syria oil map: the journey of a barrel of isis oil

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Inside Isis Inc: The journey of abarrel of oil

Isis controls most of Syrias oil fields and crude is the militant group'sbiggest single source of revenue. Here we follow the progress of a barrel of

oil from extraction to end user to see how the Isis production system

works, who is making money from it, and why it is proving so challenging

to disrupt.

By Erika Solomon, Robin Kwong and Steven Bernard October 14, 2015

TURKEY

MosulSinjarKURDISTAN

REGIONAL

GOVERNMENTAleppo Raqqa

Deir Ezzor

al-QaimS Y R I AEBANON IRAN

I R A QDamascus

Baghdad

100km

Territorial control KeyOil fieldsIsis control Syrian regime Oil market

Mobile refineryIsis support Kurds Primary oil routes

Bought by IsisRebel-held Smuggling route

Syria oil map: the journey of a barrel of Isis oil http://ig.ft.com/sites/2015/isis-oil/

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1Where the oil is extracted

Isiss main oil producing region is in Syrias eastern Deir Ezzor province, where

production is somewhere between 34,000 to 40,000 barrels a day, according to

locals. The group also controls the Qayyara field near Mosul in northern Iraq that

produces about 8,000 barrels a day of heavier oil that is mostly used locally to

make asphalt.

It is di!icult to determine a definitive oil production figure for Isis-controlled

areas. But it is clear production levels have dropped in the Syrian fields since

they were taken over by the militants. Most oil fields in the area are aging and

despite the group's e!orts to recruit skilled workers, it does not have the

technology or equipment needed to maintain them. Even so, they continue to

SinjarTo Mosul

Raqqa

al-Tabqa

al-Jabseh

To Aleppo

Deiro Fieldal-Kharata Deir Ezzor

I R A Qal-Omar

al-Shoula al-Taim

S Y R I Aal-Tanak

DEIR EZZORSYRIA

IRAQ

al-Qaim

50km


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provide Isis with its most lucrative income stream.

The price of the oil depends on its quality. Some fields charge about $25 a barrel.

Others, like al-Omar field, one of Syrias largest, charge $45 a barrel. Overall, Isis is

estimated to earn about $1.53m a day.

Oilfield Est. production (bpd) Price ($/barrel)

al-Tanak 15,000-17,000 $40

al-Omar 9,000-13,000 $45

al-Jabseh 2,500-3,000 $30

al-Tabqa 1500-1,800 $20

al-Kharata 1,000 $30

al-Shoula 650-800 $30

Deiro 600-1,000 $30

al-Taim 400-600 $40

al-Rashid 200-300 $25

2Selling crude oil

Though many believe that Isis relies on exports for its oil revenue, it profits from

its captive markets closer to home in the rebel-held territories of northern Syria

and in its self-proclaimed caliphate, which straddles the border between Syria

and Iraq.

The group sells most of its crude directly to independent traders at the oil fields.

In a highly organised system, Syrian and Iraqi buyers queue in their tankers at

the entrances to fields, often waiting for weeks.

3


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Oil refineries

Traders have several options after they pick up their cargo:

Take the oil to nearby refineries, unload it and return to queue at the fieldusually

done by traders under contract to refineries.

Sell their oil on to traders with smaller vehicles, who then send it to rebel-held

northern Syria, or east towards Iraq.

Try their luck selling to a refinery or sell it at a local oil market. The biggest are near

al-Qaim on the Syrian-Iraqi border.

Most traders prefer to sell the oil on immediately and return to queue at the

fields. They can expect to make a profit of at least SL3,000 (about $10) per

barrel.

TURKEY

Mosul

RaqqaAleppo

IdlibTabqa

IRAQ

S Y R I Aal-Qaim

TURKEY

Aleppo

Idlib

KhshamSaraqebJisr

ash-ShugurJORDAN

S Y R I AMayadeen al-Tayyaneh

IRAQS Y R I A

al-Bukamal

al-QaimMobile refineries

Recently bought by Isis100km


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The bulk of oil refineries are in Isis-controlled Syria. The few in rebel-held

territories have a reputation for lower quality output than the refineries in the

east.

The refineries produce petrol and mazout, a heavy form of diesel used in

generators a necessity as many areas have little or no electricity. Because the

quality of the petrol can be inconsistent and is more expensive, mazout is in

greater demand.

Refining is done by local residents who constructed their rudimentary refineries

after Isis's prefabricated "mobile" facilities were destroyed by coalition air strikes.

The owners make purchase agreements with the militants for their products.

There are also signs that in recent months Isis may have returned to refining. In

interviews with traders, the FT discovered the group had recently bought five

refineries.

Raqqa

Tabqa

S Y R I Aal-Tayyaneh

Mayadeen

al-Bukamal

SYRIA

IRAQ

I R A Q40km

At Isis refineries, the former owner stays

on as a "front" man. The group supplies

the oil; in return it takes all mazout

production and splits the profits on

petrol production with the original

owner.

Traders say Isis has its own tankers that

supply crude to its refineries from oil

fields regularly. The group also appears

to retain many of its earlier contracts

with una!iliated gas stations and other

refineries.


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4

Fuel to market

Once the oil is refined, it is bought by traders or taken by dealers to markets

across Syria and Iraq. At this point, Isis is almost completely disengaged from the

trade. About half the oil goes to Iraq, while the other half is consumed in Syria,

both in Isis territories and rebel-held areas in the north.

There are fuel markets throughout Isis-controlled areas and rebel-held Syria,

often located close to refineries. Most towns have a small fuel market where

locals buy and sell oil. But traders supplying these smaller markets often buy

their oil in bulk from larger hubs.

TURKEY

Manbijal-Bab

RaqqaAleppo

al-BirayhaTheban

al-QaimS Y R I ASYRIAIRAQ

40km

IR A Q

Isis markets

There are larger Isis-controlled markets

in towns like Manbij or al-Bab in Aleppos

eastern countryside. Traders here must

present a document proving they havepaid zakat, a tithe, to buy oil without tax.

Traders from rebel-held Syria who have

not paid the tithe, must pay a tax of

SL200 per barrel, or about $0.67.

Some privately-owned markets also levy

taxes. Al-Qaim market, one of the largest

in the region, charges buyers and sellers

about SL100 ($0.30) per barrel of crude

purchased.

Mosul

In Isis-controlled Iraqi cities like Mosul,

TURKEYMosulKURDISTAN

REGIONALGOVERNMENT

Sinjar

S Y R I A I R A Qal-QaimBaghdadANBARJORDAN 100km


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5

Fuel smuggling

With Isis only concerned with making its profits at the pump, smuggling fuel

the fuel is sold at mini petrol stations

with two pumps. They are ubiquitous on

Mosul street corners and locals usually

name the oil according to the part of

Syria it came from. This helps buyers

determine the quality of the oil and

compare prices.

Elbeyli/Al-Rai

TURKEY

Besaslan Sarmada Aleppo

HacipasaKafr Halab

Maarat al-NaasanIdlib

Kharbet

al-Jawz

S Y R I A

20km

Rebel markets

Two types of fuel are sold in rebel-held

Syria: pricier fuel refined in Isis areas, and

cheaper locally refined fuel. Residents

typically buy a mix of both, and use the

cheaper variety for generators and keep

better quality variety for their vehicles.

The importance of Isis oil to those living

in rebel-held areas of Syria is one reason

why the US-led coalition has been

reluctant to target the group's trade

routes. The coalition says it is wary of

alienating local populations by bombing

fuel now critical for their daily lives.


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into neighbouring countries can be good business for entrepreneurial Syrians

and Iraqis. Syrian smugglers say it has been declining in recent months, not

because of tighter border controls but because the sharp fall in international oil

prices make it unprofitable. But some determined smugglers continue their

trade.

Most of the smuggling from the Syrian side has gone through opposition areas

in the northwest. Locals buy fuel at the market, pour it into jerry cans and carry it

over the border on foot or, in mountainous areas, by donkey or on horseback.

In Iraq, the bulk of smuggling through the northern Kurdistan region has been

blocked, so locals say the route now goes south through Anbar province towardsJordan.

20km

Al-Rai

TURKEY

S Y R I AOrontes River

Sarmada Aleppo

Besaslan

Hacipasa

IdlibKharbet al-Jawz

25 litre jerry canWeight when full: approx 22.5kg

Equivalent to 15, 1.5kg bags of flour


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Boat

When oil prices were high, smugglers loaded larger jerry cans (50-60

litres) of oil into metal tubs or small row boats and, using ropes attached

to each river bank, pulled their cargo across the river and into Turkey. On the

other bank, tractors picked up the supply and took it to a local informal market,

where it was picked up by large trucks, which sold it on.

Pumps

Some Syrian and Turkish border towns have co-operated by burying

small rubber tubes under the border, such as at Besaslan. In recent

months, Turkey has stepped up border patrols and are constantly digging out

the makeshift pipelines.

On foot

A popular crossing point for smugglers carrying jerry cans of fuel on their

backs has been from Kharbet al-Jawz in rebel-held Syria to Guvecci in

Turkey. This has been largely shut down by Turkish forces, but the remote

terrain makes it impossible to stop.

Horseback

In places like al-Sarmada and al-Rai, smugglers have crossed the border

by mule, donkey or horses that can carry four to eight jerry cans at a

time.

Why is the Isis oil trade so di!icult to disrupt?

Find out


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More coverage

How oil fuels the jihadi

terrorists

The organisation runs a

sprawling oil operation

forcing even its enemies to

do business with it

Syrias mafia-style gas

deals with jihadis

The need for energy drives

Assad regime into a deadly

game where state-run

company sta!are pawns

Syria explainer: Allies and

enemies

Making sense of the

relationships beteween all

the di!erent actors

Sources: Institute for the Study of War; FT research

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syria oil map: the journey of a barrel of isis oil

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