December 2, 2013: Oil exports are up in October, averaging 2.25 million barrels a day. That’s a big jump from 2.07 million barrels in September but way down from 2.69 million barrels in April. The fluctuation is largely due to the need to carry out much delayed maintenance and upgrades. From the 1980s, when Saddam invaded Iran, to 2007, it was not possible to do a lot of maintenance and upgrades. There was the war with Iran that lasted until 1988, followed by the invasion of Kuwait in 1990, followed by over a decade of sanctions, then in 2003 the Americans and British invaded. Several years of terrorist violence made work on the oil industry difficult. But for the last five years a lot of delayed work has been done. The government hopes to get production up to nine million barrels a day by 2017, but that is considered too ambitious by oil industry experts. Getting production over six million barrels a day is more likely. Although security in the oil facilities is pretty tight, there are still problems with attacks on some pipelines. Still, in October 69.8 million barrels were shipped, bringing in $7.16 billion dollars to the government.

Despite all that oil income, Iraq’s main problem remains corruption and the inability to find or keep in office honest and efficient leaders. This has had a negative impact on oil production. Iraq has 150,000 million barrels of oil in the ground. Since Saddam was deposed in 2003, production has risen from one million to a brief peak of three million barrels a day. The government gets most its revenue from oil income, which is currently over $80 billion a year (from the exported oil). Iraqis pay no income taxes because of this, but that makes the oil fields all the more important. While GDP is $130 billion, it would be a third of that without oil. Some 95 percent of the $80 billion annual government budget comes from oil profits. But the rampant and seemingly uncontrollable corruption means that little of that oil income goes to improving roads and other infrastructure, not to mention security and all the other things you need to expand oil production. Corrupt politicians steal much of the oil income and are not very trustworthy when it comes to making business arrangements with foreign firms needed to increase oil production. Despite all the oil wealth, a quarter of the 33 million Iraqis are still very poor and unemployment is over ten percent. Many Iraqis admit the corruption is the core problem, but no one has been able to get a critical mass of cooperation needed to get most of the corrupt practices out of government and business. There has been some progress in the oil industry, because oil is seen as key to any future reforms. But earning more oil income is still largely wasted because of the corruption.

The continuing war in Syria poses some major problems for Iraq. Like other neighbors of Syria, especially Turkey, Lebanon, and Jordan, Iraq is now bracing for the worst case, the defeat of the Syrian rebels. Actually this appears as a best case for Iraq because it would mean another major defeat for Sunni Islamic terrorists. But that would just drive a lot of these terrorists back into Iraq. For Turkey, Lebanon, and Jordan it would mean that the millions of pro-rebel refugees they are hosting would be joined by thousands of angry, defeated, and often still armed rebels. The Islamic terrorists among the rebels are of greatest concern because these men would be content to continue fighting in any country they land in. For the Islamic terrorist rebels from outside the region, it might be preferable to return to their home countries in the West and elsewhere and continue killing there. Most would continue operating against the Assad government, as would the more moderate rebel groups. The Syrian refugee camps would become bases for the expelled rebels and the world would have a new terrorism crises to deal with. In a familiar drill, Western donors would support the refugees, the host countries would complain about the economic and social disruption of the refugees, and Syria and its allies (especially Iran and Russia) would complain about the rebels and Islamic terrorists living off the refugee camps and continuing to terrorize the Assad supporters in Syria. Only Israel would escape this mess, because the Arab world has been at war with Israel since the late 1940s and Israel has been able to cope with the Islamic terrorism. While Iraq would find itself with more Islamic terrorists in Anbar province (largely Sunni western Iraq), the autonomous northern Kurds would now be helping the newly autonomous Syrian Kurds of northeast Syria to maintain their independence from the Assad forces. This could get interesting. Otherwise, the worst case in Syria is not much different than the best case (rebel victory). The key issue is always about what is to be done with the Islamic terrorists.

December 1, 2013: In November 659 were killed by terrorism related violence in Iraq. That’s down 33 percent from October (when 979 people died, which was similar to the number who died in September). In October, 14 percent of the dead were soldiers and police while most of the other victims were innocent civilians. Terrorist related deaths for the year so far are over 8,000 and the government is under a lot of popular pressure to stop the mass murder. That pressure has led to some improvements in how the security forces operate, but the Iraqi government has appealed for international support and the U.S. has responded with intelligence support and some experts on the ground. Because Iraq refused to provide American troops with protection from corrupt Iraqi police and courts, there was no Status of Forces agreement and the only Americans available in Iraq are the few who can use diplomatic immunity. Iraq may yet come across with the immunity but it is under great pressure from Iran to not do so.

Terrorist deaths are still much lower than they were during the peak years of the post 2003 violence but have doubled since 2011. Back then terrorist deaths went from 29,000 in 2006 to 10,000 in 2007, and kept falling until 2011 (when there were 4,100 deaths). Then came the Arab Spring and the Sunni uprising against the Shia minority government in Syria. This energized Sunni radicals and led to a big jump in Sunni terrorism in both Syria and Iraq. At the rate things are going this year, 2013 will have twice as many terrorist deaths as 2011. So far the terrorists have managed to find ways to work around each new security measure and the Sunni minority still refuses to turn on the terrorists (as they did in 2007). The additional security measures have forced the terrorists to rely more on car bombs and remotely detonated ones at that because the terrorists are apparently running out of suicide bombers. There are also more kidnappings and executions of the captives (rather than asking for ransom). A growing number of these kidnappings appear to be by Shia death squads.

The Sunni terrorists (mostly the local al Qaeda and Sunni nationalists who are not eager to have the religious dictatorship that al Qaeda wants) continue to strive for a civil war between Shia and Sunni. This would be disastrous for the greatly outnumbered (4-1) Sunnis but most Sunnis are still bitter over the loss of power and income that came with the 2003 fall of Saddam Hussein. The 2007 peace deal, arranged by the United States, brought with it a sharp drop in terrorism and a halt to the Shia death squads that were randomly killing Sunnis. But after the Americans left in 2010, the Shia dominated government reneged on the terms of that deal, mainly by not supplying the promised jobs and share of the oil income. Sunnis also accused the Shia government of not supporting them in the north where Kurds were trying to reclaim property Saddam had stolen in the 1980s and given to poor Sunnis from the south. Then came accusations that some Sunni politicians (including several senior elected officials) were supporting Sunni terrorists. Some of these accusations appear to be true, but for most Sunnis it was the last straw and the Sunni terrorists found themselves with more fans and recruits. While many Sunni leaders oppose the terrorism, speaking out can get you killed by Sunnis who consider any peace proposals treason against the Sunni community. Now the Sunni uprising in Syria has further encouraged the Sunni terrorists, despite the lack of any real progress in Iraq and the growing risk of a devastating Shia backlash.

Another reason for the increase in Sunni Islamic terrorism is a change in tactics. Al Qaeda leadership has been responsive to what works and what doesn’t, even if many of their subordinates are content to keep making the same mistakes over and over again. Thus for the last decade the senior leadership has been pushing (with mixed success) the idea of using violence infrequently but with more precision and concentrate on addressing the needs of the people. Al Qaeda still wants to conquer the world but has noticed that creating a religious dictatorship too soon does not work. The support of most of the people is more important, and that’s a concept that young recruits have a hard time appreciating. But after the defeats in Afghanistan, Iraq, and Mali even the young guys are coming to accept that the road to victory is not littered with the bodies of innocent Moslem women and children. These things take time if you want to make a lasting impression. So the Sunni terrorists in Iraq are concentrating more on targeted attacks against political and military leaders, as well as the security forces in general. But the security forces and leaders are able to defend themselves and have become more ruthless in dealing with Sunni terrorism. Thus the growing use of execution for convicted terrorists and looking the other way as Shia death squads go back to work.

November 24, 2013: Another 11 convicted terrorists were executed. That makes 162 executed so far this year, compared to 129 for all of 2012. These executions are becoming more common in part because the Islamic terrorists have been more successful at using jail breaks or bribery (and intimidation) to get convicted terrorist killers out of jail.

Iraq responded enthusiastically to the news of the recent Iranian agreement over the Iranian nuclear weapons program (and the severe sanctions). Iraq does not want a more unstable neighbor to the east. Even without that, Iraq has growing problems with Iran. Despite its own cash flow problems at home Iran continues to supply crucial support for the Assad government in Syria, and those efforts are succeeding. Iran expects Iraq to, at the very least, not get in the way. Iran has not put a lot of Iranians into Syria but there is a constant supply of cash (in the form of dollars and euros), very effective military, security and other advisors, and some equipment and weapons. The cash and personnel tend to arrive by air on several night flights a week from Iran. These flights cross Iraq, which tries to pretend they don’t exist, but American radars can spot these flights. American complaints to Iraq about this continue to have no effect, but the U.S. is apparently making anti-terrorism assistance contingent on some cooperation against Iran. Despite that, there is still a lot of trade between Iran and Iraq and some of the trucks from Iran continue all the way to Syria. This is a dangerous route because western Iraq (Anbar province) is largely Sunni and full of Islamic terrorists. The government has over 30,000 police and soldiers in Anbar and thousands of men in pro-government militias. This is keeping al Qaeda from taking over Anbar but the violence there is increasing. Many local Sunnis are supporting the government, if only to reduce the violence and economic disruption. Iraq wants Iran to defeat the Sunni rebels in Syria and wants it done sooner rather than later. Iraq can be expected to help Iran anyway it can in the coming six months as the final details of the nuclear weapons deal are negotiated (or not, as success is not certain).

November 23, 2013: In the eastern Libyan town of Derna a visiting Iraqi professor was kidnapped and later a video appeared on the Internet announcing his death because he was Shia. Sunni Islamic terrorists in Derna have been increasingly violent lately and Libya has told Iraq that it is seeking the murderers.

November 22, 2013: Despite being Friday (when Moslems go to mosques for weekly services) most Sunni mosques closed today to avoid the growing number of terror attacks against Sunni mosques. The Shia terror groups are returning, which was not unexpected, considering the growing Sunni terrorism of the last two years.

November 21, 2013: In Syria ISIL (Islamic State in Iraq and the Levant), an Islamic terrorist group formed last July by the Iraq branch of al Qaeda, has called for all moderate and Islamic radical rebel groups to unite. All the rebels can agree on is that unity would be a great thing, but none can agree on who would be in charge. Currently the senior al Qaeda leadership is calling on ISIL to disband and stop feuding with Syrian Islamic terrorist groups. That isn’t happening and neither is rebel unity. Iraqi al Qaeda leaders see ISIL as an opportunity to challenge the senior al Qaeda leadership (now dominated by Egyptians and other non-Iraqis).

November 20, 2013: The Iraqi al Mukhtar Army militia, a pro-Iran group, fired six mortar shells into Saudi Arabia, a few hundred meters from a major Saudi oil field. An al Mukhtar Army leader said this was a warning to Saudi Arabia, which is believed to be supporting Sunni Islamic terrorist groups in Syria and Lebanon. This particular warning comes two days after a Sunni terror group set off a bomb near the Iranian embassy in Lebanon. Iraq condemned this attack, if only to maintain good relations with its southern neighbor.

November 17, 2013: Another 12 convicted terrorists were executed.