The recent Paris attacks, downing of a Russian airliner over Egypt and spasms of wanton killings throughout the Middle East have established a new international military target: the Islamic State. Relentless airstrike campaigns and coalitions have increased in the past few weeks and seem to be picking up the pace: in early November, a U.S. military official announced plans to ramp up airstrikes against the terrorist organization. Efforts to weaken the organization have also focused on another vital lifeline: their wallets.
It is hard to argue against the fact that the Islamic State is an exceptionally powerful, rich and resourceful terrorist organization. It has taken control of alarmingly large and strategically valuable territories and exerts control over a wide range of commercial and industrial activities such as oil and agricultural products. Some estimates assert that the value of the Islamic State’s assets currently exceeds $2 trillion, with an annual revenue of over $2.9 billion.
According to a study conducted by Thomson Reuters, almost 40 percent of this revenue comes from oil. The Islamic State has taken control of several oilfields in both Syria and Iraq, controlling more than 60 percent of Syria’s oil production capacity and less than 10 percent of Iraq’s. The study puts the Islamic State as the world’s richest terrorist organization, with unprecedented terrorist financing figures. For this reason, oil has become an essential source of revenue for the terrorist organization.
The United States has been targeting these oil installations since last year, and has recently revamped its attacks on Islamic State’s industrial base ― following the French airstrike campaign in Raqqa, Syria, the United States “striked more than 100 tanker trucks used to transport oil that helps the militant group earn tens of millions of dollars each month.”
However, there is a downside to this approach. Airstrikes targeting oil installations can result in the crippling of an essential international industry. Taking down and destroying oil installations might prove to be damaging in the long run. Therefore, the United States has been careful in its attempts to stop these oil installations from functioning. According to Col. Steve Warren, the United States military does not want to “completely and utterly destroy these facilities to where they’re irreparable.”
In order to fully hinder the Islamic State’s funding and avoid obliterating such a vital industry in their respective regions, the United States and other countries fighting ISIS should also focus on targeting and dismantling the underground networks and money laundering streams that are used to move funds to and from the Islamic State and they should focus on targeting other sources of revenue.
Petty crime, kidnapping, extortion and taxes are all incredibly important sources of funding for the terrorist organization. In the Reuters report, the estimate of the total tax extortion system imposed in Islamic State-controlled areas is as high as $360 million a year. According to people living inside or recently escaped from ISIS-controlled territories, the group “exacts tolls and traffic tickets; rent for government buildings; utility bills for water and electricity; taxes on income, crops and cattle; and fines for smoking or wearing the wrong clothes.”
Ultimately, the Islamic State does generate significant revenue from within its territories and the people it rules. This means that in order for the Islamic State to truly disappear, it must be expelled from these territories. The only way to destroy its revenue base, it seems, is through military force.
I have to admit, this all truly unsettles me. I see an increasingly rich organization that is all too familiar with the measures the international financial regulatory community has put in place to cut off this funding. It is an organization that truly exploits money laundering networks ― some of which have been in place for decades ― to fund its activities.
Putting in place mechanisms that both allow and facilitate anti-money laundering teams and specialized suppliers to identify hidden middle-men and networks that provide funds to the Islamic State should prove effective in both the short run and the long run. But in the end, if we truly want this terrorist organization to disappear, it will have to be confronted with full military might.
Combating the Islamic State financially is not the ultimate solution, but it is definitely a vital factor that should be in play. Our military efforts should not be focused solely on destroying the Islamic State’s oil infrastructure, but should also include alternative efforts in draining their coffers. We all know that without the proper funding, the Islamic State would become more vulnerable to our military strategies.
Carlos Lopez is an Opinion columnist for The Cavalier Daily. He can be reached at c.lopez@cavalierdaily.com.
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