A well-oiled machine: The meticulously-run operation of ISIS

BEIRUT — Oil is the black gold that funds the Islamic State, the jihadi organisation in control of swaths of Syrian and Iraqi territory, fuelling its war machine, providing electricity and giving the fanatical jihadis critical leverage against their neighbours.

The Islamic States’s strategy has rested on projecting the image of a state in the making, and it is attempting to run its oil industry by mimicking the ways of national oil corporations.

According to Syrians who say Islamic State (ISIS) tried to recruit them, the group headhunts engineers, offering competitive salaries to those with the requisite experience, and encourages prospective employees to apply to its human resources department.

A roving committee of its specialists checks up on fields, monitors production and interviews workers about operations.

It also appoints ISIS members who have worked at oil companies in Saudi Arabia or elsewhere in the Middle East as “emirs”, or princes, to run its most important facilities, say traders who buy ISIS oil and engineers who have worked at Isis-controlled fields.

Some technicians have been actively courted by ISIS recruiters. Rami — not his real name — used to work in oil in Syria’s Deir Ezzor province before becoming a rebel commander. He was later contacted by an ISIS military emir in Iraq via WhatsApp.

“I could choose whatever position I wanted, he promised me,” he said. “He said: ‘You can name your salary’.” Sceptical of the ISIS project, Rami ultimately turned down the offer and fled to Turkey.

ISIS also recruits from among its supporters abroad. In the speech he gave after the fall of Mosul, ISIS leader Abu Bakr Baghdadi called not only for fighters but engineers, doctors and other skilled labour.

The group recently appointed an Egyptian engineer who used to live in Sweden as the new manager of its Qayyara refinery in northern Iraq, according to an Iraqi petroleum engineer from Mosul, who declined to be named. The central role of oil is also reflected in the status it is given in ISIS’ power structures.

The group’s approach to government across the territories it controls is highly decentralised. For the most part, it relies on regional walis — governors — to administer territories according to the precepts laid down by the central shura.

However, oil — alongside ISIS’ military and security operations and its sophisticated media output — is centrally controlled by the top leadership. “They are organised in their approach to oil,” said a senior western intelligence official.

“That’s a key centrally controlled and documented area. It’s a central shura matter,” he added, referring to ISIS’ ruling “cabinet”.

Until recently, ISIS’ emir for oil was Abu Sayyaf, a Tunisian whose real name, according to the Pentagon, was Fathi Ben Awn Ben Jildi Murad Tunisi, and who was killed by US special forces in a raid in May this year.

According to US and European intelligence officials, a treasure trove of documentation relating to ISIS’ oil operations was found with him.

The documents laid bare a meticulously run operation, with revenues from wells and costs carefully accounted for.

They showed a pragmatic approach to pricing too, with ISIS carefully exploiting differences in demand across its territories to maximise profitability.

Oversight of the oil wells is carefully controlled by the Amniyat, ISIS’ secret police, who ensure revenues go where they should — and mete out brutal punishments when they do not.

Guards patrol the perimeter of pumping stations, while far-flung individual wells are surrounded by protective sand berms and each trader is carefully checked as he drives in to fill up.

At the Al Jibssa field in Hassakeh province, north-eastern Syria, which produces 2,500-3,000 bpd, “about 30-40 big trucks a day, each with 75 barrels of capacity, would fill up”, according to one Hassakeh oil trader.

WINNING CARD

But the biggest draw is Al Omar. According to one trader who regularly buys oil there, the system, with its 6km queue, is slow but market players have adapted to it.

Drivers present a document with their licence plate number and tanker capacity to ISIS officials, who enter them into a database and assign them a number.

Most then return to their villages, shuttling back to the site every two or three days to check up on their vehicles. Traders say that towards the end of the month, some people come back and set up tents to stay close to their trucks while they wait their turn.

Once in possession of Al Omar’s oil, the traders either take it to local refineries or sell it on at a mark-up to middlemen with smaller vehicles who transport it to cities further west such as Aleppo and Idlib.

ISIS’ luck with oil may not last. Coalition bombs, the Russian intervention and low oil prices could put pressure on revenues.

The biggest threat to ISIS’ production so far, however, has been the depletion of Syria’s ageing oilfields. It does not have the technology of major foreign companies to counteract what locals describe as a slow drop in production.

ISIS’ need for fuel for its military operations means there is also less oil to sell in the market.

For now, though, in ISIS-controlled territory, the jihadis control the supply and there is no shortage of demand.

“Everyone here needs diesel: for water, for farming, for hospitals, for offices. If diesel is cut off, there is no life here,” says a businessman who works near Aleppo.

“ISIS knows this (oil) is a winning card.” FINANCIAL TIMES

This is the last of a two-part series.