Oil and the Looming Threat to Iraq

Oil and the Looming Threat to Iraq

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Access to and control of Middle East oil has figured prominently in the strategic thinking of American policy makers. In the Bush administration, State Department policy planners discussed scenarios for taking over by force the oilfields of the Middle East, and internationalizing them.


Jane Mayer revealed in the New Yorker that a secret Bush National Security Council (NSC) document dated Feb 3, 2001, instructed NSC members to cooperate with Vice-President Dick Cheney’s Energy Task Force for ‘reviewing international policy towards rogue states” and “actions regarding the capture of new and existing oil and gas fields.”  (Feb 16. 04)


The Bush administration has denied that the Iraq war was for oil, and proclaimed its commitment to the preservation of Iraq’s sovereignty and Iraq’s territorial integrity. Recent events, however, indicate that oil is playing a role in the looming threat to Iraq’s sovereignty and territorial integrity.


Sovereignty under occupation is at best nominal anyhow. Support for Iraq’s territorial integrity offered the prospect of a strong central government able to contain the conflict from spreading into a wider regional war.


It also offered the best guarantee of achieving two of Washington’s important goals in Iraq: access to Iraqi oil and an ‘enduring’ relationship with Iraq that gave Washington, through an Iraqi national oil law, the access and control it sought.


Shortly after President Bush announced in February last year his new military strategy of escalation of the war in Iraq, then-U.S. Ambassador Zalmay Khalilzad welcomed progress toward an Iraqi oil law, and explained its importance in American strategic thinking about the future of Iraq:.


“This is a significant political achievement,” Khalilzad said on Feb 27, “Under the approved law, oil will become a tool that will help unify Iraq and give all Iraqis a shared stake in their country’s future.” (Washington Post. Sept.5. 07)


Far from unifying Iraq, however, American pressure for an oil law is dividing the Iraqis, weakening the central government, and strengthening the separatist tendencies.


As Antonia Juhasz explained in the New York Times, the oil law being pushed by the Bush administration would transfer control of Iraqi oil from the Iraqis to international oil companies. It would leave The Iraq National Oil Company with exclusive control of only 17 of Iraq’s 80 oil fields, leaving the rest as well as the yet undiscovered oil fields open to foreign control. The foreign oil companies would enjoy highly advantageous profit-sharing production agreements with no obligation to invest in the country, to employ or train local manpower, or to transfer technology to the Iraqis. (March 13.07)


This did not escape the attention of the Iraqi people a majority of whom are reported by various opinion polls to believe that the American invasion of Iraq was primarily motivated by the desire to rob the Iraqis of their oil wealth.


In an open letter to the Iraqi parliament, a group of 419 Iraqi academics, engineers and oil industry experts stated that “it is clear that the government is trying to implement one of the demands of the American occupation.”


The draft oil law, the letter stated, “lays the foundation for a fresh plundering of Iraq’s strategic wealth and its squandering by foreigners, backed by those coveting power in the regions, and by gangs of thieves and pillagers.” (Washington Post. Sep 5, 07)


Growing opposition to the oil law at the national level in Iraq, and the failure of Bush’s strategy of military escalation to stamp out the insurgency, or to secure compliance from Baghdad with Washington’s agenda, could not be denied in Bush’s ‘progress’ report to the Congress in September.


Bush seems to have given up hope that a strong central government in Baghdad could ever help him achieve his goals in Iraq.


Last September, the US Senate voted overwhelmingly in favor of carving up Iraq into separate autonomous regions. Senator Joseph Biden, author of the bill, stated in a television program that failure in Iraq was inevitable and that: “there is no possibility—no possibility—of a central government governing Iraq in any near term.” (Meet the Press, Sep 9.07)


A year and a half ago the Bush administration had dismissed the Bidden proposal for partitioning Iraq as “as an unworkable and irresponsible prescription for breaking apart Iraq.” (Los Angeles Time, Sep 27.07). The adoption of the bill by the Senate in September met with no similar condemnation from the Bush White House.


That is because the Bush administration, as Iraqi analyst Raed Jarrar has shown in a co-authored analysis, is backing the separatists., the Iran’s hardliners and the Sunni fundamentalists: “All are working — separately, but towards the same ends — against the wishes of a majority of Iraqis, who polls show want a united, sovereign country in control of its own resources and free of meddling by Washington, Tehran and other foreigners.”


This has emboldened the Kurds in Northern Iraq who proceeded to act as if they were an independent state and signed their own contracts with foreign oil companies. A noticeable beneficiary of these contracts is Hunt Oil of Dallas. Hunt Oil is owned by Ray Hunt who has close ties to the Bush White House. Hunt also serves on the President’s Foreign Intelligence Advisory Board.


Hunt would not be gambling the future of his company in a dangerous region if he did not have privileged knowledge of Bush’s thinking about Iraq. As Paul Krugman of the New York Times put it: “The smart money, then, knows that the surge has failed, that the war is lost, and that Iraq is going the way of Yugoslavia.”



Prof. Adel Safty is Distinguished Visiting Professor at the Siberian Academy of Public Administration, Novosibirsk, Russia. He is author of From Camp David to the Gulf, Montreal, New York; and Leadership and Democracy, New York.


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