A replay of an expert call we hosted back on June 6th with Professor Charles Hill is included in the link below. His bio and an outline of key takeaways are also included. Professor Hill’s summary of the evolution and potential threats of ISIL’s growing strength out of the Arab Spring in 2011 is a good primer for understanding the longer term dynamic behind ISIL’s advancement into Western Iraq. This topic starts 13 minutes into the hour-long call:
The EIA estimates that about 75% of the reserves of OPEC’s second largest oil-producing country are contained its southern region. Iraq's other major oil fields with proven reserves (“major” defined as >5Bn barrels or more in proven reserves) is held in regions that ISIL has not yet penetrated. They are currently gaining on two large fields:
1. Southeast of Baghdad
2. Northeast Kurdish Region:
- By far the largest oil field in Iraq stretching from Kirkuk to Irbil. Neither has been breached thus far
Despite the threat, Iraq’s export capacity remains unabated:
- Currently shipping approximately 3.2-3.5MM barrels/day into the Persian Gulf (ALL out of Basra and its surrounding regions in the south)
- ISIL Militants were successful in seizing the Kirkuk-Ceyhan pipeline in June, but the pipeline was under serious repair and had not been operating since March 2nd.
- From solely a resource capacity standpoint, the IEA estimates that Iraq has the ability to increase its export capacity to 45% of OPEC’s total within the next several years
- Even without the Kirkuk pipeline, Iraq has the capacity to ship far more than its current OPEC production limit
Nevertheless ISIL took control of Mosul and halted the repairing of the pipeline which is capable of exporting 310K barrels/day into the Mediterranean….
What does ISIL control at this point?
- Major Cities of Mosul, Fallujah, and possibly now Samara (Just North of Baghdad up the Tigris River)
- Most of North and Western Iraq: The Iraqi/Syrian border has essentially been wiped out. ISIL has not yet penetrated the Northeast Kurdish controlled region which is likely no coincidence
- Baghdad is more or less surrounded
Over the last week, the threat has escalated on three fronts:
1. Capturing of the Mosul Dam:
- ISIL militants captured the Mosul Dam last week north of the city and are fighting to capture the Samarra Dam along with the city itself. Fighting in Samarra has prevented military support to the Kurds in the Northeast. Both Dams sit on the Tigris River which flows from the Mediterranean through Baghdad, and down into the Persian Gulf. They may have the ability to inflict to deliberate and inadvertent flood damage with control of the dam.
2. ISIL move on Irbil:
- Northeastern city in Iraq’s Kurdish controlled region that sits on the Northern tip of Iraq’s largest oil field.
3. Pursuit and genocide of ancient Yazidi Tribe trapped in Mt. Sinjar:
- ISIL has stated the goal of systematically destroying the Yazidi cult. ISIL spokemen have said Yazidi tribe has the choice of converting to Islam or being killed.
These recent developments triggered the response from Washington late last week. President Obama announced airstrikes at Mt. Sinjar and military supplies for Kurdish troops. At Mt. Sinjar, the U.S., France, and U.K. dropped food and water (enough for 8,000 people according to the Defense Department).
As part of ISIL’s pillage, they have reportedly captured U.S.-supplied weaponry and vehicles from Pesh Merga Forces defending the border into Iraq's Kurdish region.
The shift in military firepower may have been a key inflection point for U.S. involvement. Without a clear path for reinforcements from Baghdad, Kurdish forces may be outgunned at the moment as they get ready to defend the two largest cities in Iraq’s Northeastern region. This shift was not considered a real threat back in June when ISIL took the city of Mosul.
A quick look at the map below would explain the significance of the Mosul Dam and the advance on the city of Irbil. Notice that not a single of Iraq’s major oilfields has yet been threatened until now. The ISIL build-up just southwest of Baghdad is increasingly threatening with the distraction of the Iraqi elections.
In his speech last Thursday night Obama threatened airstrikes to protect military personnel and the U.S. consulate IF ISIL were to advance on Irbil. Washington emphasized that the airstrikes will only provide temporary relief on hindering the ISIL advance. A unified coalition coming out of the elections was labeled the key catalyst in uniting the country.
The Obama administration put its stamp of approval on newly elected Prime Minister Haider Al-Abadi. In a speech today Kerry urged Abadi to create a legitimate coalition within thirty days that would unite all sects, a seemingly impossible feat if history is any indication. In adherence to current law, Nuri Al-Maliki will remain caretaker and Prime Minister while Abadi attempts to create an effective coalition. Not surprisingly, Maliki has refused to step aside after an eight year reign. He publicly called the election results “legally insignificant.”
Maliki's disapproval stems from his failure to maintain any semblance of Sunni support. Many Sunni-based groups have now sided with the authoritarian pursuit from ISIL because of their growing disillusionment with the current regime. At this point even Shi’ite military leaders and commanders who have been some of Maliki’s most loyal followers have signed their approval for the political change. Abadi also appears to have the blessing of both Iran and Iraq’s powerful Shi’ite clergy, which have gained significant power since the U.S. helped overthrow Saddam Hussein in 2003.
Abadi said today that he would welcome all political groups to join and unite the government. In terms of granting aid to those affected by the ISIL's radical agenda, John Kerry said that the United States would request international support IF Abadi forms a government that can demonstrate an ability govern. Until this happens, Kerry reaffirmed Obama’s message that the U.S. would not send combat troops.
Abadi’s ability to implement 1) An effective coalition capable of protecting against ISIL’s crusade; and 2) support a Kurdish defense outside of Kirkuk and Irbil will be key catalysts to monitor over the coming weeks.
Please feel free to reach out to us with any additional color or areas of concern that we may be overlooking.