ISIS’s Multimillion-Dollar Oil Deals With Assad Regime Uncovered in U.S. Special Forces Raid
Newsweek: The Syrian regime of Bashar al-Assad has negotiated multimillion-dollar oil deals with the Islamic State militant group (ISIS), new documents retrieved from a U.S. raid against the radical Islamists’ oil chief have revealed.
A U.S. special forces raid on ISIS’s oil minister—known by his nom de guerre Abu Sayyaf—in May 2015 saw the extraction of thousands of documents implicating his oil operation with that of the Assad regime, with revenue from the sale of oil to Damascus helping the group to reach a peak of $40 million a month in oil revenue, according to documents seen by The Wall Street Journal.
Sayyaf led the group’s oil ministry, known as the Diwan of Natural Resources, and used deals with the Syrian regime to boost the division’s income, contributing 72 percent of $289.5 million the group earned in natural-resource revenues in the six months preceding February 2015.
A document identified as Memo No. 156, dated February 11, 2015, from the trove of documents extracted from Sayyaf’s Deir Ezzor hideout shows that the Tunisian national requested assistance from an unknown party on how to build investment links with businessmen allied to the Assad regime.
The document states that ISIS already had agreements in place with Damascus that permitted trucks to move from oil fields under the authority of the regime to travel through ISIS-controlled territory. Two former ISIS oil managers also told the The Wall Street Journal that the group had made deals with businessman connected to the Syrian regime.
In the raid, U.S. special forces traveled from Iraq to eastern Syria, where they killed ISIS militants guarding his compound before assassinating Sayyaf. The forces took his wife Umm Sayyaf into custody and transferred her to the hands of Kurdish control.
In their sweep across eastern Syria in late 2013 and early 2014, ISIS seized some of Syria’s key oil fields in the Deir Ezzor province, such as al-Tanak and al-Omar. The group lost its first major oil field in Syria, al-Jasbah, where it was producing 3,000 barrels of oil a day, to Syrian-Kurdish forces in January. The U.S.-led coalition is also targeting the group’s oil fields, significantly reducing its ability to refine lucrative oil and sell it to shadowy buyers.
In 2014: Officials from the Iraqi oil industry have said that ISIS reaps $1 million per day in Iraq in oil profits and that if they get the Syrian fields in [areas where they’re advancing], the total would be $100 million per month for both Iraq and Syria combined. They sell it for $30 a barrel because it’s a black market. It’s not pegged to international standards for oil prices, which are over $100 a barrel. The oil is bought through Turkey from Syria, and it’s sold to black market traders who function throughout the Levant.
ISIS’s strategy seems to have evolved around generating income. ISIS raises money in several ways, but oil is certainly a part of that. For a long time, they avoided having much direct confrontation with the regime. They generally tended to turn their fire against other rebel groups. They had been selling to the regime, or basically anyone who’d pay for it. But recently it seems like they are taking a more aggressive approach, like with the attack on Shaar. Were they just attacking it to destroy it [to hit the regime], or to take it over and continue selling gas? It’s not clear what their intention was.
If ISIS truly has destroyed fields there, it means the [regime’s] gas supply will be cut off. It’s already down to half of pre-war levels, and this will cause more power cuts and electricity cuts in Damascus. It means the regime will have to use more expensive fuel from Iran. It means more suffering for [civilians], and this perhaps will undercut support there for the regime. And it makes it very hard to have any prospect of the economy recovering.
ISIS, which has an illegal oil export scheme that derives revenue. It seems now that [oil in Syria] is up for grabs and ISIS started this trend [of fighting for it]. It is likely that other groups such as Nusra will try to follow.
As the Islamic State is established, it’s clear that ISIS wants to have all parts of their government and revenue sources well organized, and that energy exports are part of this scheme. The scheme includes the collection of taxes, but also other black market activities like trade in other illegal goods the group plunders from the land it captures. Given the call by [ISIS leader Abu Bakr] Baghdadi on the first day of Ramadan –asking for consolidation of the state and the recruitment of individuals to help run that state – you have to figure that the energy sector figures into his planning. Read full interview in context here.