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Abu Ahmed at first welcomed the takeover by Isis,

Sunni Muslims in both countries have long felt discriminated against by regimes dominated by rival sects

without an economy that gives people a chance to make a living, many say Isis has little more to offer

“Compared to past rulers, Isis is a lot easier to deal with. Just don’t piss them off and they leave you alone,” says Mohammed, a trader from Mosul. “If they could only maintain services — then people would support them until the last second.”

“They’re operating like something between a mafia, an insurgency and a terror group. Maybe they thought six months ago they were going to function as a state. But they don’t have the personnel or manpower.”

the FT found its attempt at state-building has so far failed to win over locals.

volunteers handing out sacks of wheat stamped with their black and white seal. They even announced plans to issue a currency,

In some cases they say Isis takes credit for systems in place before it seized power. In others, locals say it is stealing the resources of the region it seeks to rule

Travellers must stock up on Iraqi dinars to use in Iraq, US dollars for the road and Syrian pounds once they arrive.

“I’m against Isis with all my heart,” Mahmoud says. “But I can’t help but admire their cleverness.”

Isis struggles to balance its books,

services continue to function because of the money Baghdad still pays to former civil servants in Mosul. Isis taxes those employees at up to 50 per cent of their salaries.

It is as if Isis is financing itself partly through a pyramid scheme, and this has begun to falter.”

Though many now question Isis’s economic management, its military prowess and organisational skills are clear.

Isis allows easy movement through its territories to facilitate trade. Trucks passing through are taxed about 10 per cent of the value of their cargo.

“I may be a Salafi, but I’m not an idiot,” he jokes.

Venezuela is one of the world's largest oil exporters, but thanks to economic mismanagement it was already finding it difficult to pay its way even before the oil price started falling.

Saudi Arabia, the world's largest oil exporter and Opec's most influential member, could support global oil prices by cutting back its own production, but there is little sign it wants to do this.

There could be two reasons - to try to instil some discipline among fellow Opec oil producers, and perhaps to put the US's burgeoning shale oil and gas industry under pressure.

Saudi Arabia needs oil prices to be around $85 in the longer term, it has deep pockets with a reserve fund of some $700bn - so can withstand lower prices for some time.

were to force some higher cost producers

In the 1980s the country did cut production significantly in a bid to boost prices, but it had little effect and it also badly affected the Saudi economy.

Saudi Arabia, Gulf producers such as the United Arab Emirates and Kuwait have also amassed considerable foreign currency reserves, which means that they could run deficits for several years if necessary.

Islamic State, capturing oil wells. It is estimated it is making about $3m a day through black market sales - and undercutting market prices by selling at a significant discount - around $30-60 a barrel.

"The growth of oil production in North America, particularly in the US, has been staggering," says Columbia University's Jason Bordoff.

It has been this growth in US energy production, where gas and oil is extracted from shale formations using hydraulic fracturing or fracking, that has been one of the main drivers of lower oil prices.

"Shale has essentially severed the linkage between geopolitical turmoil in the Middle East, and oil price and equities," says Seth Kleinman, head of energy strategy at Citi.

With Europe's flagging economies characterised by low inflation and weak growth, any benefits of lower prices would be welcomed by beleaguered governments. A 10% fall in oil prices should lead to a 0.1% increase in economic output, say some. In general consumers benefit through lower energy prices, but eventually low oil prices do erode the conditions that brought them about.