FIVE THINGS TO KNOW ABOUT ISIL’S FUNDING PROBLEM

1 OIL REVENUE DRYING UP

The bombing campaign has “significantly degraded” ISIL’s capacity to process oil at the network of refineries it controls in Iraq and Syria. That has squeezed the group’s finances to the point where it is cutting fighters’ pay, according to a report by IHS, a global intelligence firm.

2 $108 MILLION A MONTH

According to IHS, the terror group rakes in a monthly profit estimated at $108 million, around half of which comes from taxation and confiscation, with most of the rest from oil. ISIL makes most of its money through the establishment of a violent and predatory bureaucracy that imposes a 20 per cent tax on all commercial activities, confiscates land and properties, and runs a sideline in the smuggling of goods, including stolen antiquities.

3 PARANOIA GOES UP, PROPAGANDA DOWN

A selection of ISIL’s internal documents, published separately, suggests rising paranoia in the group, prompting crackdowns on dissent and smuggling. There has also been a decline in the quantity and quality of its propaganda videos and other material.

4 ELECTRICITY PRICES RISE

As the damage to ISIL’s oil network starts to bite, there are also indications the group is struggling to balance its budget, IHS said, with reports of price increases on electricity and other services, and the introduction of new agricultural taxes.

5 TAX REVENUES A TOUGH TARGET

Tax revenues are proving a tricky target for the U.S.-led coalition — stopping them will require the recapture of ISIL land. Analysts say this will only be achieved with a ground force drawn from the Sunni Arab communities that ISIL has sought to terrorize and co-opt.