The Islamic State of Iraq and Syria (ISIS) group’s takeover of key Iraqi cities is causing acute humanitarian concern and producing uncertainty in the international oil market.
The trade and development minister, Mogens Jensen, described the scale of the situation. “The militant Islamists’ brutal actions are extremely frightening and unseen in Iraq in the past 25 years,” he said.
“We must react quickly to the need for emergency aid. In a very short period of time, a million people have taken flight in their own country,” he continued in a press release published today.
“I have therefore decided to provide 20 million kroner in an extraordinary grant, so the UN can quickly establish relief centres and camps for the displaced and administer acute food aid to families in need.”
Oil market responds
Meanwhile Børsen business newspaper reports that escalating security concerns in Iraq threatens to impact on oil production, potentially pushing up prices.
One of the occupied cities, Kirkurk, lies on an important pipeline running to the Mediterranean Sea, and this is particularly causing analysts to question the security of oil production from the country, which is the second biggest producer of the Organization of the Petroleum Exporting Countries (OPEC).
Richard Mallinson, an analyst at the London-based Energy Aspects consultancy, told the Financial Times that the integrity of the pipeline was of great significance. “The continued disruption of the Kirkuk-Ceyhan pipeline and the wider effects will moderate Iraqi output growth in 2014 and potentially in future years as well,” he said.
Børsen writes that the price of Brent crude cost $110.27 per barrel this morning compared to $108.83 at the beginning of the month.