With U. S. President Barack Obama’s announcement of an open-ended plan for airstrikes on the Islamic State (IS), the U. S. and its allies will need to degrade the power and influence of the Sunni jihadist group, and that means reducing its incoming flow of oil money.
And the Obama administration seems aware of that, according to a New York Times article that reports that the President and U. S. diplomats are pressuring Turkey to cut off the stream of oil smuggled across its border.
IS controls territory in central and northern Iraq, and is thought to be producing between 25,000 and 40,000 barrels per day (bpd). Since they cannot sell this oil legitimately, they smuggle it and sell it on the black market. Some energy analysts think IS could be pulling in between $1.2 and $2 million per day.
‘The key gateway through that black market is the southern corridor of Turkey,’ Luay al-Khatteeb, a fellow at the Brookings Institute’s Doha Center, told the Times. ‘Turkey is becoming part of this black economy.’
This post was published at Zero Hedge on 09/16/2014.