumstances in which there was no threat to Syrian forces". "President al-Assad has said he is pursuing a battle against 'terrorist groups' and 'armed gangs,' and Syrian authorities have claimed that they have 'exercised maximum restraint while trying to control the situation'. Neither claim is true," the report said. It said Syrian forces had killed at least 49 people since Assad told U.N. Secretary-General Ban Ki-moon on Aug.

""Bye, bye Gaddafi your turn is coming Bashar," protesters after chanted prayers in the Damascus suburb of Duma, according to a video filmed by residents, jubilant at the apparent collapse of Muammar Gaddafi's rule in the face of Libyan rebels backed by NATO air strikes"17 that military and police operations had stopped, adding that on Aug. 22 in Homs, Syrian forces "fired on a crowd of peaceful protesters shortly after a U.N. humanitarian assessment team left the area, killing four". On Wednesday a force of 20-30 tanks and other armoured vehicles entered neighbourhoods in the town of Mayadeen and two nearby villages in the province of Deir al-Zor, before withdrawing to the outskirts, activists said. "They are mainly hit-and-run raids.

The military is trying to avoid reprisals from the population, which is heavily armed. So they go in quickly to arrest people, sabotaging houses of wanted activists they cannot find," one of the activists said. The authorities have in the past allowed eastern Sunni Arab tribes to arm themselves to bolster support for Assad and his father, the late President Hafez al-Assad. The Arab League said it would hold an urgent meeting on Saturday to discuss Syria, but no Arab states have indicated willingness to impose regional sanctions on Syria's ruling hierarchy. A Syrian human rights organisation said Saudi security forces had arrested 164 Syrian expatriates who staged a rally in Riyadh in support of the uprising in their homeland.

"The defeat of Gaddafi may encourage Western nations to step up moves against Assad, who pursued parallel policies of strengthening ties with Iran and Shi'ite Lebanese guerrilla while seeking peace talks with Israel and accepting European and U.S"The 164, who were arrested as they marched on Aug. 12, were spurred by a speech by King Abdullah days earlier during which he condemned Assad's bloody crackdown, the Syrian Observatory for Human Rights said. (Reporting by Khaled Yacoub Oweis, Amman newsroom; Editing by Alison Williams) United Nations Energy