How Islamic State uses Syria's oil to fuel its advances

Thu Sep 18, 2014 12:09pm EDT
 
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* Islamic State tightens grip on oil-producing areas

* Militants estimated to get up to $2 mln in daily oil revenues

* Traders seeking profit re-sell oil in government-held areas

By Suleiman Al-Khalidi

AMMAN, Sept 18 (Reuters) - In an oil field in northeastern Syria, a queue of trucks lines up daily to load crude sold cheaply by Islamic State militants who have hijacked parts of the country's energy industry in their bid to build a caliphate.

Sales at Shadada field, described by an oil trader, are just one example of how the group, which has seized land in war-torn Syria and neighbouring Iraq, is creating its own economy through a series of pragmatic trades.

It is cutting deals with local traders and buyers, even businessmen who support Syrian President Bashar al-Assad, and some of its oil has made its way back to government buyers through a series of middlemen.

"Islamic State makes not less than $2 million daily that allows them to pay salaries and maintain their operations," said a former Western oil executive who worked in a foreign oil firm operating in Syria before the crisis and who is familiar with the nascent oil market.

The United States, which has been bombing Islamic State positions in Iraq, has said it is prepared to extend the campaign into Syria, which has been racked by civil war for more than three years, and has said it will train more than 5,000 Syrian rebel fighters to counter the advancing group.   Continued...