So while Islamic State probably maintains some refining capacity, the majority of the oil in IS territory is refined by locals who operate thousands of rudimentary, roadside furnaces that dot the Syrian desert. Pentagon officials also acknowledge that for more than a year they avoided striking tanker trucks to limit civilian casualties. “None of these guys are ISIS. We don’t feel right vaporizing them, so we have been watching ISIS oil flowing around for a year,” says Knights. That changed on Nov. 16, 2015 when four U.S. attack planes and two gunships destroyed 116 oil trucks. A Pentagon spokesman says the U.S. first dropped leaflets warning drivers to scatter.
Beyond oil, the caliphate is believed by U.S. officials to have assets including $500 million to $1 billion that it seized from Iraqi bank branches last year, untold “hundreds of millions” of dollars that U.S. officials say are extorted and taxed out of populations under the group’s control, and tens of millions of dollars more earned from looted antiquities and ransoms paid to free kidnap victims….
Arguably the least appreciated resource for Islamic State is its fertile farms. Before even starting the engine of a single tractor, the group is believed to have grabbed as much as $200 million in wheat from Iraqi silos alone. paid on black markets. And how do you conduct airstrikes on farm fields? For his part, Bahney contends that the group’s real financial strength is its fanatical spending discipline. Rand estimates the biggest and most important drain on Islamic State’s budget is the salary line for up to 100,000 fighters. But the oil revenue alone could likely pay those salaries almost two times over, Bahney says.
Excerpts from Cam Simpson, Why U.S. Efforts to Cut Off Islamic State’s Funds Have Failed: It’s more than just oil, WSJ, Nov. 19, 2015