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How ISIS built its own multi-million dollar industry by attacking oilfields

In Iraq and Syria, the Islamic State finances much of its military from siphoning and selling oil, amounting to more than a million dollars a day, according to estimates. Erika Solomon, a reporter for the Financial Times, joins Hari Sreenivasan from Chicago to discuss.

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  • Hari Sreenivasan, Pbs Newshour Weekend Anchor:

    The militant group known as the Islamic State or ISIS controls huge amounts of territory in Iraq and Syria. And ISIS finances much of its military operations from siphoning and selling the greatest commodity in Iraq and Syria: oil. Some estimates put proceeds from the ISIS theft at $1.5 million a day.

    “Financial Times” reporter Erika Solomon has written about this, and she joins me now, from Chicago.

    So, Erika, how is it possible that they have this kind of an industry of oil in the middle of the war where different countries are attacking them?

  • Erika Solomon, Financial Times:

    Well, that’s the very interesting part because actually, attacking oil fields is quite difficult. You can’t just bomb an oil field. It could cause a natural disaster and it could potentially hurt that country’s future in terms of using its oil.

    So, the coalition can only really go o after refining processes or everything after the extraction. And ISIS has used that to its advantage. Basically, it’s taken over oil fields and has used employees who already were working at those fields to continue production.

    And the other thing is that Syria has been in a war for about five years so, people in this region, when the government lost control, had been doing this for quite some time. What ISIS did was just take over production that was already ongoing and improve it.

  • Hari Sreenivasan:

    OK. So, who do they sell this oil to?

  • Erika Solomon:

    ISIS sells this oil to everyone there. A lot of people think that the oil probably goes to, say, the Syrian regime or to Turkey. But we found most of the oil is being bought by the people that ISIS controls, or even their neighbors who are technically at war with them.

    The most striking examples would be areas to the northwest controlled by the Syrian opposition, which is at war with ISIS. They fight ISIS at the same time that they actually have to buy their fuel because they have no other option

  • Hari Sreenivasan:

    So, the hospitals are all powered by generators using oil from ISIS.

  • Erika Solomon:

    Yes, that’s the really shocking part. At some point, ISIS has blocked fuel moving to rebel areas to make this point. And a few months ago, what happened is we saw hospitals that didn’t have any fuel. They couldn’t power some of their operations rooms and people actually died because they didn’t have fuel.

  • Hari Sreenivasan:

    Why is this so difficult to stop? You said it’s hard to bomb oil fields for environmental repercussions. Why is it so difficult to stop this pipeline of oil getting for one place in Syria or Iraq to another?

  • Erika Solomon:

    There’s differences of opinion among the international coalition about how to handle this. In reporting the story, I went to places on the border between Syria and Iraq where Kurdish Peshmerga forces are fighting ISIS with support from coalition air forces.

    They would like to bomb routes where you can see trucks going by with oil, but their coalition partners, like the it’s Americans say we don’t want to do that. We don’t want to turn what are essentially civilian traders against us because what ISIS has done is allowed locals to buy their fuel.

    They don’t actually control the entire system. They only control the extraction and sell crude oil. Locals are the ones who refine it and sell it on and they’re benefiting from it because they don’t really have any other economic opportunities right now. And that’s why the coalition has really struggled to find an effective way to fight the oil industry in Syria

  • Hari Sreenivasan:

    All right. Erika Solomon, normally based in Beirut but joining us today from Chicago — thanks so much.

  • Erika Solomon:

    Thank you.

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