17:02 GMT +301 October 2016
Live
    A member of the Syrian government forces stands next to a well at Jazel oil field, near the ancient city of Palmyra in the east of Homs province.

    How to Stop the Terrorist Oil Trade Once and For All

    © AFP 2016/ STR
    Middle East
    Get short URL
    92796200

    According to Russian energy investment analyst Eldar Kasaev, in addition to simply blowing up terrorist oil convoys or blocking their path across the Syrian-Turkish border, there are four crucial international legal mechanisms which, if adopted, would be able to halt the sale of stolen oil once and for all.

    In an analysis recently published in the independent Russian newspaper Svobodnaya Pressa, Kasaev, a consultant for the Expert Council of the Union of Russian Oil and Gas Producers, recalled that at present, Daesh, al-Nusra and other terrorist groups occupy significant oil fields in Syria and Iraq, profiting off the theft of these countries' resources and depriving them of resources critical to the well-being of their economies.

    The main market for the stolen oil, Kasaev notes, is Turkey, with evidence suggesting that some of the oil also makes its way to Jordan, from where it goes abroad, including to Europe and the United States.

    "It's important to note that the monthly volumes of oil which Turkey buys from the terrorists depends on brokers' ability to freely cross the Syrian-Turkish border, which is guarded by the enemies of Daesh. The going rate for the oil is [currently] only around $15 a barrel. The stolen oil goes abroad at market prices, which are twice the price that Turkish buyers pay the jihadists."

    In this situation, the analyst notes, "it should not surprise anyone that the stolen oil supplied by Daesh militants at extremely low prices attracted Turkey from the very beginning. Reselling it, Turkey has the opportunity to earn some extra income, while bombing the Kurds under the guise of combating radicals. Of course, they could also use the oil purchased from the terrorists on the domestic market, as the country's own oil output is very small, while consumption is high."

    Today, Kasaev writes, the political actors ostensibly searching for a solution to the Syrian crisis recognize the importance "of the creation and implementation of clear and effective international legal norms which could prevent the radicals from regularly receiving financial support via the illegal sale of oil."

    Unfortunately, at present, the issue of the illegal seizure, transport and sale of oil and gas resources to third countries from so-called 'failed states' faces "a double difficulty from the point of view of international law."

    "Firstly, the term 'failed state' remains controversial, and there is no coherent and generally recognized international legal doctrine in relation to such a state. Secondly, Daesh (the 'Islamic State'), despite its name, is not a state actor, but a terrorist organization, whose actions in the course of an armed conflict are not governed by the rules of international law."

    With regard to Daesh's operations in Syria, Kasaev recalls that in the strict legal sense, what is going simply amounts to "an illegal seizure of a part of the territory of a state whose oil and gas fields are owned by the state (Article 14 of the Constitution of the Syrian Arab Republic)."

    What's more, in contrast to Article 55 of the 1907 Hague Convention (IV) Respecting the Laws and Customs of War on Land and Its Annex, which notes that occupying states have the right to administer and use the resources of occupied territories, "in the case of Daesh, it is a matter of the annexation of a territory by a terrorist organization, which is not a subject of international law and which does not comply with the laws of war."

    Therefore, the analyst notes, "it can be concluded that Daesh controls, produces and exports the production of Syrian oil fields completely illegally. However, it is worth once again drawing attention to the fact that this issue is not specified within existing international legal doctrine."

    Four Mechanisms to Address Illegal Oil Smuggling

    In the present situation, Kasaev suggests, there are four concrete international legal mechanisms which could help to definitively address the illegal smuggling of oil resources.

    "First: It is no secret that Daesh concludes deals to sell oil and oil products from occupied territories in Syria with independent foreign traders (deals are done right near the wells themselves!). It is therefore necessary to approve of strict international legal rules which would prescribe punishment for both public and private sellers, commensurate with the scale of the offense."

    "The second issue," according to the analyst, "is connected to the amount of oil and oil products  supplied. For example, oil from Iraq to Turkey is sold under a bilateral treaty between the two countries. However, due to a strong element of corruption, which allows for contraband supplies to be exported to the Turkish market in addition to legal supplies, more oil finds its way to Turkey than the contract allows for. A similar scenario is now playing out in Syria."

    "It seems, therefore, that it would be appropriate to establish a specialized international agency, accountable to the United Nations (and not to regional organizations such as OPEC or OAPEC), given the strong risk for corruption at the regional level. The main goal of the organization would be to control the volumes of oil and oil products moving from Syria to foreign markets. Moreover, the agency could ensure that everything on the domestic market in Syria was there legally as well."

    "The oil, oil products and financial resources seized from the smuggling of hydrocarbons in the course of monitoring should accumulate in the accounts of the agency pending a UN decision on the fate of the fuel and the funds," Kasaev notes.

    "Third: payment for the deals struck between the jihadists and foreign buyers is carried out through the banking system. In the ranks of the terrorists there are professionals in the banking sector who are quite capable when it comes to carrying out currency operations. Moreover, Daesh has seized a large bank in Iraq's Mosul."

    "It would make sense," therefore, the analyst suggests, "to cut off the possibility for Daesh and its affiliated groups to carry out transactions through the international cross-border inter-bank payments system. The United States and Western countries, which are de facto fighting against the terrorists in Iraq, and on the Syrian track, are quite capable of finding a solution to this problem – that is, if they wanted to."

    "Fourth: Without exception, all international players are interested in the reliability of the long-term supply of energy supplies to different markets. The situation in Syria has long-since become not only a regional but a global problem, including for the transit of oil and gas."

    "Syria itself," the analyst recalls, "is not a significant exporter of hydrocarbons, but finds keen interest [from abroad] as a transit country. For example, Qatar is interested in seeing the establishment of a pipeline network which would allow Qatar to export energy to Turkey, and from there on to Europe. This would strengthen Qatar's position on Turkish and European markets and, as a consequence, would reduce the competitiveness of the Russian network for the provision of natural gas to these areas."

    "In this connection, in public dialogue with the United States and other players, it would be expedient for the Russian side to promote the adoption of international standards which would ensure the reliability and long-term sustainability of energy flow abroad," Kasaev concludes.

    Related:
    Turkey Covering Terrorists Retreating in Syria's Latakia - Military Source
    Russian Warplanes Destroy Over 1,300 Terrorist Targets in Syria in One Week
    No Pay, No Jihad: Salary Cuts Will Cause Desertion Among Daesh Fighters
    Dirty Oil Business: Turkey’s Government Has Been ‘Pushed Into a Corner’
    US Turns Blind Eye to Turkey’s Oil Business With Daesh
    Tags:
    Middle East, op-ed, analysis, oil trade, illegal oil trade, Daesh, Iraq, Turkey, Syria
    Community standardsDiscussion
    Comment via FacebookComment via Sputnik
    • Сomment

    All comments

    • support
      This article very well explains not only the best way forward but also why Qatar welcomes a Turkish naval base.

      From reading this and other articles, it is Queen Erdogan the Last's intent to establish the Lazyman (as opposed to Ottoman) Empire on a quadrilateral basis: Sarajevo to Mosul, Mosul to Qatar, Qatar to Ankara, then Ankara to Sarajevo to complete the quadrilateral with perhaps Kosovo as part of the "team" as well.

      If the above strategy goes forward the US/Daesh partnership will be destroyed forever. IMO only President Putin can make this strategy a reality.
    • karlof1
      Excellent analysis and suggestions to implement the UNSCs regarding the financing of terrorism and associated gangsters, like Barzani's Kurds.
    • dvdgrg09
      People can talk about legalities until they are blue in the face.
    • cast235
      Unfortunately, U.N is a west VASSAL. Kerry will appear at night at Ban's home to terrorize him.
      The BEST way to end the smuggling is to codify Syrian sanctioned trucks. Blow everything else that is not...
      SU35s is there. And SU 34. SU 34 have a nice cannon that armed could shot and burn all trucks. Su 35 S could escort. Turkey is real mad to the fact that Turkish militia is been blown ski high. But they terrorists. IF Russia destroy every truck going to grab oil, it will not be long before the GAME IS OVER.
    • Alabama Mothman
      Russia should just attack the oil wells themselves
    Show new comments (0)
    Top stories