A flyer protesting Assad's de facto alliance with ISIS Syrian revolutionaries A Syrian businessman described as the "middleman" for oil deals between ISIS and Bashar al-Assad's regime will be targeted for European Union sanctions on Saturday.

The listing of George Haswani, the owner of HESCO engineering company, sheds more light on financial links between Syria's regime and the Islamic State of Iraq and the Levant (ISIS or Isil or Islamic State or Daiesh).

In public, the two belligerents claim to be sworn enemies. Isil has vowed to topple Mr Assad and transform Syria into an Islamic "Caliphate". But the rise of the jihadist movement has served Mr Assad's interests by allowing him to pose as an essential bulwark against Islamist terrorism.

Isil fighters captured the oilfields of eastern Syria in 2013. Since then, the regime is believed to have funded the jihadists by purchasing oil from Isil. But those links are understood to extend further than was previously thought. Instead of merely being a customer for Isil's oil, the regime is understood to be running some oil and gas installations jointly with the terrorist movement.

Mr Haswani's company, HESCO, operates a gas plant in Tabqa, a town in central Syria which was captured by Isil last August. Officials believe this installation is being run jointly by Isil and personnel from the regime. The gas facility continues to supply areas of Syria controlled by Mr Assad.

Other oil and gas fields in Isil's hands are thought to be operated by personnel who remain on the payroll of the regime's oil ministry. The oil is then sold to Mr Assad, who distributes it in areas he controls at relatively low prices, helping him to win the loyalty of local people.

People walk on rubble as others try to put out a fire after what activists said were airstrikes followed by shelling by forces loyal to Syria's President Bashar al-Assad in the Douma neighborhood of Damascus, February 9, 2015. REUTERS/ Mohammed Badra

Sometimes, the regime has paid for the oil by supplying Isil-held towns with electricity.

Mr Haswani, a Christian from the town of Yabroud, will be forbidden from visiting any of the EU's 28 member states from Saturday onwards. Any assets he holds in EU banks will also be frozen.

Philip Hammond, the Foreign Secretary, described Mr Haswani as a "middleman buying oil from Isil on behalf of the regime".

Mr Hammond added: "This listing gives yet another indication that Assad's 'war' on Isil is a sham and that he supports them financially."

Oil probably amounted to Isil's single biggest source of revenue, allowing the movement to achieve financial self sufficiency and avoid dependence upon outside donors. But this could be changing.

Western intelligence services have placed Isil's oil business under the microscope with the aim of identifying its weaknesses. The goal is to discover the "various points, from upstream to downstream, which might present vulnerabilities," said a senior US Treasury official.

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The studies have concluded that Isil's refineries are the weakest link. Facilities of this kind have duly become a priority target for US and allied air strikes in Syria. About 200 such installations have been destroyed with "enormously disruptive" consequences for Isil's finances, said the official.

"We believe there to be a major decrease in their oil revenues from those strikes," he said. "It's the reason why we think 2015 will show a substantially reduced set of oil revenues from 2014."

However, Isil is believed to have adapted its strategy. It now uses smaller and more rudimentary refineries which are harder to target and easier to repair if they are damaged. The movement is also looking for alternative sources of revenue. One possible motive for its decision to loot the ancient city of Nimrud could be to sell priceless antiquities to smugglers.

The addition of Mr Haswani to the sanctions list brings to 55 the number of Syrian companies and individuals singled out for EU counter-measures. Another company added to the list on Saturday is accused of supplying Russian-produced banknotes to the Central Bank of Syria. DK Group is described as transferring the banknotes in cargo aircraft flying from Russia to Damascus via a variety of third countries.

This article was from The Daily Telegraph and was legally licensed through the NewsCred publisher network.