The word is on the street is that the so-called “Islamic State” (ISIS) has encountered serious financial challenges lately for the first time since the beginning of anti-terrorist operations in Syria and Iraq. The terrorist organization has been pushed into a corned due to continuous airstrikes aimed at destroying ISIS-held oil infrastructure. Oil production across ISIS-occupied territories has dropped by one third, while total oil revenues of ISIS were cut in half due to falling oil prices and the abrupt decrease in the capability to produce and sell oil products such as gasoline. In addition, this terrorist group has lost direct access to the black markets in Syria and southern Turkey.
On March 25, American media sources announced that Abd al-Rahman Mustafa al-Qaduli, also known as Haji Imam, was killed during a counter-terrorism operation. He was considered the second most influential commander of ISIS and was responsible for the funding of this terrorist groups along with economic policies that were imposed upon ISIS-occupied territories. After this announcement, the the deputy head of the US Treasury Daniel Glaser announced that for the first time one could be optimistic about the prospects of fighting and defeating ISIS.
Due to the fact that over the past few months ISIS has lost the control over 40% of previously occupied territories, the terrorists have virtually lost the capability to collect taxes. Unlike Al-Qaeda which has always received the majority of its funds from foreign sponsors, the chance to cash in on civilians was crucial for ISIS.
However, it should be noted that ISIS has already proven it’s ability to recover from even the most serious blows. Its leaders are capable of quickly finding ways to overcome various obstacles, that is why experts agree that it would be premature to claim that the United States at any point succeeded in inflicting serious and permanent damage on the financial infrastructure of this terrorist organization. One should not forget that the terrorists still hold 60% of Syria’s oil wells along with 5% of Iraq’s. The Islamic State has been enjoying impressive economic independence so far, largely due to the fact that they were able to capture huge money reserves after occupying a number of major Iraqi cities in 2014 (according to some estimates, they stole more than 700 million dollars). At that point, ISIS was the richest terrorist organization on Earth. Today is has already spent a portion of this money, while the remaining sum was destroyed due to the carefully planned airstrikes.
These financial problems have forced ISIS to cut salaries to its militants in half in both Iraq and Syria, while an ever growing number of deserters say that in some areas militants saw their salaries delayed for months. Therefore, civilians and business owners that are forced to live within occupied ISIS territory complain that they are forced to pay excessively high taxes and put up with the confiscation of their property. Such steps are aimed at compensating for “lost profits”.
The stories deserters tell and the posts they make across social networks lead to the deterioration of the public image of the so-called Islamic State. Oppressed civilians and foreign mercenaries alike are leaving the territories occupied by the self-proclaimed caliphate, scared by the lack of even the most basic goods and the bitter fines that have been imposed upon them for any minor case of disobedience, like violations of the dress code, the smoking ban or attempts to avoid praying sessions.
The rapidly shrinking incomes are pushing local warlords to accuse each other of corruption, theft, and mismanagement. This, in turn, undermines the morale terrorists show on the battlefield. After suffering a long streak of serious defeats both in Iraq and Syria, ISIS has declared an emergency mobilization, which shows the widespread confusion within this terrorist organization. This means that one well-coordinated push may bring this inhuman army of mercenaries and fanatics to an end.
Vladimir Odintsov, expert politologist, exclusively for the online magazine “New Eastern Outlook.