The failed mission to capture Iraqi
oil By Michael T Klare
It has long been an article of faith among
America's senior policymakers - Democrats and
Republicans alike - that military force is an
effective tool for ensuring control over foreign
sources of oil. Franklin D Roosevelt was the first
president to embrace this view, in February 1945,
when he promised King Abdul Aziz of Saudi Arabia
that the United States would establish a military
protectorate over his country in return for
privileged access to Saudi oil - a promise that
continues to govern US policy today. Every
president since Roosevelt has endorsed this basic
proposition, and has contributed in one way or
another to the buildup of American military power
in the greater Persian Gulf region.
American presidents have never hesitated
to use this power when deemed necessary to protect
US oil interests in the Gulf. When, following the
Iraqi invasion of Kuwait, President Bush Senior
sent
hundreds of
thousands of US troops to Saudi Arabia in August
1990, he did so with absolute confidence that the
application of American military power would
eventually result in the safe delivery of
ever-increasing quantities of Middle Eastern oil
to the US. This presumption was clearly a critical
factor in the younger Bush's decision to invade
Iraq in March 2003.
Now, more than two
years after that invasion, the growing Iraqi
quagmire has demonstrated that the application of
military force can have the very opposite effect:
It can diminish - rather than enhance - America's
access to foreign oil.
An occupation
floating on a sea of oil Oil was certainly
not the only concern that prompted the American
invasion of Iraq, but it weighed in heavily with
many senior administration officials. This was
especially true of Vice President Dick Cheney who,
in an August 2002 speech to the Veterans of
Foreign Wars, highlighted the need to retain
control over Persian Gulf oil supplies when
listing various reasons for toppling Saddam
Hussein.
Nor is there any doubt that
Cheney's former colleagues in the oil industry
viewed Iraq's oilfields with covetous eyes. "For
any oil company," one oil executive told the New
York Times in February 2003, "being in Iraq is
like being a kid in FAO Schwarz." Likewise, oil
was a factor in the pre-war thinking of many key
neo-conservatives who argued that Iraqi oilfields
- once under US control would cripple the
Organization of Petroleum Exporting Countries and
thereby weaken the Arab states facing Israel.
Still, for some US policymakers, other
factors were preeminent, especially the urge to
demonstrate the efficacy of the Bush Doctrine, the
precept that preventive war is a practical and
legitimate response to possible
weapons-of-mass-destruction ambitions on the part
of potential adversaries. Whatever the primacy of
their ultimate objectives, these leaders shared
one basic assumption: that, when occupied by
American forces, Iraq would pump ever increasing
amounts of petroleum from its vast and prolific
reserves.
This sense of optimism about
Iraq's future oil output was palpable in
Washington in the months leading up to the
invasion. In its periodic reports on Iraqi
petroleum, the Department of Energy (DoE), for
example, confidently reported in late 2002 that,
with sufficient outside investment, Iraq could
quickly double its production from the then-daily
level of 2.5 million barrels to 5 million barrels
or more.
At the State Department, the
Future of Iraq Project set up a Working Group on
Oil and Energy to plan the privatization of Iraqi
oil assets and the rapid introduction of Western
capital and expertise into the local industry.
Meanwhile, Iraqi exile Ahmed Chalabi - then the
Pentagon's favored candidate to replace Saddam
Hussein as suzerain of Iraq (and now Iraq's deputy
prime minister in charge of energy
infrastructure)- met with top executives of the
major US oil companies and promised them a
significant role in developing Iraq's vast
petroleum reserves. "American companies will have
a big shot at Iraqi oil," he insisted in September
2002.
Aside from the purely pecuniary
benefits of seizing Iraqi oil, administration
officials of all persuasions saw another key
attraction: once Iraqi fields were pumping oil
again, the resulting revenues would essentially
pay for the war and the costs of occupation. "We
can afford it," White House economic adviser Larry
Lindsey said of the planned US invasion, because
rising Iraqi oil output would invigorate the US
economy.
"When there is regime change in
Iraq, you could add 3 to 5 million barrels [per
day] of production to world supply," he told the
Wall Street Journal in September 2002. Hence,
"Successful prosecution of the war would be good
for the economy." In one of the most striking
comments of this sort, then deputy secretary of
defense Paul Wolfowitz told a congressional panel,
"The oil revenue of [Iraq] could bring between $50
billion and $100 billion over the course of the
next two or three years. We're dealing with a
country that could really finance its own
reconstruction, and relatively soon."
Clearly, gaining control of what Wolfowitz
once described as a country that "floats on a sea
of oil" was one of the Pentagon's highest
priorities in the early days of the invasion. As
part of its planning for the assault, the
Department of Defense established detailed plans
to seize Iraqi oil fields and installations during
the first days of the war.
"It's fair to
say that our land component commander and his
planning staff have crafted strategies that will
allow us to secure and protect these fields as
rapidly as possible," a top Pentagon official told
the media on January 24, 2003. Once US troops
entered Iraq, special combat teams spread out into
the oil fields and occupied key installations. In
fact, the very first operation of the war was a
commando raid on an offshore loading platform in
the Persian Gulf. "Swooping silently out of the
Persian Gulf night," an over-stimulated reporter
for the New York Times wrote on March 23, "Navy
Seals seized two Iraqi oil terminals in bold raids
that ended early this morning, overwhelming
lightly armed Iraqi guards and claiming a
bloodless victory in the battle for Iraq's vast
oil empire."
This early "victory" was
followed by others, as US forces occupied key
refineries and, most conspicuously, the Oil
Ministry building in downtown Baghdad. So far, so
good. But almost instantaneously things began to
go seriously wrong.
Lacking sufficient
troops to protect the oil facilities and all the
other infrastructure in Baghdad and other key
cities, the military chose to protect the oil
alone - allowing desperate and rapacious Iraqis to
go on a rampage of looting that fatally undermined
the authority of the military occupation and the
US-backed interim government.
To make
matters worse, the very visible American emphasis
on protecting oil facilities while ignoring other
infrastructure gave the distinct - and not
completely inaccurate -impression that the US had
invaded Iraq less to liberate it from a tyrannical
regime than to steal, or at least control, its
oil. And from this perception came part of the
anger and resentment that constituted the
essential raw materials for the outbreak of an
armed insurgency against the American occupation
and everything associated with it. The Bush
administration never recovered from this
disastrous chain of events.
An
occupation engulfed in a sea of fire The
Iraqi insurgency is not monolithic, and it is not
always possible to determine the intentions of its
various components. Nevertheless, it is clear that
oil - that is, the association between Iraqi oil
and the American occupation - plays a central role
in the insurgents' hazy ideology. "The insurgents
used this," Iraqi-born oil consultant Falah
Alijbury said of American plans to privatize the
Iraqi oil industry. As he put it, the insurgents
are telling fellow Iraqis, "Look, you're losing
your country, you're losing your resources to a
bunch of wealthy billionaires who want to take you
over and make your life miserable." From
Alijbury's perspective, this is one of the
insurgency's most powerful appeals.
The
disparate Iraqi insurgent groups were also aware
of Washington's intent to finance its war and
occupation through sales of Iraqi petroleum, and
so have made sabotage of Iraq's pipelines, pumping
stations, and loading terminals one of their most
important strategic objectives. According to one
source, insurgents conducted 230 major attacks on
Iraq's oil infrastructure between January 2004 and
September 7, 2005, causing billions of dollars in
losses. Here, for instance, is a listing of some
of the most recent attacks, as compiled by the
Institute for the Analysis of Global Security:
August 20: Attack on a major pipeline between
Bayji and Baghdad stopped electricity to the
capital.
August 26: Insurgents sabotaged an exporting
oil well north of Kirkuk.
August 27: Bomb beneath an oil pipeline
supplying the Daura oil refinery in Baghdad,
causing an hour-long fire.
August 29: Rebels fired a mortar at Iraq's oil
ministry building in Baghdad.
August 30: Lieutenant Colonel Mohammed Rashad,
commander of a unit protecting Iraq's oil pipeline
network, was assassinated in front of his home in
Kirkuk as he was leaving for work.
September 3: An explosion on oil pipeline 2.5
miles from Fatha, between Kirkuk and Bayji,
stopping oil flow from Kirkuk to Ceyhan after
insurgents ignited an oil leak.
September 5: Oil pipeline connecting Bayji and
Baghdad was set on fine west of Samarra.
As a result of such attacks, which
continue to occur on a near-daily basis, Iraqi oil
output has actually declined since the US invaded
Iraq and overthrew Saddam. According to the DoE,
total production stood at 1.9 million barrels per
day in May this year, compared to 2.6 million
barrels in January 2003, just before the American
invasion. Quite the opposite of paying for the
American occupation, as promised by administration
officials, Iraqi production is costing US
taxpayers billions of dollars per year.
Underwriting the costs of using American soldiers
and US-paid private guards to protect Iraq's
highly vulnerable pipelines and refineries has
proved expensive indeed.
At present,
American forces are protecting two main components
of Iraq's oil infrastructure: the Kirkuk-to-Ceyhan
export pipeline in the north, near Iraq's border
with Turkey; and offshore loading terminals in the
south, on the edge of the Persian Gulf. Protection
of the northern pipeline is the responsibility of
Task Force Shield, a mobile combat unit made up of
army forces drawn from Fort Wainright, Alaska and
Fort Lewis in Washington State. In the Gulf,
protection of the loading platforms is the
responsibility of the US Navy and the Coast Guard.
These oil-protection operations have
proved extremely hazardous. In April 2004, for
example, suicide bombers in a small boat
approached the Khor al-Amaya offshore loading
terminal and detonated their explosives when
approached by a US patrol ship, killing two navy
sailors and one Coast Guard sailor - the latter
being the first Coast Guardsman to be killed in
combat since the Vietnam War. Adding further
symbolism to this event, the platform involved was
one of those occupied by Navy Seals in March 2003
in that "bloodless victory in the battle for
Iraq's vast oil empire".
Despite the
deployment of American troops at key oil
facilities and the ever-rising amounts of money
invested in pipeline security, the Department of
Defense has made zero progress in its drive to
boost Iraqi oil output. "In the north, Iraq's main
export pipeline looks all but impossible to
protect from sabotage," the British Financial
Times reported in June. "Meanwhile, in the south,
local tribal disputes, which often go unreported,
hamper efforts to restore oilfields, while
security costs and other reconstruction bills all
reduce the amount of money available for [the
rehabilitation of] the oil industry."
Efforts to boost Iraqi oil production have
also been hampered by two other problems:
pervasive corruption in the Oil Ministry and
severe differences between the Kurds, the Sunnis
and the Shi'ites over the future allocation of oil
revenues.
Just how much Iraqi oil has been
lost to corruption or black-market transactions is
impossible to determine, but experts believe the
amounts are substantial. "Administrative
corruption takes on so many forms," Muhammad
al-Abudi, the Oil Ministry's director-general of
drilling, observed in March 2005.
"The
robberies and thefts that are taking place on a
daily basis and on all levels ... are committed by
low-level government employees and also by high
officials in leadership positions in the Iraqi
state," he noted. Typically, these losses are
blamed on insurgent activity, thereby diverting
attention from the government figures actually
responsible. "It seems there that there is an
implicit alliance between the smuggling and
sabotage forces aimed at increasing the rates of
exhaustion of the state resources," Diya al-Bakka,
another senior Oil Ministry official told Oil
& Gas Journal in May.
The corruption
and mismanagement has had another serious
consequence for Iraq's long-term oil potential: in
order to maximize output now, and thereby keep the
dollars rolling in, Iraqi oil executives are
employing faulty pumping methods, thus risking
permanent damage to underground reservoirs. For
example, managers are continuing to pump oil from
Iraq's main Rumailia oilfield, one of the world's
largest, even though water injection systems (used
to maintain underground pressure) have failed; in
so doing, they are thought by experts to be
causing irreversible damage to the field. "The
problem is that [underground] pressure problems
could lead to a permanent decline in production,"
observed one European buyer of Iraqi oil quoted in
the Financial Times last June. Even if US
companies later were to gain access to Iraqi
fields, therefore, they might find yields to be
disappointing.
Just as significant is the
warring between Iraq's three main ethnic and
religious communities over the distribution of
future oil royalties. Most of Iraq's large
oilfields are concentrated in the Kurdish north
and the Shi'ite south. The Kurds and Shi'ites want
most of the royalties to be distributed to Iraq's
provinces on a per capita basis, which would
benefit them, but leave funds relatively scarce
for the Sunni region and for any future central
government in Baghdad.
A failure to reach
agreement on this issue was one of the main
obstacles to final adoption of the new Iraqi
constitution, and helped prompt the Sunni
delegates to reject the final text. The Sunnis are
also worried by provisions of the proposed
constitution that allow groups of provinces
(presumably in the Kurdish and Shi'ite areas) to
form self-governing regional entities which could
lead to the breakup of Iraq into three
semi-independent statelets, with the Sunnis
occupying the smallest and poorest region in the
center.
Not only would such a breakup
enhance the Sunnis' sense of alienation from the
Iraqi nation-building project - thereby further
invigorating an already vigorous insurgency - but
it would also disrupt Iraqi oil operations and
make investment in Iraq's petroleum industry even
less attractive to foreign oil companies. The net
result, in all likelihood, will be a further
decline in Iraqi petroleum output.
The
oil evaporates From all that can be seen,
oil production in Iraq is likely to remain
depressed for years, no matter how much more blood
is shed in its pursuit. It is already evident that
American military action will not lead to
democracy in Iraq, merely to the division of the
country into separate ethnic enclaves, one
possibly ruled by Iranian-like ayatollahs; it can
now also be said that we will not gain any
additional petroleum supplies as a result of all
this sacrifice and tragedy. Not only has the use
of force to procure Iraqi oil failed to achieve
its intended results, it has actually made the
situation worse.
This is an important
conclusion to draw from Iraq as the US becomes
ever more dependent on imported petroleum. Even
before Katrina struck a blow to the US's domestic
oil industry, the Department of Energy was already
projecting reliance on imports to grow from about
53% of total consumption in 2002 to 66% by 2025.
As a result of the hurricane, that
percentage will in all likelihood be pushed much
higher because most of the growth in domestic
petroleum output was expected to occur in the deep
waters of the Gulf of Mexico - the area most
heavily affected by Katrina and its 2004
predecessor Ivan. A number of the drilling
platforms in these waters were sunk by the storms,
which also played havoc with the pipelines
connecting them to shore.
True, many of
the platforms that survived will be repaired and
put back into operation, but insurance rates have
skyrocketed; and investors may prove hesitant,
even with oil prices soaring, to put up billions
of dollars to install new platforms that will only
be washed away in the next major hurricane. As a
result, domestic US output may fall well below DoE
projections, and so more of our supply will have
to be imported.
And there is no question
where this additional oil will have to be
procured: in the Middle East, Central Asia,
Africa, the Andes and other areas beset by chronic
instability and conflict. These are the only areas
capable of increasing oil output sufficiently to
satisfy rising US demand, and so these are the
areas that will attract the greatest American
attention and potential Pentagon involvement.
If past experience is any indication, US
policymakers will respond to the dilemma of our
growing dependence on unstable foreign providers
by sending more and more American military forces
to these areas in a desperate attempt to ensure
uninterrupted access to oil. This is, in fact, the
underlying reason for the Pentagon's search for
new military bases in Central Asia, the Persian
Gulf and Africa.
Despite the debacle of
Iraq, most senior policymakers appear to retain
their blind faith in the efficacy of military
force as a tool for securing access to foreign
sources of petroleum. This, as Iraq makes
painfully clear, is delusional. Yet they persist
in risking the lives of young Americans and others
in their continued adherence to a failed and
immoral strategy. Any attempt to reconstruct
American foreign policy on a more rational and
ethical basis must, therefore, begin with the
repudiation of the use of force in procuring
foreign oil and the adoption of a forward-looking
energy strategy based on increased conservation
and the rapid development of alternative fuels.
Michael T Klare is the Professor
of Peace and World Security Studies at Hampshire
College and the author, most recently, of
Blood and Oil: The Dangers and Consequences of
America's Growing Dependence on Imported Petroleum
(Owl Books) as well as Resource Wars, The
New Landscape of Global Conflict.
