War for Oil?

national | miscellaneous | news report

Friday March 21, 2003 23:20

by Avi H.

Is the war with Iraq about oil when all is said and done? An essay by Jerry Taylor on the BBC web site.

The anti-war movement seems to think so. I am not so sure.

Unless the peace movement has discovered telepathy, I doubt that it's in any better position to divine the hidden thoughts or secret motivations of George Bush and Tony Blair than I am. Arguing about unstated motives, therefore, is a waste of time - claims cannot be proven or disproven.

Is it so difficult to imagine that both Bush and Blair sincerely believe - rightly or wrongly - that a well-armed Iraq poses an intolerable danger to the civilized world? If access to oil were of concern to them, one might have expected members of their administrations to hint as much. After all, the Thatcher and Bush "senior" administrations were quite open about the role that oil played in justifying the first go-around in Kuwait. Polls in the United States revealed at the time, moreover, that the public responded favourably to the argument. Why the supposed reticence now?

Regardless, it's difficult to know exactly what's being alleged when one is confronted by the slogan "No Blood for Oil!"

If the argument is that war is primarily being executed to ensure global access to Iraqi oil reserves, then it flounders upon misunderstanding. The only thing preventing Iraqi oil from entering the world market in force is the partial U.N. embargo on Iraqi exports. Surely if access to Iraqi oil were the issue, it would have occurred to Bush and Blair that removing the embargo is about 100 billion dollars cheaper - and less politically risky - than going to war.

If the argument is that war is being undertaken to grab Iraqi reserves, flood the market with oil, bust the OPEC cartel, and provide cheap energy to western consumers, then war would be a dagger pointed at the heart of big oil companies. That's because low prices equal low profits. But if the market were flooded with cheap Iraqi oil, it would also wipe out the small-time producers in Texas, Oklahoma, and the American Southwest that President Bush has long considered his best political friends.

Accordingly, it's impossible to square this story with the allegation that President Bush is a puppet of the oil industry. If oil company "fat cats" were calling the shots - as is often alleged by the protesters - President Bush would almost certainly not go to war. He would instead embrace the Franco-German-Russian plan of muscular but indefinite inspections. Because keeping the world on the precipice of uncertainty regarding conflict is the best guarantee that oil prices, (and thus, oil profits,) will remain at current levels.

If the argument is that "Big Oil" is less interested in high prices than it is with outright ownership of the Iraqi reserves, then how can we account for Secretary of State Colin Powell's repeated promise that the oil reserves will be transferred to the Iraqi government after a new leadership is established? Do the protestors think that this high-profile public commitment is a bald-faced lie? If outright ownership of oil is the real goal of this war, then I'm forced to wonder why the U.S. didn't seize the Kuwaiti fields more than 10 years ago.

If the argument is that this war is aimed at installing a pro-American regime more inclined to grant oil contracts to American and British rather than French and Russian oil firms, then it invites a similar charge that France and Russia are against war, primarily to protect their cosy economic relationships with the existing Iraqi regime. Regardless, only one or two American or British firms in this scenario would "win" economically while the rest would lose because increased production would lower global oil prices and thus profits. Because no one knows who would win the post-war contract "lottery," it makes little sense for the oil industry (or the politicians who supposedly cater to them) to support war.

Moreover, the profit opportunities afforded by Iraqi development contracts are overstated. The post-war Iraqi regime would certainly ensure that most of the profits from development were captured by the new government, whose reconstruction needs will be monumental. In fact, Secretary Powell has repeatedly hinted that Iraqi oil revenues would be used for exactly that purpose. Big money in the oil industry goes to those who own their reserves or who secure favourable development contracts, not to those who are forced to surrender most of the profits up-front through negotiation.

If the argument is that the United States is going to war to tame OPEC by ensuring that a puppet regime friendly to America holds the second largest reserves within the cartel, then it runs up against the fact that the United States has never had much complaint with OPEC. Occasional posturing notwithstanding, both have the same goal: stable prices between 20 and 28 dollars a barrel. The cartel wants to keep prices in that range because it maximizes their profits. The United States wants to keep prices in that range because it ensures the continued existence of the oil industry in the United States without doing too much damage to the American economy. The United States doesn't need a client state within the cartel, particularly when the cost of procuring such a state will reach into the hundreds of billions of dollars.

Oil, however, is relevant to this extent: Whoever controls those reserves sits atop a large source of potential revenue which, in the hands of a rogue state, could bankroll a sizeable and dangerous military arsenal. That's why the United States and Great Britain care more about containing the ambitions of Saddam Hussein than, say, the ambitions of Robert Mugabe. Still, if seizing oil fields from anti-western regimes is the name of the game, why aren't U.S. troops massing on the Venezuelan border and menacing Castro "Mini-Me" Hugo Chavez?

In sum, the argument that the war with Iraq is fundamentally about oil doesn't add up. While everyone loves a nice, tidy political morality play, I doubt there is one to be found here.

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Yes, its about oil

by Graham Caswell

Fri Mar 21, 2003 23:41

While no operation on this scale ocurs for only one reason, oil is a big reason behind America and Britain's invasion of Iraq.

America's two biggest nightmares are (1) an Iranian-like coup in Saudi Arabia and (2) a switch by OPEC from the dollar to the euro.

Either could destroy the American economy

For info on oil peak production and increasing American (and world) dependency on Middle Eastern oil see an excellent lecture at http://www.rz.tu-clausthal.de/realvideo/event/peak-oil.ram or read the transcript at http://energycrisis.org/de/lecture.html (and spot the prediction of the Iraq invasion!)

For info on the threat to America from the switch from petro dollars to petro euros see http://www.feasta.org/documents/papers/oil1.htm and http://www.indymedia.org/front.php3?article_id=232701&group=webcast

The media hasn't done much to look at the world's dependence on oil (possibly because of the complicity of most people in the oil trade). nevertheless it is real and is a real reason for this war.

If America gets political control of Iraqi oil watch for Iraq switching back to dollars right away. And watch for American dominance over iraqi neighbours Saudi Arabia and Iran. A victory in iraq will greatly increase the security of America's lifeblood.

OIL .

by John

Fri Mar 21, 2003 23:52

To dismiss oil as one of the main reasons for this conflict is just ridiculous.

The US does not get much of it's supply from the middle east. The other two fossil-fuel hungry centres do, that is Europe and Japan. Both these groupings pose the greatest threat to us dominace on the world scale, in terms of political clout and competing economies. Thus by controlling Iraqi oil, the US breaks OPEC, and thus has leverage over the supply of oil to europe and japan.

Now i could go on and on about other things, but sticking to oil i've made my point.

I could be wrong though, and this could be the moment where the US brings "democracy" to the middle east.

you ask why isn't the US trying to overthrow Chavez? Where have you been?

by fuinseog

Sat Mar 22, 2003 00:16

The article says: "Still, if seizing oil fields from anti-western regimes is the name of the game, why aren't U.S. troops massing on the Venezuelan border and menacing Castro "Mini-Me" Hugo Chavez?"

Meanwhile back in the real world, the US is sponsoring coup attempts in Venezuela and filling Colombia (which happens to be on the Venezuelan border) with troops.

Any time I wonder if my anti-imperialist understanding of the world is some sort of warped conspiracy theory all I need to do is read an article like the one above to be reminded of just how baseless the opposing view is.

Thanks Graham for your response. The Euro explanation for the war is fascinating and very credible. Iraq switched its UN-controlled oil sales from the dollar to the euro and Iran has said it is considering this. Venezuela meanwhile is bartering oil, something which reduces dependence on the dollar.

Oil

by Graham

Sat Mar 22, 2003 00:56

It is true that the middle east represents only about 20% of US oil imports. However the trend is for America to become more dependent on the Middle East (and of the five ME producers Iraq is one and borders 3 more).

However its not just about where imports come from - its about price. America is far more oil dependant than any other nation - the average American uses twice as much oil as the average European, for example. America is hard-wired for cheap energy and its economy is uniquely vulnerable.

Right now Saudi Arabia controls almost all of the world's 'swing supply' - the ability to tuen up the taps and quickly increase supply and reduce twice. Keep in mind that 15 out of 19 Sept. 11th hijackers were saudi and a recent poll suggests that Saudi support for America is in the low single digits. A coup in Saudi Arabia would dramatically increase oil prices, just like the Iranian coup did.

America has no excuse to invade Saudi Arabia, of course, but Sadam's history gives it an arguable fig leaf to invade iraq. You can be sure there'll be a lot of US military stationed on Iraq's southern border and, if there ever is a coup against the sauid royal family, they can expect rapid American assistance.

America needs oil like an addict needs a fix and a politically secure oil supply is reason enough for it to throw aside international law and attack Iraq.

Not about oil!

by an informed individual

Sat Mar 22, 2003 01:30

This war is not about oil for the simple reason that it is costing U.S far more money than they will ever recieve back by getting their hands on the oil in Iraq in Iraq. This war is about establishing a western and more importantly an American foothold in the middle east. From Iraq they can spread their wings into more important and powerful countrys such as Iran and Syria, and from their can control the media, destroy Islam and make a handy few dollars in the process. This war is empire fueled by oil do not be niave as to argue that this war is about controlling the Iraqi oil supplies its much deeper and more sinister than that.

www.dieoff.org - the truth

by As do ,many other oilmen

Sat Mar 22, 2003 03:40

the truth about oil from scientists - the guy who ran this site cracked up and quit but it is still there

AVI IS RIGHT

by avid avi fan

Sat Mar 22, 2003 09:50

It has nothing to do with oil ....
It is in fact all for the sake of the environment ... the oil fields have to be captured but not because the US wants that oil ...
a thousand times no ... they will hold it in escrow for the iraqi people ....
The point is that that evil tyrant hussein must be prevented from unleashing an ecological catastrophe by burning the oilfields or doing some such mischief .....

So the US is motivated by love of the environment, that is why the Green Party opposes direct action ....

Hey fuinseog!

by Seanin

Sat Mar 22, 2003 09:55

Have you got any good reliable links about the US and Chavez?

blood of the economy

by simon

Sat Mar 22, 2003 12:00

Oil is the blood of the economy. It is naieve to underestimate the importance it has in the eyes of the US admin.(or any country for that matter, each and eveyone of us are using oil in our lives everyday) Aside from obvious evidence in the form of previous Energy commitee statements, assisting coups to install 'friendly' oil sharing governments, if the admin can pull away from treaties such as Kyoto as a means of keeping the economy running on overcharge it means economy overrides all obligations or moral boundries.

This war was decided a long time ago events such as 9/11 have provided digestable excuses for some of the American public. But is interesting to see how bush has managed to desintegrate the level of international solidarity that was so strong and clear after 9/11. Anyway oil security is an major element (not the only one) that drives American foriegn policy and that cannot be denied.

It's about OIL - not money

Sat Mar 22, 2003 22:18

It is disingenious to say that 'there are cheaper ways of getting Irqi oil'. This is not about money, but about political control.

A dollor won't be worth nearly as much in a world where OPEC charges in (expensive) euro. Fundamentalists have higher values than money. Even secularists can have other injterests than maximising income (such as hurting America as much as possible).

This is not about money - its about REAL control over oil - the lifeblood of America.

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