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The Oil War Between Kurds and the Islamic State
They both need the income to keep their societies going. They are both fighting for the control of the oil fields and wells inside Syria and Iraq. The Kurdish military has seized the northern section of Hasakah region in Syria. The towns of Al Qamishi and Ali Agha were also seized. This area was seized by some 30,000 fighters. Of course, ISIS, was unable to hold onto the area and lost oil revenue. ISIS also lost oil fields in Iraq. While oil is not their main source of income, it IS a considerable part of it. For the Kurds, it is their main source of income, generally, besides monetary loans from the USA.
The Kurds produce 40,000 barrels daily and most are sold to Arab middlemen for just $15 a barrel (the market rate is around $80 now). How does this create gasoline? Well, eight oil barrels make six barrels of gasoline or diesel. The oil sold to the middlemen with kilns refine the oil into fuel and then sell it for $40 a barrel. In the Kurdish controlled zone itself, there are 3,000 kilns owned by Arabs.
The Islamic State sells its oil for around the same amounts, but unlike the Kurds, pay armed men to defend the oilfields $512 a month. This allows their better trained troops to be used in more serious offensive operations but does drain their profit margins. Yet, ISIS is fighting and using scare tactics that are eroding the Kurds oil region in Syria. Originally, the Free Syrian Army had seized the oil fields in 2012, and then ISIS took them in 2013 and many of the FSA chose join ISIS. But the 30,000 Kurds was just too much for the ISIS. Now, ISIS captures oil trucks from the region, behead the drivers, and take the cargo. So, fewer and fewer oil trucks are leaving the region. They have also returned to more productive oil fields being defended by the Kurdish defense forces.
A new oil war is looming because they both need it.