Big Business, Black Markets, Bribery: Oil Smugglers in Kirkuk

By Shalaw Mohammed.

This article was originally published by Niqash. Any opinions expressed are those of the author, and do not necessarily reflect the views of Iraq Business News.

Oil smuggling is virtually a tradition in the oil-producing areas of Iraq. And local authorities are trying to prevent it. But, as this tale of oil smuggling in Kirkuk shows, policing the smuggling gangs remains extremely difficult – not to mention confusing.

The epic tale of an oil smuggling gang in Kirkuk is nearly two years old now. The gang was making an estimated US$60,000 a day from their activities. And they were caught in the act over 24 months ago – yet they are, allegedly, all still free. As one member of the security forces says: “no one can arrest them”.

The story is not an uncommon one in Iraq, where oil smuggling has a long history and where authorities appear loathe to take responsibility for policing this particular crime. Most tales of oil smugglers see various authorities – from the judiciary to the police to the state to the local oil companies themselves – saying it’s the other group’s responsibility to secure the oil.

Oil smuggling became a growth industry when former Iraqi leader Saddam Hussein organized gangs to start smuggling oil to get around international sanctions against Iraq. Tankers would siphon oil from various sources and either sell them on the home market or on the black market in nearby nations; demand was there for oil to run home generators, for example, needed because of electricity cuts. And despite the best efforts to halt the practice, it has continued in various forms to this day.

An anonymous source tells NIQASH that this particular instance of oil smuggling began when Iraq’s own North Oil Company decided to build a pipeline from the Jabal Bur oil processing station to a nearby area, Kiwan, where the pipe could then connect to a larger network.

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