By Christopher Specht ‘19
The Islamic State has been moving toward sustaining itself and its brand of extremism largely through its sale of oil. Oil is its largest source of income, which is used for infrastructure, buying weapons, and paying its fighters. As the group became more powerful and acquired more oil-rich territory in Iraq and Syria, it became clear that The Islamic State’s oil industry is becoming increasingly sophisticated and profitable. Information regarding just how profitable its oil operations have been, however, has been sparse until a report from the Associated Press was released last week.According to AP, the Islamic State makes up to $50 million per month in oil revenues. That means that about half a billion dollars every year is being used to sustain and grow one of the world’s most powerful and brutal terrorist organizations. AP’s most interesting source, however, came in the form of a financial report from Diwan al-Rakaaez, IS’s Finance Ministry. The report showed that with over 250 oil wells in Syria and likely over a hundred more in Iraq, the Islamic State is extracting anywhere from 40,000 to 50,000 barrels of crude oil per day, which are being sold at around $35 per barrel. This is much cheaper than the legal price of oil, which is currently trading just above $46 per barrel. IS’s oil refinery is fairly rudimentary, with several small refineries in trailers. To manage its oil assets, IS has acquired the necessary equipment and employed engineers and workers from abroad, in addition to multiple senior officials from Iraqi oil companies. According to an anonymous US official, management of the oil fields has been “increasingly sophisticated”, which explains the success IS has had with oil despite airstrikes from multiple countries such as the US and Russia.The implications for the future are mixed. On one hand, the Islamic State’s success with oil is incredibly concerning. The hundreds of millions of dollars that IS makes every year is being dedicated to building their caliphate and bolstering their forces. The increasing sophistication of IS makes airstrikes alone insufficient to defeating this terror group. While IS’s newfound oil revenues are a strength for the Islamic State, it also presents some big weaknesses that IS’s enemies have already begun to capitalize on. On October 19th, airstrikes on an oil facility near the Syrian city of Deir Ezzor were completely successful in destroying all 26 of its intended targets. As such airstrikes continue, it will become harder for IS to increase their capacity for oil production. In addition, the international community could also target the supply lines and buyers of IS’s oil, which would devastate the group financially. AP’s revelation may seem threatening at first, but perhaps it presents the key for finally defeating the Islamic State.Sources:http://bigstory.ap.org/article/061e7a83299644868c920bed0667eb9c/despite-us-led-campaign-islamic-state-rakes-oil-earningshttps://www.rt.com/news/319510-isis-oil-50mln-month/http://english.alarabiya.net/en/News/middle-east/2015/10/22/Russia-says-hits-ISIS-supply-route-from-Iraq-to-Syria-13.htmlhttp://www.oil-price.netImage: http://osnetdaily.com/2015/08/britains-secret-ties-to-governments-firms-behind-isis-oil-sales/