Yes, the Iraq War was a war for oil, and it was a war with winners: ..... Big Oil.
It has been 10 years
since Operation Iraqi Freedom's bombs first landed in Baghdad. And while
most of the U.S.-led coalition forces have long since gone, Western oil
companies are only getting started.
Before the 2003 invasion,
Iraq's domestic oil industry was fully nationalized and closed to
Western oil companies. A decade of war later, it is largely privatized
and utterly dominated by foreign firms.
From ExxonMobil and Chevron to BP and Shell, the West's largest oil companies have set up shop in Iraq. So have a slew of American oil service companies, including Halliburton, the Texas-based firm Dick Cheney ran before becoming George W. Bush's running mate in 2000. The war is the one and only reason for this long sought and newly acquired access.
Oil was not the only goal
of the Iraq War, but it was certainly the central one, as top U.S.
military and political figures have attested to in the years following
the invasion.
"Of course it's about
oil; we can't really deny that," said Gen. John Abizaid, former head of
U.S. Central Command and Military Operations in Iraq, in 2007. Former
Federal Reserve Chairman Alan Greenspan agreed,
writing in his memoir, "I am saddened that it is politically
inconvenient to acknowledge what everyone knows: the Iraq war is largely
about oil." Then-Sen. and now Defense Secretary Chuck Hagel said the same in 2007: "People say we're not fighting for oil. Of course we are."
For the first time in
about 30 years, Western oil companies are exploring for and producing
oil in Iraq from some of the world's largest oil fields and reaping
enormous profit. And while the U.S. has also maintained
a fairly consistent level of Iraq oil imports since the invasion, the
benefits are not finding their way through Iraq's economy or society.
These outcomes were by design, the result of a decade of U.S. government and oil company pressure. In 1998, Kenneth Derr, then CEO of Chevron, said, "Iraq possesses huge reserves of oil and gas-reserves I'd love Chevron to have access to." Today it does.
In 2000, Big Oil,
including Exxon, Chevron, BP and Shell, spent more money to get fellow
oilmen Bush and Cheney into office than they had spent on any previous
election. Just over a week into Bush's first term, their efforts paid
off when the National Energy Policy Development Group, chaired by
Cheney, was formed, bringing the administration and the oil companies
together to plot our collective energy future. In March, the task force reviewed lists and maps outlining Iraq's entire oil productive capacity.
Planning for a military invasion was soon under way. Bush's first Treasury secretary, Paul O'Neill, said in 2004, "Already by February (2001), the talk was mostly about logistics. Not the why (to invade Iraq), but the how and how quickly."
In its final report in May 2001
(PDF), the task force argued that Middle Eastern countries should be
urged "to open up areas of their energy sectors to foreign investment."
This is precisely what has been achieved in Iraq. Here's how they did it.
The State Department Future of Iraq Project's Oil and Energy Working Group met from February 2002 to April 2003 and agreed that Iraq "should be opened to international oil companies as quickly as possible after the war."
The list of the group's
members was not made public, but Ibrahim Bahr al-Uloum -- who was
appointed Iraq's oil minister by the U.S. occupation government in
September 2003 -- was part of the group, according to Greg Muttitt, a
journalist and author of "Fuel on the Fire: Oil and Politics in Occupied Iraq." Bahr al-Uloum promptly set about trying to implement the group's objectives.
At the same time, representatives from ExxonMobil, Chevron, ConocoPhillips and Halliburton, among others, met with Cheney's staff
in January 2003 to discuss plans for Iraq's postwar industry. For the
next decade, former and current executives of western oil companies
acted first as administrators of Iraq's oil ministry and then as
"advisers" to the Iraqi government.
Before the invasion, there were just two things standing in the way of
Western oil companies operating in Iraq: Saddam Hussein and the nation's
legal system. The invasion dealt handily with Hussein. To address the
latter problem, some both inside and outside of the Bush administration
argued that it should simply change Iraq's oil laws through the U.S.-led
coalition government of Iraq, which ran the country from April 2003 to
June 2004. Instead the White House waited, choosing to pressure the
newly elected Iraqi government to pass new oil legislation itself.
This Iraq Hydrocarbons
Law, partially drafted by the Western oil industry, would lock the
nation into private foreign investment under the most corporate-friendly
terms. The Bush administration pushed the Iraqi government both
publicly and privately to pass the law. And in January 2007, as the
''surge" of 20,000 additional American troops was being finalized, the president set specific benchmarks
for the Iraqi government, including the passage of new oil legislation
to "promote investment, national unity, and reconciliation."
But due to enormous
public opposition and a recalcitrant parliament, the central Iraqi
government has failed to pass the Hydrocarbons Law. Usama al-Nujeyfi, a
member of the parliamentary energy committee, even quit in protest over the law, saying it would cede too much control to global companies and "ruin the country's future."
In 2008, with the
likelihood of the law's passage and the prospect of continued foreign
military occupation dimming as elections loomed in the U.S. and Iraq,
the oil companies settled on a different track.
Bypassing parliament,
the firms started signing contracts that provide all of the access and
most of the favorable treatment the Hydrocarbons Law would provide --
and the Bush administration helped draft the model contracts.
Upon leaving office,
Bush and Obama administration officials have even worked for oil
companies as advisers on their Iraq endeavors. For example, former U.S.
Ambassador to Iraq Zalmay Khalilzad's company, CMX-Gryphon, "provides international oil companies and multinationals with unparalleled access, insight and knowledge on Iraq."
The new contracts lack
the security a new legal structure would grant, and Iraqi lawmakers have
argued that they run contrary to existing law, which requires
government control, operation and ownership of Iraq's oil sector. But the contracts do
achieve the key goal of the Cheney energy task force: all but
privatizing the Iraqi oil sector and opening it to private foreign
companies.They also provide
exceptionally long contract terms and high ownership stakes and
eliminate requirements that Iraq's oil stay in Iraq, that companies
invest earnings in the local economy or hire a majority of local
workers.
Iraq's oil production has increased by more than 40% in the past five years to 3 million barrels of oil a day (still
below the 1979 high of 3.5 million set by Iraq's state-owned
companies), but a full 80% of this is being exported out of the country
while Iraqis struggle to meet basic energy consumption needs. GDP per
capita has increased significantly yet remains among the lowest in the
world and well below some of Iraq's other oil-rich neighbors. Basic
services such as water and electricity remain luxuries, while 25% of the population lives in poverty.
The promise of new
energy-related jobs across the country has yet to materialize. The oil
and gas sectors today account directly for less than 2% of total employment, as foreign companies rely instead on imported labor. In just the last few weeks, more than 1,000 people have protested at ExxonMobil and Russia Lukoil's super-giant West Qurna oil field, demanding jobs and payment for private land that has been lost or damaged by oil operations. The Iraqi military was called in to respond. Fed up with the firms, a leading coalition of Iraqi civil society groups and trade unions, including oil workers, declared on February 15
that international oil companies have "taken the place of foreign
troops in compromising Iraqi sovereignty" and should "set a timetable
for withdrawal."
Closer to home, at a
protest at Chevron's Houston headquarters in 2010, former U.S. Army
Military Intelligence officer Thomas Buonomo, member of Iraq Veterans
Against the War, held up a sign that read, "Dear Chevron: Thank you for dishonoring our service" (PDF).
Yes, the Iraq War was a
war for oil, and it was a war with losers: the Iraqi people and all
those who spilled and lost blood so that Big Oil could come out ahead.
