Blood Oil

From Nigeria to Iraq, Colombia, Chechnya and the Straits of Malacca, a growing global trade in illicit petroleum — as much as 750,000 barrels a day, or one percent of the world oil production — is providing money and weapons for violent conflict.

A conflict consultant I spoke with estimated that the amount of oil that can be stolen in the Niger Delta in just half a day is enough to fund the hiring of 1000 trained militia members for a month and arm them with an arsenal of AK-47’s. The consultant, who asked not to be named because it would prevent him from continuing to work in Nigeria, said conflict oil has made the Niger Delta as dangerous a war zone as Chechnya is.

In Iraq, a similar calculus of oil for weapons is at work for both Sunni insurgents and Shia militias. In 2005, 60 million barrels of oil were unaccounted for, according to Iraq’s oil ministry. That year, fuel smuggling may have cost the government $2.5 to 4 billion. And a percentage of that money went straight to the government’s enemies – insurgents, militias and criminal gangs.

Bilal Wahab, an Iraqi Fulbright scholar at American University in Washington, told me that 1200 tanker trucks smuggling oil crossed a single border point in one 24-hour period. Then he did the math: “A single tanker can make $7450 in profit, after paying bribes. A good car bomb costs about $7000, and if you assume that 30 percent of a single day’s smuggling is going to the insurgents, then you have the capacity for 400 car bombs a day.” By his reckoning, the carnage in Iraq has hardly even begun. (See his paper at The Middle East Forum Web site.)

via Pipeline