International Resource Politics 101: Terrorism and Geopolitics

Foreword

International Resource Politics is characterized by three terms: International Relations, Geopolitics, and Resources. It explains the influence of natural resources, particularly energy, on state behavior and international politics. Resources have a tremendous impact on the world stage as resource-rich states have power over obtaining, securing, and limiting access to their energy assets, hence shaping interstate relations. Taking into account the three terms formerly mentioned, this series of articles explains the geopolitical advantages and disadvantages provided, namely, by energy while focusing on the development of resources as economic engines and their role in various political events that occurred in the late 19th century up to present times.


The International Resource Politics 101 series is divided into six chapters:

  1. International Resource Politics 101: Foundations of Resource Politics

  2. International Resource Politics 101: Oil’s Emergence and Historical Implications

  3. International Resource Politics 101: Economic Illnesses

  4. International Resource Politics 101: Political Implications of Renewable Energies

  5. International Resource Politics 101: Terrorism and Geopolitics

  6. International Resource Politics 101: Blessing Or Curse?


International Resource Politics 101: Terrorism and Geopolitics


In Jiddah, a coastal city in Saudi Arabia, the Houthi, a terrorist group from Yemen, attacked a Saudi Aramco oil storage and transport complex on the 25th of March, 2022 (Deutsche Welle, 2022). The targeted attacks on oil tankers and oil installations in the Middle East became quite often that between January 1, 2016, and October 20, 2021, the Center for Strategic and International Studies (CSIS) examined 4,103 Houthi strikes against Saudi Arabia, Yemen, and other areas of the Gulf (Jones, et al., 2021). The strikes contributed to an enormous political and economic impact by disrupting the global oil supply and raising oil prices. In 2022, Egypt´s natural gas pipeline in the northern Sinai region has been attacked by Islamic State (IS) terrorist groups (Onyango, 2022). In one of the attacks done by ISIS, the companies in Egypt have been ordered to pay $1.8 billion to Israel’s state-owned electricity company as a result of undelivered gas due to pipeline damage (Al-Monitor staff, 2020). The IS not only dominates the oil-rich area in Iraq and Syria, but it has also frequently attacked Libya's and Egypt's oil and gas sectors (Tichy, 2019). These fewer number incidents presented above demonstrate how energy infrastructure or other resource-rich places are increasingly targeted by terrorists.


The topic of terror attacks on energy infrastructures around the world is widely spoken about and creates questions about the incentives that drive energy terrorism. Therefore, this article will analyze the motives of terrorist groups targeting the energy industry and the goals they are pursuing by their actions.

Figure 1. Unknown. Smoke and flames rise from a Saudia Aramco oil faculty in Saudi Arabia's city of Jeddah.

There is no universally agreed term for terrorism, so is the term energy terrorism. The difficulty of definition stems from the fact that the organizations, and government agencies on the purpose of fitting their unique position, objective, or prejudice choose to have different applications to this term (Kelkar, 2017). Considering one of the definitions distinguished by the Council of European Union:

"Terrorist acts" mean intentional acts which, given their nature or context, may seriously damage a country or international organization and which are defined as an offense under national law.

Hence, energy terrorism is an act of targeting and damaging the energy infrastructures known as oil tanks, gas pipelines, electric power delivery systems and as well as kidnapping and sabotaging energy workers. Dr. Chia-yi Lee (2022) emphasizes major four reasons why terrorists attack energy facilities.


First, it is an easy target. According to Dr. Chia-yi Lee, energy facilities attract terrorists for their great limited mobility and high concentration and remoteness. Oil reserves are positioned where oil is abundant underneath, thus gas and oil pipelines are constructed in a way that connects the oil fields. This makes the energy business immovable due to its high expenses caused by the disproportionate geographic distribution of its endowments.


Figure 2. Petroleum Exports

Second, it is a great way to harm a state´s energy security and destruct the foreign policy objectives of another nation. Industrialized states such as South Korea, Japan, China, and EU members are heavily reliant on fossil fuel imports (Nation Master, 2019). Their colossal manufacturing industries that facilitate economic growth are sustained with the help of petroleum imports and any disruption in energy supply may have significant ramifications not only for these countries but also for the global landscape. Since Saudi Arabia produces about 10 percent of the world’s oil supplies and caters to China, the U.S., and many other countries in the client list, the two strikes on Saudi's oil infrastructure happened in 2019 resulted in a 10% increase in oil prices (Watters et al., 2019). Indeed, the concentration risk and vulnerabilities of the oil market are highlighted by the fact that a single combined strike can disrupt not just 5% of the world's supply but also more than twice as much of its spare production capacity (Watters et al., 2019). Another example can be the attack on the Caltex and Esso corporate offices in Manila in 1971 by a terrorist organization identifying itself as the "People's Revolutionary Front" that resulted in one fatality and three injuries (The New York Times, 1971). The terrorists' note, which said, "this is the fury of the Filipino people against American imperialism," indicated the United States as their intended target.

Third, Dr. Chia-yi Lee states that the location of energy infrastructure spanning long distances is a desirable target for terrorists, as it not only is vulnerable to physical threats but also exposed to cyber-attacks (Dancy, 2017, p.580). As a result of cyber attacks on gas pipelines, power plants, refineries, transmission grids, and even individual wells, terrorists may easily disrupt their operations. It may lead to a huge financial loss to victim countries, as well as the world, and explosions as a result of cyber threats create hazardous conditions for life in the region (Dancy, 2017, p.580). According to a poll conducted by security company Tripwire in November 2015, 82% of respondents from the oil and gas sector said their firms had seen an increase in cyberattacks over the preceding 12 months (Businesswire, 2016). Terrorist attacks are particularly likely to target the electricity network, which is highly interconnected and frequently subject to centralized control (Lee, 2022). Although some energy facilities, such as nuclear reactors, are well-protected energy installations, they may still be subject to attacks given how common it is to launch strikes from the air, via drones, for instance.



Figure 3. ISIS continues to stage attacks and intimidate the public in much of its former domain

Fourth, the terrorist groups also attack energy facilities to fundraise and sustain their violent activities around the world through illegal fossil fuels trade (Shapiro, et al., 2018). The Islamic State, also known as ISIS, was acknowledged by U.S. intelligence experts to be one of the wealthiest terrorist organizations in history before its fall in 2019 (Al-Khatteeb and Eline Gordts, 2014; Wilson Center, 2019). The militants' daily income was estimated up to $3 million, most of which comes from the illegal oil trade. Beginning in the middle of 2013, the Islamic State group, seized control of vast tracts of land in Syria and Iraq (Kreisman, 2017). They have been able to gain access to the major oil refineries. Hence, ISIS benefited mostly from using petroleum and its products or by earning revenue from sales of these resources to local customers (FATF, 2015).


Energy terrorism is a huge issue that resource-rich states encounter nowadays. Not only it harms the production of oil and gas, increases the prices in the world, and shakes the economies, but also it exacerbates geopolitical tensions. The ease of accessing energy facilities becomes favorable for the terrorists; thus, by damaging its refineries and pipes, it enables them to undermine states' economies and regulate foreign policy. Controlling energy stations also allows terrorist groups to make living through oil revenues. Lastly, the fact that energy control causes cyber attacks that could halt entire production and affect the world economy, strategic and economic impacts of energy terrorism are an important points of discussion.


Bibliography

Al-Monitor Staff (Iran). (2021, March 2). Islamic State claims sabotage attack on Egypt’s gas pipeline to Israel. Al-Monitor: Independent, Trusted Coverage of the Middle East. https://www.al-monitor.com/originals/2020/11/isis-attack-egypt-pipeline-israel.html.


Business Wire. (2016, April 7). Tripwire Study: Energy Sector Sees Dramatic Rise in Successful Cyber Attacks. Business Wire. https://www.businesswire.com/news/home/20160407005104/en/Tripwire-Study-Energy-Sector-Sees-Dramatic-Rise-in-Successful-Cyber-Attacks.


Chia-yi, L. (2022). Why do terrorists target the energy industry? A review of kidnapping, violence and attacks against energy infrastructure. Energy Research& Social Science. https://www.sciencedirect.com/science/article/pii/S2214629621005466#!.


Council of the European Union. (2015). The EU list of persons, groups and entities subject to specific measures to combat terrorism. https://www.government.se/4ad8f7/contentassets/29f8d11a200f413c89cb6ef398562cd6/eu-fact-sheet-on-terrorism.pdf.


Dancy, J. (2017). Terrorism and Oil & Gas Pipeline Infrastructure: Vulnerability and Potential Liability for Cybersecurity Attacks. http://2fwww.friendsoftheheadwaters.org/uploads/3/4/7/4/34740584/terrorism_and_oil___gas_pipeline_infrastructure__vulnerability_an.pdf.


Deutsche Welle. (2022, March 25). Saudi oil facility attacked by Yemen Houthi rebels. dw.com. https://www.dw.com/en/saudi-aramco-oil-facility-burns-after-attack-by-yemen-houthi-rebels/a-61266135.


FATF. (2015). FATF REPORT Financing of the Terrorist Organisation Islamic State in Iraq and the Levant (ISIL). https://www.fatf-gafi.org/media/fatf/documents/reports/Financing-of-the-terrorist-organisation-ISIL.pdf.


Gordts, L. A. A. E. (2016, July 28). How ISIS Uses Oil to Fund Terror. Brookings. https://www.brookings.edu/on-the-record/how-isis-uses-oil-to-fund-terror/


Kelkar, K. (2017, February 26). When it comes to defining ‘terrorism,’ there is no consensus. PBS NewsHour. https://www.pbs.org/newshour/nation/defining-terrorism-consensus.


Onyango, D. (2022, May 4). Section of Egypt’s Natural Gas Pipeline Attacked by ISIS Terrorists in the Northern Sinai. Pipeline Technology Journal. https://www.pipeline-journal.net/news/section-egypts-natural-gas-pipeline-attacked-isis-terrorists-northern-sinai.


The Iranian and Houthi War against Saudi Arabia. (n.d.). CSIS. Retrieved October 29, 2022, from https://www.csis.org/analysis/iranian-and-houthi-war-against-saudi-arabia.


Timeline: the Rise, Spread, and Fall of the Islamic State. (n.d.). Wilson Center. Retrieved October 29, 2022, from https://www.wilsoncenter.org/article/timeline-the-rise-spread-and-fall-the-islamic-state.


nytimes.com. (1971, January 23). Retrieved October 29, 2022, from https://www.nytimes.com/1971/01/23/archives/2-us-oil-concerns-in-manila-bombed-employe-is-killed.html?_r=0.


Top countries for Imports of Fossil Fuel. (2021, January 5). NationMaster. https://www.nationmaster.com/nmx/ranking/imports-of-fossil-fuel.


Watters, T et al., (n.d.). As Inventories Cushion Oil Price Impact, Abqaiq Strike Spotlights Risks To Spare Capacity. S&P Global. Retrieved October 29, 2022, from https://www.spglobal.com/en/research-insights/articles/as-inventories-cushion-oil-price-impact-abqaiq-strike-spotlights-risks-to-spare-capacity?utm_campaign=corporatepro.



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