IRBIL, Iraq — Skirmishes for control of Iraqs largest oil refinery set part of the facility ablaze Wednesday as Islamic militants battled Iraqi security forces for control of more than half of the countrys ability to make gasoline.
Iraqi state television reported that security forces remained in control of the oil refinery and electric generation plants in Baiji, just north of the rebel held city of Tikrit. But witnesses contacted by independent Iraqi media outlets reported that fighters from the Islamic State of Iraq and Syria and their Sunni tribal allies had taken over at least portions of the facility and sent the workers trapped inside home.
Black plumes of smoke could be seen from at least a dozen burning storage tanks on local television stations as much of Iraq went into a panic of the possibility of a sustained gasoline shortage in a country already forced to import more than 100,000 barrels of day of gasoline because of high demand and crumbling infrastructure.
In addition to Tuesdays announcement that the Iraqi government had closed the oil supply to the facility either to stop the output from falling into ISIS hands or to prevent the facility from exploding amid the fighting the German firm Siemens and the security company Olive both said they had cleared out dozens of foreign workers and security guards from the complex, which has been surrounded by militant rebels since much of northern Iraq fell in last weeks surprise takeover. The Iraqi government however denied that foreign workers had left.
Government helicopters reportedly struck either the facility itself or rebel positions close by and according to some witnesses talking to local media, caused the fires.
One executive with a western oil services company working in Irbil, which remains quiet and under the control of the semi autonomous Kurdistan Regional Government, who does business with the Iraqi government and asked not to be identified, said control of the facility appeared to be split between militants and an Iraqi army unit that had been recently sneaked into the area to reinforce the beleaguered security guards normally assigned to protect it.
We dont exactly know because Baghdad has lost all credibility with the oil industry this week, he said. They keep announcing things they wish were true instead of giving us the information we need to make proper decisions.
This does not inspire confidence in their competence or their handle on events on the ground, he added.
Little in the performance of the Iraqi government has inspired much confidence of late as tens of thousands of soldiers and police deserted their posts and fled the battlefield last week as ISIS, which had previously controlled large chunks of eastern Syria and the western Iraq province of Anbar, suddenly materialized in force on June 9 and within 24 hours had overrun the northern city of Mosul, Iraqs second largest, capturing huge amounts of military hardware and perhaps hundreds of millions of dollars from Mosul banks.
Within days, the groups militants had reached the northern most edges of Baghdads suburbs, backed by what appears to be a broad Sunni Muslim rebellion against the Shiite dominated government of Prime Minister Nouri al Malaki, who has been widely accused at home and abroad of fostering unrest with sectarian political policies.
In Irbil, despite a local gasoline refinery remaining online, the loss of the highway from Turkey through Mosul on top of the loss of the Baiji facility caused a mild panic in this otherwise peaceful city as motorists faced long lines and severe limits on gasoline purchases.
But the oil industry executive said an impending shortage was, at least so far, unlikely to be truly disruptive.
Its a lot longer trip now [avoiding Mosul] but the Turks want to make money and can send it by land, he said. This seems a combination of both prudent rationing and psychological panic as people realize the conflict isnt going away.