Transportation of ISIS oil to Turkey and the widespread engagement of Turkish middlemen was already well-known as early as 2014, when ISIS gained control over the majority of Syrian oil extraction zones close to the Turkish border. However, more recently, the Turkish government has been directly accused of supporting ISIS in oil trade. After the shooting-down of a Russian jet by Turkey close the Syrian border, the Russian President Vladimir Putin claimed that Turkey is a key partner of ISIS helping the terrorist organisation in smuggling oil from the regions under its control through Turkish territory. Putin’s claims are very serious; including the direct involvement of the Turkish President’s family. Erdoğan’s son in law, Berat Albayrak, who recently became the Minister of Energy following the November 2015 elections, and his son Bilal Erdogan, who owns BMZ Group that deals with oil shipping and transportation, are at the centre of the Russian claims.
President Erdoğan has asserted that if these claims were substantiated with firm evidence, he would resign from his post. What constitutes firm evidence remains ambiguous however, but many international observers have confirmed that Turkey turns a blind eye to ISIS oil trade through Turkish ports and have even profited from the supply chain at times. International media sources and the main opposition parties, the CHP and the HDP, have widely repeated the allegations regarding Berat Albayrak and Bilal Erdoğan’s direct links to ISIS oil trade through their business connections. That said, a detailed investigation has not been carried out by Turkish analysts and media. This is probably due to widespread censorship and lack of free speech in Turkey, as well as the lack of reliable and transparent data. As usual, the pro-AKP media has quickly dismissed the Western commentators and the opposition MP Eren Erdem, who brought up these claims at the Turkish Grand Assembly. Erdem has even been accused of collaborating with Russia and Fettullah Gülen’s illegal parallel structures, which aim to overthrow the government, according to the AKP and pro-government media.
Is there any Truth behind the Turkey-ISIS Oil Trade Allegations?
Reactions from the US, Germany and other NATO allies to the Russian claims were reserved. According to the US, oil smuggling from Syria to Turkey occurred, but the amount was insignificant and since the beginning of coalition air operations, ISIS’ oil infrastructure has been largely been destroyed. Moreover, the US claimed that ISIS oil is mostly absorbed by the war economy in Syria and even the Assad forces have been buying oil from ISIS at times of shortage. White House spokesman Josh Earnest stated that “the irony of the Russians raising this concern [against Turkey] is that there’s plenty of evidence to indicate that the largest consumer of ISIL oil is actually Bashar Assad and his regime, a regime that only remains in place because it is being propped up by the Russians”. A similar claim was also raised by Recep Tayyip Erdoğan, accusing the Assad regime of purchasing oil from ISIS controlled areas.
Evidently, local markets absorb the ISIS-originated oil in Syria and Iraq, as reports from the region suggest. Especially near Aleppo and Mosul, there are ISIS-controlled refined oil markets for local consumption. According to the Financial Times, “there are larger Isis-controlled markets in towns like Manbij or al-Bab in Aleppo’s eastern countryside. Traders here must present a document proving they have paid zakat, a tithe, to buy oil without tax”. Similar ISIS-run markets are numerous in Mosul as well.
However, fuel smuggling across the border has been a profitable business, despite declining due to air strikes and stricter border checks by Turkish authorities. The extracted oil, after being treated in refineries, goes through Turkey’s porous border. Analysts agree that there is an illicit oil trade from ISIS-controlled zone to Turkey that occurs through middlemen who profit from ISIS oil, illegal pipelines and unregistered oil storage facilities in several Turkish cities. Still, it would be wrong to assume that it is only the large mafia networks involved in ISIS oil business. Oil smuggling has become an ordinary and attractive source of income for people living in the border regions. As documented by Fehmi Tastekin from the daily Radikal, locals buy fuel at the market and cross the border on foot or horseback through mountainous areas. Sometimes neighbouring towns on both sides of the Syria-Turkey border agree to transport oil through pipelines buried in gardens and fields.
Unsurprisingly, larger scale smuggling occurs through traders and middlemen. Oil extracted from ISIS-controlled areas near Mosul in Iraq and Deir Ezzor in Syria is sold to Syrian, Turkish and Kurdish traders below the market price. According to the Financial Times, buyers go to ISIS’ oil fields with trucks. These traders purchase crude oil directly from ISIS extraction sites at $25-30 per barrel, when its price at legal market is between $80-100. They sell it to refineries or middlemen at $60-100 per barrel making attractive profits for themselves. So far coalition forces, afraid of stirring local reactions, avoided hitting trucks carrying illegal oil. Some reports confirm that the ISIS oil is sometimes labelled as products of Kurdistan Regional Government in northern Iraq in order to evade border controls.
ISIS Oil Route: Where does it come from, where does it go?
Cracking down on illicit traders of ISIS oil is key to curtailing the major financial resource of the jihadi organisation. But more important than chasing small-scale middlemen or local people in the Syrian and Turkish border towns, is tracking down how the oil is transported, where it goes from the storing facilities in Turkey and who buys it in order to take measures against this dirty business. According to the Russian Defence Ministry, hundreds of tanker trucks load up with oil in ISIS-controlled zones in Iraq and Syria and head to Turkey from three main routes. The Western route starts from the Syrian city Raqqa which is the self-declared capital of ISIS in Syria. Recently, the city came under heavy bombing from Russia, including the use of chemical weapons such as white phosphorus: the use of which is forbidden by international law in densely populated areas. This route goes through Azaz before the oil crosses the border to enter Reyhanlı in Turkey. The second main route is between Deir Ezzor in Syria and Batman in Turkey. The third route follows a path from eastern Syria and western Iraq into the south-east of Turkey.
According to Russian intelligence, satellite images have captured hundreds of trucks freely passing the border with Turkey without being subject to inspection by Turkish authorities. Usually, crude oil from Iraq is rudimentarily refined in private refineries in order to obtain permission to enter Turkey since Turkey does not allow crude oil unless it is licenced by the Iraqi government and border officers accept huge amounts in bribes.
Once in Turkey, ISIS oil is more difficult to distinguish from oil imported from Iraqi Kurdistan or other countries. Research by George Kiourktsoglou and Alec D. Coutroubis from the University of Greenwich shows that ISIS oil find its way to Turkey and then to the global markets. In Turkey, Şanlurfa, Hakkari, Batman, Mardin, Siirt, Şırnak, Adıyaman Gaziantep, Osmaniye, Kahramarmaraş have become temporary storage hubs before the oil ends up in major shipping ports and mixes with the Middle Eastern, Central Asian and Russian oil and natural gas before being sent to Europe and other countries.
The ISIS originated oil ends up in Dörtyol, Mersin and especially Ceyhan port in Turkey. Oil normally accumulated in these Turkish ports legally arrives from northern Iraq and the Baku-Tbilisi-Erzurum pipeline. However, recent research shows that a considerable amount of ISIS-oil smuggled into Turkey ends up here, evidence provided through tracking the tanker charter rates and transport patterns. It is shipped to several countries such as the port of Ashdod in Israel and some EU countries, as the graph below shows. Usually, the oil is treated further in Israel before it is re-sold to Europe, mostly to refineries in Italy, at a much higher price per barrel.
The evidence is not enough to conclude that Turkey shot down the Russian jet to protect these oil routes, or that members of Erdoğan’s family directly benefit, as claimed by Russia. Nor is it enough to prove that the Turkish government collaborates with ISIS by buying crude oil or petrol directly from the jihadi organisation. According to some commentators, such as Fawaz Gerges, there is no evidence leading us to believe in conspiracy theories that there is “an unholy alliance with Turkey and the Islamic State”. Obviously, the oil route is not straightforward. There is a long supply chain from ISIS-controlled extraction sites to several Turkish cities and many people including organised mafia networks and local people living in border towns are involved in smuggling ISIS oil to Turkey.
Yet, there are several factors that still allow ISIS to continue reaping revenues from the oil business: the difficulty to control the 900 km border with Syria, the mobility of ISIS fighters and smugglers across the Turkish border, the AKP government’s insistence in supporting rebel groups such as the Free Syrian Army and al-Nusra as the line between these organisations and ISIS networks has become murky, and finally the avoidance of US-led coalition forces from targeting convoys carrying ISIS oil in order not to raise local discontent with coalition intervention.
Where does the current situation leave us then? Al-Qaida was not a self-reliant terrorist organisation. It had to count on international donors, whereas ISIS has created its own profitable, strategic and powerful weapon. In the near future, a key test for the coalition forces and Russia will be to target where ISIS draws its real strength: oil production and illicit trade, if they want a decisive strategy to undermine the most formidable jihadi organisation that we have ever faced. Given the complicated smuggling networks across the borders and the extensive market for ISIS oil, air strikes seem like only a small part of a long struggle.