Oil & ISIS

Last night, our President laid out a strategy to defeat ISIS (Islamic State of Iraq and Syria). This morning oil prices dropped to a multi-month low.

There has always been a correlation between our war in the Middle East and oil. Afghanistan occupies a strategic position between the Caspian region and the markets of Asia. The Caspian Sea area may have the largest oil reserves in the world. The problem has been getting it out. It’s virtually the only area in which oil companies could build pipelines. In 1996, Unocal and the US Government were excited about the Taliban’s rise to power, calling it a source of “stability” in the region.  These turned out to be pipe-dreams. Pun intended.

Now we have Kurdish oil in northern Iraq. Kirkuk, the epicenter of the northern oil region, was strategically captured last month by ISIS when the Iraqi Army fled their advance. 

This effects many economies, the closest being Turkey. Turkey definitely has a watchful eye on this as much of their oil comes from this region. Sayer Industries, the largest privately owned Turkish oil company, has wells in the area. They supply nearly 9% of Turkey’s internal demand.

Although this isn’t Sayer’s only drilling region, they are forced to look at new areas, such as the Ukraine,  in order to protect their investors.  Having funding pull out of Iraq could lead to greater destabilization of the region.

Another problem.  Iraq’s national resource ownership has gone unresolved for as long as we’ve occupied the area.

In a story from Jim Krane from Rice University, printed today, said that “The possibility that Iraq may be carved up in to autonomous ethnic enclaves is growing. If Baghdad is unwilling to demonstrate its commitment to power-sharing, Washington ought to outline one potential cost: and end to our opposition to Kurdish control over natural resources.”

Sixty miles from Galveston, the US government is not allowing a tanker into US territorial waters, leaving them in legal limbo. The reason: It’s Kurdish oil, and we publicly support Baghdad’s claim of control over Northern Iraq’s resources.

It was reported that the ship turned off their transponder and then turned it back on. This is a strategy used when there is a plan to unload into smaller tankers, making it a challenge to trace. This will put Kurdish oil into the open market.

Without territorial integrity of Iraq, and a decision not being made on Kurdish exports, we leave the power to ISIS who now controls the region. Hence, the oil.

Reducing Sunni alienation from Shia-dominated Iraqi government is the only way Obama’s plan can work against ISIS. In some areas, Sunnis believe it to be more tolerable to be occupied by ISIS than to be under the oppression of the Iraqi forces.

If we did not have unconditional support for Baghdad, making them more inclusive of other minorities, it would weaken ISIS’s stance in the region. Drastically.

Today is the 13^th anniversary of 9/11. While I am still saddened by the events that took place, I am also sickened that my son, the 5 year old boy who I tucked into bed September 11, 2001, is now serving in a military that is still fighting a war on terror. Why are we forced to confront this issue with military action when mere (force of) diplomacy would create a better outcome?