I am about to be traveling, but I wanted to throw this out for discussion. Over the past few years, I have heard various claims that oil companies were complicit/ultimately responsible over the Iraqi invasion. People have suggested that Big Oil was behind it, or supported it, and that they should be billed for the invasion. Or, that the military expenditure there is really a hidden subsidy for oil companies. This all seems to be widely-accepted “fact.”
I have stated on many occasions that the military expenditures may indeed be a hidden subsidy, but it is a subsidy for consumers. It is an attempt by politicians to keep energy prices down. If oil prices go up because of instability in Iraq and the Middle East, oil companies still make money. But if oil prices go up and the economy stumbles, politicians risk losing their jobs.
This discussion just came up in a thread at The Oil Drum, when someone claimed:
I do apologize for observing that your friendly neighborhood oil company (XOM, etc.) certainly had a massive role in the march to invade and occupy a foreign country.
I asked for evidence of this (surely there must be evidence of such a massive role?), and when none was forthcoming (“I could only hint at critiques, and speculation”) I wrote:
Think about it. What do you think was the goal of the administration in invading Iraq? Do you think they intended to make oil more expensive? That’s what has happened, but of course that wasn’t the intent. The intent was stability, more supplies, and ultimately lower prices for consumers.
Do you think lower prices for consumers is XOM’s business model?
Someone else posted the following in response to my request for evidence:
Since it was brought up in these comments, I wish to address the question of whether Cheney and the oil companies had a complicity in the invasion of Iraq. Please refer to these documents produced under the Freedom of Information Act.
http://www.judicialwatch.org/iraqi-oil-maps.shtml
Why in the world would they be divying Iraq up unless they planned to gain control of the country — i.e. invasion and occupation?
So, I thought “Here it is. Someone has found a smoking gun.” What I found was nothing of the sort, so I responded:
Unless my eyes deceive me, I don’t seen any American oil companies on either list. What I do see are companies that were doing business in Iraq prior to the invasion. So let me make sure I understand this. A list of non-American oil companies that were doing business in Iraq prior to the invasion somehow implicates Big Oil in the invasion?
I also note that they had maps of Saudi Arabian and United Arab Emirates (UAE) oil fields. Does this mean we are getting ready to invade them as well?
You guys are really reaching here. I thought someone was going to show me where Rex Tillerson made a speech denouncing Hussein and arguing for an invasion.
Now, I am open to evidence. What I say is that I have never seen anything that would lead me to believe that Big Oil wanted Iraq invaded. But I am persuaded by evidence. Does anyone have any to support this idea? I don’t claim that oil companies do no wrong, but I just don’t believe this charge sticks. Convince me.
I know better than to post something controversial like this on my way out of town, as it is sure to bring the trolls out. But I ask that people please stick to discussing this topic: What, if any, role did oil companies have in invading Iraq? What would be their motive? What is the evidence?
Probably offline now for a few days, although I will try to check in at some point and deal with trolls as needed. In the mean time, the trolls are in your hands. I do want to note that I have received some recent legal counsel over the blog, and will be putting up some disclaimers soon. One of them revolves around the fact that I am only speaking on behalf of myself. I do not identify myself as an employee of a specific company, as that might imply that I am authorized to speak on their behalf. I am not. However, at times people have attempted to “out me.” From now on, any comment that identifies me as an employee of a specific company will be automatically deleted in order to avoid any appearance of official sanction.
Oh God Iraq.
No comment, just the acknowledgement of what you’re digging up. Enjoy your trip Robert. 😉
Btw, higher prices do in fact benefit western states. Darkest africa just gets priced out. Demand destruction. If you want us to dip into conspiracy theory Robert there you go.
And just look at the solar map of africa… 😉
Hey, let’s chat about sweet sorghum ethanol. ;-]
From David Strahan’s site:
http://www.davidstrahan.com
Asked about Iraq, Mr Tillerson said “We look forward to the day when we can partner with Iraq to develop that resource potential…As a business-person not a politician we hold out great hope in our prayers for Iraq to succeed as a nation”.
Even the mighty oil companies can’t operate in a war-torn country. I am ashamed of my Government’s actions in Iraq, but the situation is not much good to big oil either. I can’t bear to think about those that did put the case together to invade Iraq, but I don’t believe it was big oil.
However, there must have been some oil ‘experts’ consulted beforehand about the oil resources or production potential in Iraq? I have no idea who..
Jeff Wells does conspiracy well…
http://rigint.blogspot.com/
Ahoy.
Hi. I wrote about Iraq for a couple of years as a journalist, and spent a lot of time covering the various iterations of the oil legislation that still hasn’t been passed.
I don’t think that the US government went in with the intent of some crass extractive colonialism, but oil played a part in the decision-making – not least because Hussein had attempted to gain regional primacy by taking the oilfields of Kuwait and threatening the fields in Saudi. Had he succeeded, he would have had a lot of clout internationally. So it’s disingnuous for anyone to claim that oil didn’t feature in the analysis.
Unfortunately, that is often conflated with the Bush Admin’s stupid ideas about how the war and reconstruction would be paid for. They assumed that Iraq’s oil revenues would pay for the reconstruction of the country, and Bremer’s CPA acted pretty much like the ruling family of a Gulfi state circa 1960, the way it threw money around. Then they realised that production levels were down, and brought in Halliburton et al to patch up the fields – creating further scope for allegations of bias.
The final straw was the production sharing framework that was in the first version of the oil bill. Consumer countries and oil companies like PSAs, while resource-rich countries tend to think they’re a bad idea. It’s not a conspiracy that it was in the bill, so much as the inevitable consequence of it being drafted by people who have a particular way of looking at things. Look at the dynamic between foreign companies and local governments in Latin America to see that there is still strong disagreement over how to share the risks and rewards of oil extraction.
So I think the best way it can be put is that the US was in a position in which it was making decisions about oil in Iraq which were self-interested primarily because of the lens through which the US views the world, not because of some shadowy post-colonial extractive conspiracy. I think the fact that those plans have screwed up royally shows how it’s about the lens – had it been a shadowy conspiracy, surely they’d have done a better job?
If we really wanted to get more oil out of Iraq, we would have dropped sanctions against Saddam and cut a deal with him (with conditions that US oil companies get their share.) Saddam would have jumped at the chance. Exxon, et al would have loved that as well.
Instead, we started a long, bloody war which further damaged the oil infrastructure.
As IHS (not that long ago) and others have pointed out, there is a lot more oil under Iraq than was generally believed.
http://peakenergy.blogspot.com/2005/08/greatest-prize-of-all.html
That oil was found a long time ago – as far back in the 1920’s, and its existance covered up and “forgotten”.
http://peakenergy.blogspot.com/2005/05/control-of-oil.html
http://www.globalpolicy.org/security/issues/iraq/history/1976blairoil.htm
http://www.globalpolicy.org/security/oil/irqindx.htm
Why do you think the new oil law hands over the “undiscovered” oil to foreign oil companies ?
http://kucinich.us/node/4547
http://www.truthout.org/docs_2006/052607Z.shtml
http://www.commondreams.org/archive/2007/03/30/201/
As for oil industry involvement in pushing for or planning the invasion itself, the story is pretty vague – Greg Palast has some thoughts on the subject.
http://www.gregpalast.com/secret-us-plans-for-iraqs-oil/
Given the history of British and US involvement in Iraq since the start of World War 1, its hard to see that the invasion was about anything other than controlling the oil (which is very different to wanting to push the price up or down).
Read John Blair’s book – the history of the oil industry over the past century is the history of the struggle to control middle eastern oil and thus to control the amount of oil available on the market (peak oilers mostly worry about lack of supply, forgetting that the problem for the oil industry traditionally has always been the exact opposite).
big gav,
As discussed in the 7/2/2007 issue of the Oil and Gas Journal, nobody in the industry believes the IHS numbers for the western desert of Iraq (except people who want to believe in a conspiracy).
The best conspiracy theory on the Iraq war is one of the oldest ones out there and is very well documented. PNAC -http://www.newamericancentury.org/
The neocons took over when Bush took the White House. Iraq was the weakest target they could find that mattered (axis of evil). It was about starting a new cold war to fire up the aging war machine. As there was no easily identifiable enemy, the war against nobody was sold to the US public (aka the war on terror). Oil interests abound in Washington and it would be naive to believe they didn’t line up behind the neocons strategy but it was never about oil. The fact that the whole bloody mess has blown up in their faces doesn’t change their original strategy.
Gwynne Dyer’s book Future: Tense was a very good look at the neocons motivations in Iraq.
Another good read on the current situation in the Middle East is Confronting Iran by Ali Ansari. He maintains that the neocons are at the helm in Iran as well (parading as Islamic fundamentalist) and the two groups reinforce each others existence. The neocons want to remove the UN as a force in international relations and replace it with US global hegemony. The peerless empire of Bush and company (insert maniacal laugh).
“But I am persuaded by evidence. Does anyone have any to support this idea?”
Oh come on! What, you think someone has been holding on to evidence, just waiting to tell you?
There were dozens of factors contributing to the Iraq invation … this discussion is really about weighting, right?
How much weight do we assign to each factor … that’s a tough game.
For what it’s worth, I think “oil” was a significant factor, but I don’t think US oil companies were the ones driving that.
Borrowing from “matt h2o” and “andrews416”: I think there was a general concern about oil security, among other things, and a new militarist way of thinking about those problems.
(It was a different world, a few short years ago, when Andrew J. Bacevich wrote “The New American Militarism: How Americans Are Seduced by War”)
matth2o – Consumer countries and oil companies like PSAs, while resource-rich countries tend to think they’re a bad idea.
Let me stick up for PSAs. Yes, international oil companies (IOCs) like PSAs because accounting rules allow the IOC to book the reserves as an asset. Stock analysts use reserves estimates as a benchmark for valuing the company.
No doubt that if your goal is only to maximize over the long run the share of oil proceeds returning to the state, PSAs aren’t the way to go. You should start a national oil company and try to develop the reserves on your own. However, this ignores two important concepts, time value of money and risk. Count on it taking decades to get up and running.
In a PSA, you get money for your reserves up front through a lease sale. Companies competitively bid on the rights to develop reserves under the PSA. They will pay an up front premium plus bid a royalty rate. The IOCs use their own money and balance sheet to finance the operation. If the venture fails, the host company keeps the premium and gets the reserves back at the end of the term of the PSA.
If the venture suceeds, the host country gets access to world class expertise, cutting edge technology, and loads of capital for developing your resources. The IOCs are not plagued by the corruption endemic to the state owned companies. You also don’t have to worry about transporting and marketing your oil and gas. The IOC essentially takes all the risk. You get oil revenues immediately, in premiums, and royalties and taxes quicker. But for this service they extract a price.
Immediate access to oil money would allow Iraq to rebuild its infrastructure and to use oil revenues to diversify its economy.
Or, they could let INOC develop all the reserves. In which case it will most likely have to develop a “pay as you go” model where INOC uses cash from current operations to fund growth. So the government has to prioritize competing needs.
My advice to Iraq would be to do both. Set aside some of the reserves exclusively for INOC and other Iraq companies. On other blocks allow IOCs to bid and develop. As Iraq grows and its oil company emerges, the state companies can gradually take a larger role.
I hear this nonsens all the time about IOCs “stealing” countries oil wealth. Rubbish.
A few years ago I was involved in negotiating a deal for some unconventional oil and gas reserves in an unmentionable country. It illustrates the problem we have in Iraq.
We learned of these reserves by accident. Through publicly available data we did an analysis on them and estimated the size of the prospect. I approached the state ministry with a plan to develop the reserves. We were willing to agree up front to a certain royalty and tax rate for the development. Our company would spend substantial money up front to do all the required evaluations, permits, engineering, and everything to get started. All at absolutely no cost to the host country. We took a contingent from the state oil company and the ministry to one of our existing operations where we showed them basically how it was done. They were most impressed.
When we got to negotiations, things fell apart. Essentially the host country said they wanted us to do the up front work, for free, then they would put the development up for competitive bidding. That was unacceptable to us. Why should we put all the money at risk and end up with nothing in the end? Finally our walk away position was that we got the right to match any competitive bid, and if we lost recovered all our investment plus a small profit. Still not acceptable to them.
The host country kept emphasizing how the reserves belonged to their country and how valuable they were. To which we replied, without our capital and knowledge the reserves were essentially worthless. Then they said well we might get around to developing them in 20 or 30 years. To which we replied that money now is worth much more than getting money in 30 years.
Nearly 10 years later the reserves still sit undeveloped.
I think this is the problem in Iraq. Without access to capital, knowledge, and markets, the oil reserves in Iraq are not worth very much. The “No war for Oil” crowd would have you believe all the profit belongs with the reserves and none to the capital and knowledge.
“The ‘No war for Oil’ crowd would have you believe all the profit belongs with the reserves and none to the capital and knowledge.”
I don’t know anyone in the “no war for oil crowd” but that certainly could be compatible with ‘mercantile’ world-view. “No war” and let the profits fall where they may, right?
On the other hand, the further left you go on the American political scale, the more likely you are to find someone who is both anti-war and anti-corporate.
That certainly doesn’t mean the two are related. For decades in America the conservative position was anti-war and pro-corporate.
If you filter out the outright nutcases, there are a few voices making a nuanced “war for oil” case (like Roberts). Obviously we weren’t going to get an outcome where US oil companies gained outright ownership of Iraq’s reserves. The theory (from the left) is that the war was going to open up access for IOCs to help develop those reserves. Yes that might help their profits, but mainly their greater expertise was expected to boost output. I don’t really buy this theory because anyone with half a brain could see that the oil industry is not helped by having to operate in a war zone. If oil was the only motivation, a far easier and surer route would have been to cut a deal with Saddam. The other main theory (offered by the right) is that the war was really all about Iran. Again, anyone with half a brain could see that Iraq was the only credible force arrayed against Iran in the region, and that removing Saddam was only going to open the playing field for them. Honestly, I can’t imagine what W was thinking here. My suspicion is it was a mix of wanting to “finish the job” that Bush Sr. started and a naive but genuine belief that we could plant the seeds of democracy in the Arab world.
I suppose one could imagine conversations like this occuring:
Why Is Oil Worth Fighting For
http://www.arabnews.com/?page=7§ion=0&article=53666&d=30&m=10&y=2004
but that certainly could be compatible with ‘mercantile’ world-view.
My acid test for the anti-oil people is to ask if they like Wal Mart. If not, then I know I’m dealing with an anti-capitalist.
Personally, I love Wal Mart.
Doug is right, the more direct path to Iraq’s oil would have been to cut a deal with Sadaam.
The historians will decide whether the war in Iraq was a wise course or not. We likely won’t know for several decades. Many of the same anti-democracy arguments were made about both Japan and Germany following WW2.
KingofKaty
We don’t have Walmart over the pond, but we have Asda. Can’t say I love it, can’t say I hate it. It is what it is. 😉
Thanks for the interesting commentary on PSAs. I was trying to play it straight down the line: ultimately, it is a question of balancing risks and rewards between the organisation with the skills and the country with the resources. When the market tips in favour of the sellers, the countries tend to rip up contracts and to renegotiate on terms that suit them better; when the market tips in favour of the knowhow, they sell access to the resources for less than they *think* they are worth.
Me: I’m ambivalent, and I really don’t like overlaying any moral judgment on the dynamic. I’m a journalist though, so that goes with the territory.
In the case of Iraq, though, I think the main problem with the implementation of the PSA was the way that it was handled. Too much of the process of formulating the policy looked like it was being stagemanaged by the US, particularly during the days of Proconsul Bremer. The US should really have been smart enough to see how that course of action would have been perceived, particularly given that resources were a contentious issue even then.
I kind of see WalMart as a collection of good and bad. Scheduling employees to keep them below the health-care threshold is bad, their rapid response with water for New Orleans was good. Their lack of discrimination in overseas suppliers might be bad, but their drive for transportation efficiency is good.
But for what it’s worth, my sister (ex. of the oil service industry) now does environmental consulting for companies looking to “stay ahead” of overseas regulation and public opinion. She’s very corporate-friendly in general, they are her friends … but she teaches her children not to shop at WalMart.
Iraq? We do not need their oil.
OPEC yesterday predicted less demand for their product next year, not more. We have reached Peak Demand already.
So why did we invade Iraq? Surely, the trillion dollars we spend there is poorly invested, even if we flat out seized the oil fields.
Sometimes, in foreign policy, bad ideas get traction, like invading Vietnam. Once in, you have to prove you were right to invade. Then it becomes about honoring those who died.
Then finally (the stage in Iraq now) it becomes about getting out, but passing the buck to someone else for “losing.” Bu$h jr. wants the Dems to lose Iraq. They will.
No, the oil companies didn’t give a shit about Iraq. They would be much smarter. Just bribe Saddam enough, and get in to the fields.
This is Bu$h jr;’s war. Vietnam was LBJ’s war. Both had clutches of highly intelligent people in the White House, who somehow bought in to a crazy plan. It happens.
Cheney is a part of the oil industry, and maybe that is important. Actually, he was doing business with Iran in his Halliburton incarnation. And defending it vigorously. He also is on tape explaining (in an even earlier incarnation with Bush Sr.) that invading Iraq would result in a quagmire.
The good news is we don’t need their oil. We use twice the BTUs er capital as Great Britian. We have generations of declining oil use per capita ahead of us.
We are de-linking GDP growth from fossil fuel demand with each passing day.
FWIW, I wrote to President Bush before the invasion (this Bush, this invasion) and told him that I thought it failed tests of realpolitik and that it would yield blowback for generations.
Strangely, I thought we’d achieve a “seeming peace” relatively quickly, and that the blowback would be longer in coming.
So I was wrong, it was worse than I expected.
Odograph – you didn’t mention WalMart’s lower prices. I shop their occasionally. I can tell you that in my nearest Wal Mart english is a second language. The poor would be hurt most by closing WalMart. Not so true lately, but when we had foreign partners visiting the states the one place they wanted to go was the WalMart Superstore. They would bring huge suitcases and then pack them with socks, underwear, toothpaste, deodorant, and other basic necessities to return to their home countries. A few would just wander around in disbelief.
Matt H2O – When I lived in the UK I mostly shopped at Sainsbury’s and Safeway, sometimes Asda, but it is not the same as WalMart, although they own it. I miss English style bacon and Walker’s Crisps the most, although I never went for the really strange flavors (Lamb & Mint or Prawn Cocktail). But you probably think Nacho Cheese corn crisps are disgusting (me too).
Back to Iraq. We had this conversation a month or so ago. I maintained that the same “bad” companies accused of exploiting places like Venezuela and Iraq also developed the North Sea reserves, creating the MOST millionaires per capita in Europe (Norway).
As I’ve said before I favor a combination of state operated and foreign operated ventures, and creating direct benefits for the people in something like the Alaska Permanent fund. Othewise we get stupid policies like heavily subsidizing local gasoline sales just so the average citizen sees some direct benefit from the state oil company.
“Odograph – you didn’t mention WalMart’s lower prices. I shop their occasionally. I can tell you that in my nearest Wal Mart english is a second language. The poor would be hurt most by closing WalMart.“
I recommend the book called “trading up” by Michael Silverstein and Neil Fiske.
Their analysis, which seems to be supported by the data, is that Americans at all income levels scrimp on some things, to choose luxuries on other things. For the poor it might be a “small luxury” like a basic cell phone plan, or a Starbucks.
I think, without WalMart … I think Starbucks might be hurt … more than “the poor.”
Odograph – So you would deny the poor the occasional Starbucks?
I ride my bike to Target, only 1.5 miles from my house. Even bought 1/2 gallon of organic milk on Sunday, only because it was $.39 cheaper than the stuffed with yummy hormones brand.
My self-imposed 10 gallons of gasoline a week makes me think about my trips. Had to take my son to get new school shoes last night. That was an extra 8 miles I have to make up somewhere.
I never said anything that extreme.
I do think the secret to happiness is to understand happiness, and not to rely on luxuries (or Lattes) as a quick-fix.
But that’s true across the income spectrum.
(And if that lowers our environmental footprint even as it improves our wellbeing, that obviously a win-win.)
You answered your own question. Big Oil wanted us to invade Iraq because they don’t have a share of the oil wells. Dubya goes in and destroys the infrastructure, makes it impossible for anyone to get any oil out of there, and thus raise the price of oil around the world for the benefit of Big Oil (whose own reserves are not affected, because they are not in Iraq). Of course, there’s no proof of this, but that hasn’t stopped anyone before, now has it?
Dubya goes in and destroys the infrastructure
Wow, that evil genius! He has even managed to trick Combined Task Force 158 into carrying out his evil plan.
Oh wait, they are protecting Iraq’s infrastructure. Nevermind.
Common sense / conventional wisdom (OK, oxymoron alert) would seem to suggest that the last thing Big Oil would want is to have to deal with a fragile, ineffective coalition government for oil concessions. Clearly, a dicatorial, corrupt regime is a lot easier to bride, I mean negotiate with.
Not to mention the security, infrastructure, instability and hatred of foreigners that the recent “liberation” of Iraq has spawned.
Umm…no one seems to mention some rather blatant aspects of oil’s importance.
First, its control is considered a national security issue. It is not as if modern economies are run on a huge variety of energy inputs. Gasoline, plastics, industrial food production; all are dependent for all nations upon oil, so oil is not only important for Big oil’s profits, but for every other sector of a nation’s economy. Good to control vast amounts then, eh?
Ok, so what else? Well, until just last year, the only way to purchase oil was through two international markets, and those transactions had to be conducted with U.S. Currency. If the U.S. tossed aside the gold standard, upon which the entire post WWII global economy depended (Look up Bretton Woods), then there had to be some reason to rely on the dollar as the global reserve currency. Well, petro-dollar recycling and the limited oil/currency market system meant that the dollar retained immense value beyond its actual nominal worth. Without controlling both oil and oil markets the U.S. hegemonic project goes kaput. Don’t think that’s what worries the minds of the nation’s thinkers, then spend some time reading “Foreign Policy”. The thinking goes like this, “The U.S. Must remain as the world’s military/economic/technological hegemon, and it would be nice if human rights fit in there somewhere too…or not…whatever”.
So why go into Iraq? Well, Saudi Arabia’s ruling family is hated and was made very vulnerable by the presence of U.S. troops in the holy lands. But, the middle east must be controlled in order to guarantee the aforementioned oil/currency market system. The U.S. had to leave Saudi Arabia as a base of operations and the Iraq sanction regime was shredding to pieces, also European powers such as France and Germany had oil supply contracts with Saddam based upon Euros as the medium of exchange…and, well, Badda-boom! The U.S. had to invade Iraq so as to defend against “weapons of mass destruction”….
If this doesn’t make sense to you, then start reading about the U.S. post WWII, or Britain’s imperial project or any other empire’s domestic and foreign policy and you’ll probably get the drift right quick. There isn’t really a secret as to why oil is important, but the arguments above seem to confuse rather than clarify why the U.S. has gone crazy for invading oil rich/politically backward nations.
I’m fairly new here and besides that I know that I shouldn’t ever jump into an online discussion of this sort. But I would like to submit a thought that relates to oil reserves and the Middle East that is not often discussed.
It is my feeling that the question of why we engaged in the war in Iraq was in large part about neo-conservative beliefs regarding protecting American interests and reshaping the Middle East (see “A Clean Break: A Strategy for Securing the Realm” for a paper written by key neocons in the Bush admin in 1997 for Netanyahu as evidence). I also feel that access to more oil was an important consideration for the administration as a subsidy for the American citizen, just as Robert asserts. But I have a slightly different spin on what reserve of oil they had their eyes on.
As my (Israeli geo-physicist who specializes in oil exploration and politics) friend said, for years the public has discussed the “special relationship” between the United States and Israel while in fact the real “special relationship” was between the United States and the feudal lords of Saudi Arabia, where 2/3rds of the world’s global reserves ar elocated. This can be convincingly argued as the American economic engine is not only built upon cheap oil but it continues to depend upon it.
Meanwhile, the House of Saud has relied on the “special relationship” to maintain and protect a dictatorial, autocratic state that maintains a social and political framework that has a decidedly Middle Age flavor. See the recent sail of $20B in military equipment to the country, as well as that war back in the early 90s.
However, the radicalization of the Muslim world began to fray the fabric of this relationship began. In fact, one of Osama’s key demands, released in a fatwa in 1998, called for the “infidels be banished from the Kingdom”. One can imagine that the statement was made a bit louder on 9/11.
As a result, the House of Saud began to fear that not only would folks like Al Qaeda go after the Americans and other Western powers, they may turn to their attention to their welcoming hosts as well. In addition, the US saw that if a friendly, compliant government in Saudi Arabia were to be replaced by militant, oppositional, revolutionary leaders, the world’s economy would absolutely collapse. Forget about $100 barrels of oil – think $200+ barrels of oil!
So what was the US to do? It had to protect the House of Saud by easing anger and tensions towards its leadership. But it couldn’t abandon its presence in the Middle East and endanger the flow of cheap oil for global economy.
If we think about the war in that context then, doesn’t moving the 150K+ troops a few hundred miles north make sense? The government and army has been weakened by 10 years of military and economic sanctions. The US gets to take out that asshole who tried to kill one of our presidents. And maybe it gets access to another reserve of oil. And it’s still close enough to keep an eye on Saudi Arabia in case the shit hits the fan down there.
In fact, in an article written by Christine Spolar in the Chicago Tribune in 2004 entitled “14 ‘enduring bases’ set in Iraq Long-term military presence planned” there is this quote
“Is this a swap for the Saudi bases?” asked Army Brig. Gen. Robert Pollman, chief engineer for base construction in Iraq. “I don’t know. … When we talk about enduring bases here, we’re talking about the present operation, not in terms of America’s global strategic base. But this makes sense. It makes a lot of logical sense.”
So yes, this is a conspiracy theory. But I think there is evidence and support for it. So perhaps it can be upgraded to a working theory? 🙂
If there’s any room for conspiracy, someone will find an opportunity.
I gave a presentation about 18 months ago, outlining a five year view of oil markets (strong demand from China et al, tight supply, long term high prices). I made no reference to Iraq, but a delegate came up to me after to say “now I know why we invaded.”
For what its worth, I assume oil and broader energy security was a consideration when the decision to invade was made. But I don’t think it was the only one, and I don’t think Big Oil was a driver. More a government than oil company decision.
Brian – IHS are very much johnny come lately’s to the “Iraq has a lot more oil than you think” party – and they still underestimate the total amount of “undiscovered” oil there.
Read all the links embedded in these and you’ll see that there are rather a lot of organisations and individuals who believe Iraq has 300+ billion barrels of reserves left.
http://www.globalpolicy.org/security/issues/iraq/history/1976blairoil.htm
http://peakenergy.blogspot.com/2005/06/how-much-oil-does-iraq-have.html
http://www.brookings.edu/views/op-ed/fellows/luft20030512.htm
http://peakenergy.blogspot.com/2005/08/greatest-prize-of-all.html
Does that mean big oil organised the invasion ?
No – but it has been US policy to control middle eastern oil since the closing days of world war 2, so I’d certainly say that oil was why we invaded, even if Lee Raymond wasn’t sitting on Dick Cheney’s desk barking him orders while it was being organised…
“No – but it has been US policy to control middle eastern oil since the closing days of world war 2, so I’d certainly say that oil was why we invaded, even if Lee Raymond wasn’t sitting on Dick Cheney’s desk barking him orders while it was being organise“
I wouldn’t use the word “control” there. Influence perhaps. Certainly until the Carter Doctrine was enunciated things were often left to commercial interests.
The Carter Doctrine itself is significant because it promised action only *if*:
“Let our position be absolutely clear: An attempt by any outside force to gain control of the Persian Gulf region will be regarded as an assault on the vital interests of the United States of America, and such an assault will be repelled by any means necessary, including military force.“
Now, the crazy Neocons said they were only following the Carter Doctrine, but obviously they were extending it like gangbusters. No longer did we wait for “any outside force” to threaten the region, we went in to reshape the indigenous landscape.
That was both wrong and stupid at the same time.
KingofKaty – while all the debates were going on about the oil law’s PSA provisions, a couple of smart economists were chirping up about what a great idea it would be to adopt the Norwegian model. Not only would it make things a lot more transparent, but it would also head off a lot of the ethnoreligious tussling over the reserves, they argued. Nobody listened – which was, I think, one of the single greatest failures of vision on the part of the US proconsuls in Iraq.
matt h2o – I’ve argued in the past for the merits of the Noregian model. It is a combination of state and private development. They also have a fund for setting aside the oil revenues.
I don’t know culturally how it would work in Iraq, but it has lead to making millionaires out of Norwegians and raising the prospects of all citizens.
I don’t think the essay disputes that oil is why we invaded. I think the issue is that it was done by the government to keep the Middle East stable and energy prices low, as opposed to being encouraged by oil companies wanting access to resources.
Prior to the war, someone said something like “The good guys don’t shoot first”. I was with W when he cleaned house in Afghanistan. But then instead of finishing the job we started rattling the saber at Iraq. I used to argue endlessly with an Israeli friend about that in the weeks prior to the invasion, he said we needed to do it to “keep the war on terror out of the US”, whereas I didn’t think the stated case for war had been proven. If the real objective was to get rid of a bad guy and liberate the people, that should have been made clear. It wasn’t because most Americans wouldn’t want to give the lives of our soldiers no matter how bad some dictator was, provided he wasn’t overtly attacking us or our allies. Unfortunately (for the people in countries run by these desports) the thing that seems to have worked historically is to wait them out.
Just an observation- Keeping product prices below estimated long term replacement cost is a strategy to maximize profits.
OPEC has been explicit in that strategy, but major oil companies are probably in agreement.
Keeping product prices below estimated long term replacement cost is a strategy to maximize profits.
Keeping them above the cost of alternatives is a strategy for losing market share.
That’s a fair question. Here’s my take.
I don’t claim to know what Big Oil wanted. There is much conjecture, but next to no hard knowledge about what went on in Cheney’s Energy Task Force. Frankly I don’t think those Judicial Watch documents offer us enough information.
But we do know about the neocons’ agenda, which calls for maintaining and expanding America’s preeminent position in the world. Essential to this aim is gaining control of as much of the world’s remaining fossil fuel energy reserves as possible (1) for the use of the US and its allies and (2) to keep them out of the hands of competitors.
Hence, gaining some kind of control (economic or military) over Iraq’s (and perhaps Iran’s) rich oil and gas reserves would be of great importance to the neocon program. As oil gets more expensive and harder to get, control of oil confers ever greater geopolitical power to those who control it.
Note that I do not disagree with the thesis that oil is to be kept cheap. I just think there’s more to it.
re: Phil Hart (on David Strahan)
Strahan’s “The Last Oil Shock: A Survival Guide to the Imminent Extinction of Petroleum Man” is a good read.
I’m more focussed on checking out his comments on necoclassical economics, rather than “Why Iraq”, but his first chapter bears on this topic, indicating uncertainties and offering a useful Transatlantic viewpoint amidst some interesting tidbits.
Has anyone else read this? Comments?
[Note: Amazon UK or Amazon Canada, not US.]
A similar question is what role did the pro-Israel lobby play. Here again it is hard to bring evidence. The fact that some people in Israel were very happy about the war (and many were) are not enough to say that Israel had a major influence.
I don’t think it did. I have a feeling that the pro-Israel lobby plays a more important role now vs. Iran. But again these things are hard to prove.
(for the record I am Israeli and thinks that the Iraq war was a disaster for Israel and an attack on Iran would just make it worse).
The question is: the Bush administration has close links to big oil. How did their friends in the industry feel about Iraq? They probably didn’t think it was a very bad idea. Otherwise it wouldn’t have happened. But did they push for it? I doubt it.