The Middle East and Oil
August 15th 2008 -- Oil is for the moment what drives development in the world economy. Not only is it one of the main reference points for planning a country's political economy, but also the main component for any diagnosis of the health of the capitalist economic system as we know it.
Since 1908 when the first important oil deposits were found in Iran, developed countries, especially the United States, thought it strategically important to create States in that part of the world simultaneously loyal to it and indebted. So in 1922, it supported the creation of
The Iraqi Ba'ath party had overthrown the monarchy in a military coup in 1963. Its radicalization after Saddam Hussein came to power and its alliance with the
But the new States, aware of their power, sparked the first oil crisis in 1973. It is then that a series of studies was begun on known oil reserves, where there could be new deposits and how much time that finite fossil fuel might last. As a result of those studies, it is today considered that sufficient reserves exist to guarantee production at the same levels as now, or even greater levels, for approximately fifty years. So one can say that oil is a strategic resource in the medium and long term.
It happens that two-thirds of known reserves are in the
On the other hand, proven reserves in the whole American continent - North and South - are reckoned at just 13.6% of the planet's total and of that 13.6% three-quarters are in
The person who designed that strategy is a man who appears today as a champion of world peace, ex
The Carter Doctrine and the invasion of
In synthesis, the Carter Doctrine as it is known in the ambit of international relations, establishes that Persian Gulf oil reserves are a vital
A foreign policy decision of that calibre had to be backed up by military deployment and that us how the Rapid Reaction Force currently named the United States Central Command serving the Pentagon and the UK Ministry of Defence to carry out military operations in the Middle East from air bases in Bahrain, Diego Garcia (leased from Britain in the Indian ocean), Oman and Saudi Arabia. So, it is nothing new that the various US administrations since then (Reagan, Bush Sr., Clinton and Bush Jr.) made the Middle East a priority of their foreign policy and specifically the
It s well know that the
As a result of the embargo suffered by Iraq, imposed by the UN after Iraq's invasion of Kuwait in 1990, Iraq had its oil industry reduced to a minimum. However, it managed to get around some of those sanctions and had established agreements and signed contracts for future oil exploration and extraction with rivals of US oil companies, for example Total-Fina-Elf of France, Russia's Lukoil and China's National Oil Corporation. That is to say there were "other forces" trying to get control of one of most oil rich countries in the Persian Gulf. And the Carter Doctrine meant that was regarded as an attack on the vital interests of the United States, for which reason it was decided to invade Iraq.
Via that action, outside all international law, the US guaranteed control of Iraq's oil. A little known fact is that during the bombardment that began the invasion, the only Ministry not affected by the bombing was, exactly, the Oil Ministry. Something better known is that one of the first measures of proconsul Paul Bremer was to cancel contracts signed by Saddam Hussein's government with the companies mentioned earlier.
US strategy was twofold. In part it sought to normalize oil production and facilitate Iraq's exit from OPEC which would lead in the medium term to cheaper, more secure oil supplies, by lowering the oil price to around US$20. But also, were it not possible to normalize oil supplies, as was the case, the strategy sought to keep Iraq inside OPEC to reinforce the "moderate" position of States like Saudi Arabia while simultaneously threatening to increase production when possible.
Iraq's current Oil Minister, the collaborationist Hussein al-Sharistani, has said that the medium term objective is to market 4 million barrels a day, reaching 6 million a day by 2012. That would lower the price to around US$30 a barrel and hand control of the main Iraqi oil fields mainly to British and United States multinationals. (3) In either case, the US would be seen not as an imperial power breaking international law but as a still hegemonic but benign power for having lowered oil prices and prevented a worldwide economic recession.
Reinforcing Saudi Arabia
Five years after invading Iraq, one can say US plans have failed. The oil price reached as high as US$145 a barrel and there is a swelling current within OPEC on whether or not it is necessary to introduce other currencies like the Euro for oil's financial transactions. While friendly countries like Qatar, the United Arab Emirates or even Kuwait are reducing their dollar currency reserves and increasing the percentage of their reserves in Euros (4), only the Saudis and the Iraqis stay loyal to the US currency.
The fragile situation in the Middle East worries the main US ideologists. The fragility was accentuated in the summer of 2006 when the Lebanese political-military movement Hizbollah defeated the until then all powerful Israeli war machine. Thinkers like Patrick Clauwson or Michael Klave argue that if the US wants to maintain its dominance in the Middle East it needs to keep Saudi Arabia from becoming unstable since that country has 22% of the world's oil reserves.
Others are more radical, like Zbigniew Brezinski, ex national Security adviser and Richard Haas an adviser to George Bush. They think US dominance in the Middle East is over and that a new era has begun. These last two individuals, via different routes, agree in noting that "a new era has begun in the region's modern history... in which one has to take into account the preponderance of local forces (ie countries) faced with external actors (traditionally influential powers like the US)" (5).
Neither Brezinski nor Haas say it straight out, but one can assert that a new regional security structure is forming including various countries : Saudi Arabia, Turkey, Syria and Iran. Of these the first and the last - the two countries with the region's largest oil reserves - are the most active in moving their pieces on the regional board. Saudis and Iranians The Saudis and the Iranians are entangled in a muffled struggle for control not any longer of the Middle East but of the Maghreb and the Far East.
In the Iranian case it has no godfather and acts as it does as a result of the failure of US strategy in Iraq. But in the Saudi case it is obvious they would not have dared to take that step towards acting as a regional power without the support and complaisance of the United States, since Israel is sunk in a deep crisis following its failures in Lebanon in 2006 and in Gaza in 2008.
The role Saudi Arabia has played and continues to play in Lebanon is symptomatic. It was the country that created most difficulties for a political agreement. It maintained a hard critical line against Hizbollah and has stayed on the edges of the agreement negotiated between the pro-Western forces and the Lebanese nationalists in Qatar last May, by virtue of which the pro-Western forces and the Saudis lost power.
..and ensuring water
However, while oil is the current nub of the conflict in the Middle East with its repercussions in the world economy, one should not lose sight of the fact that the next looming crisis in the region might be over water. Oil deposits remain and even grow as new deposits are discovered. In fact today, production is at the same level it was two years ago, about 85 million barrels a day. But that is not the case with water resources, at the moment about 1% of the world's total.
Countries like Bahrain, Jordan, Kuwait, Qatar, Saudi Arabia, Yemen, the United Arab Emirates, Israel and the Palestinian Occupied Territories (these as a result of theft of aquifers by Israel) have clear problems of supply for their populations. Israel's occupation of the Golan Heights, belonging to Syria, was due to Israel's need for water and this is the reason why Israel still refuses even to talk to Syria about returning that territory.
And the exploitation of the waters of Lebanese rivers Wazzani and Hasbani by the Israelis was one of the reasons for prolonging the occupation of Southern Lebanon for 20 years, until they were forced to abandon the country after a long and heroic resistance by Hizbollah. However the Israelis still today prevent the Lebanese from fully enjoying the waters of those rivers (tributaries of the River Jordan flowing into Lake Tiberias) despite the water shortages in Southern Lebanon under the threat of Israeli military attack. The same reason serves to prolong the occupation of the Sheba'a farms, land in Southern Lebanon occupied by Israel since 1967. It happens that the Sheba'a Farms are located near Mount Hermon, an important reserve of subterranean water, and are very close to the rivers Hasbani and Wazzani.
Exactly that is one of the main reasons for the conflict in Lebanon and for US interest in that little country. There are no chance events in geopolitics and it is worth mentioning that the Israeli bombardment of Lebanon in 2006 coincided with the inauguration of the Baku-Tblisi-Ceyhan oil pipeline joining the Caspian Sea to the eastern Mediterranean(6). A project that will serve among other things to provide Israel with oil and which has been designed by the United States. The same as the pipeline project to bring water to Israel pumping from the higher sources of the river system of the Tigris and Euphrates, which rise in Turkey but run mostly through Iraq.
(1) Cyrus Vance, “Hard Choices: Critical Years in America’s Foreign Policy”, Simon & Schuster Books 1983.
(2) Alberto Cruz., “Breve manual de la política exterior de los EEUU” http://www.avizora.com/publicaciones/politica_y_economia_americanas/politica_y_economia%20americanas_18.htm
(3) Alberto Cruz, “Irak, la baza de EEUU para evitar el derrumbe del dólar” http://www.nodo50.org/ceprid/spip.php?article73
(5) Foreign Affairs, noviembre-diciembre 2006.
(6) Michel Chossudovsky, “The Lebanese war and the battle for oil” http://www.globalresearch.ca/index.php?context=va&aid=5841
This article was published in Number 32 of the review Pueblos for June 2008 coinciding with the celebration of the Alternative Oil Summit to the official one that took place in Madrid. Here, oil price data have been revised and a mention added of the Doha accord on Lebanon.
Alberto Cruz is a journalist, political analyst and writer specializing in international relations - firstname.lastname@example.org