The Islamic state’s oil revenue has been cut down in half to about $250m per year as a result to air strikes, drop in oil price, and counter-smuggling efforts by neighboring countries, Reuters reported citing a senior US Treasury official.
Daniel Glaser, who is Assistant Secretary for Terrorist Financing at the US Treasury’s Office of Terrorism and Financial Intelligence, explained the difficulties that Islamic State has in transporting its oil across battle lines have contributed to halve its oil revenues. “The number that we had been giving previously until about early this year was $500m a year off of oil sales. I think they’re substantially less than that now. I think they probably make about half of what they previously made,” he told a think-tank event in Washington.
A US military official said in January that the air campaign had reduced Islamic State oil revenue by about 30%.
The group also earns about $360m per year from taxation in the areas it controls, Glaser said. Cutting its taxation revenues is challenging because it occurs internally within Islamic State territory, he said. One approach he is looking at is drying up liquidity, or the availability of cash, to Islamic State-held territory, he added according to RigZone.
A US-led coalition has targeted the ultra-hardline Sunni Islamist militant group with airstrikes since it seized control of parts of Iraq and Syria in 2014. The US military launched an intensified effort in October to go after its oil infrastructure in hopes of cutting funding to the group, which US officials call the wealthiest terrorist group of its kind.