Undergraduate Honors Theses

Thesis Defended

Spring 2019

Document Type


Type of Thesis

Departmental Honors


International Affairs

First Advisor

Dr. Murat Iyigun, Dept. of Economics

Second Advisor

Dr. Artemi Romanov, Germanic & Slavic Languages & Literatures and International Affairs

Third Advisor

Dr. Douglas Snyder, Dept. of International Affairs and History, Baker RAP


This paper analyzes the currently available information on Islamic State (ISIS) financing techniques. This paper investigates eight Islamic State financing techniques, four of which derive from natural resources and four that involve extralegal and criminal practices. The natural resource funding techniques analyzed include: the production and sale of oil, natural gas, phosphate and a variety of agricultural products. Additionally, the extralegal funding techniques analyzed include: extortion, kidnap for ransom, trafficking in antiquities and foreign donations. This paper examines three key trends and areas for further research that have not yet been identified in the field. First, this paper finds that as Islamic State loses territory, the organization increasingly moves into and relies on extralegal funding techniques. Second, this paper argues that Islamic State’s control of natural resources such as natural gas fields and phosphate mines, are more beneficial to the group as “resource denials” to the Assad regime and Iraqi government than they are as money makers for the group. Finally, it is argued that there is a link between Islamic State oil revenue and the world oil price, even though the terror organization is forced to sell its oil at discounted prices on the black market. At the time of writing, Islamic State controls less than 1% of the territory it did in 2014, and this paper predicts that it will move into harder-to-detect financing techniques such as donations as it attempts to rebuild the Caliphate.