ISIS using oil to fund terror

The Brookings Institution has posted a report that addresses the manner in which ISIS uses oil to fund terror. US intelligence officials believe that the Islamic State group is making as much as US$ 3 million/d. most of it through the illegal oil trade.

Luay al-Khatteeb, a visting fellow at the Brookings Institution’s Doha Center in Qatar and director of the Iraq Energy Institute said in an interview with the WorldPost that he believes the progression of ISIS into the illegal oil trade has been gradual.

‘ISIS and other extremist groups first took over oil assets in Syria during the past three years of conflict there. Most of the oil assets they captured are in the eastern part of Syria and many of them shifted hands several times…However, as ISIS intensified its operations and expanded its reach in Syria and Iraq, most of the key oil assets in Syria came into their hands”, al-Khatteeb said.

In order to operate the oil fields the groups rely on the cooperation of the locals (who have been running these operations before). However, al-Khatteeb highlights that the group has suffered a significant loss in capacity: ‘ISIS is in control of 60% of Syria’s oil production capacity. Pre-conflict, Syria’s production capacity stood at 385 000 – 400 000 bpd, so 60% would be more than 200 000 bbls. But from what is being reported out of Syria, ISIS appears to only be producing around 50 000 bbls’.

‘It is also important to note that not all of these fields are staffed by ‘ISIS personnel’, but by other insurgencies or entities that are willing to cooperate with the group. Because of these different operators, the price per barrel varies from US 20 – US$ 60’.

ISIS sells most of the oil to the 8 million people living in ISIS controlled territory, according to Al-Khatteeb. The oil is either refined in small facilities or exchanged across the border, mostly in Turkey, for refined oil products. The southern corridor of Turkey has thus become a gateway for oil products and illicit trading that contribute to transnational terrorism, Al-Khatteeb suggests. The Turkish Government says that it’s doing its best to shut down the trade of illegal oil, however it is proving difficult.

According to Al-Khatteeb, ‘the returns of this trade have contributed to the expansion of these terrorist groups. At the beginning of June, most estimates said about 10 000 fighters had joined ISIS. Just 10 days ago, the CIA put the number at 31 000. It is now believed that oil revenues have contributed significantly to the expansion of recruitment.

Adapted from a report by Emma McAleavey.

Read the article online at: https://www.hydrocarbonengineering.com/gas-processing/01102014/isis-using-oil-to-fund-terror-1330/