Richard Moore

To: "mer" <•••@••.•••>
From: "MER - Mid-East Realities - MiddleEast.Org" <•••@••.•••>
Subject: Oil, Power, Israel, and World Domination
Date: Sat, 10 Apr 2004 08:16:58 -0400

        10 April 2004


Raping the Middle East for its oil
By Robert Dreyfuss

Mother Jones -  March/April 2003:    

If you were to spin the globe and look for real estate critical to
building an American empire, your first stop would have to be the
Persian Gulf. The desert sands of this region hold two of every three
barrels of oil in the world -- Iraq's reserves alone are equal, by some
estimates, to those of Russia, the United States, China, and Mexico
combined. For the past 30 years, the Gulf has been in the crosshairs of
an influential group of Washington foreign-policy strategists, who
believe that in order to ensure its global dominance, the United States
must seize control of the region and its oil. Born during the energy
crisis of the 1970s and refined since then by a generation of
policymakers, this approach is finding its boldest expression yet in the
Bush administration -- which, with its plan to invade Iraq and install a
regime beholden to Washington, has moved closer than any of its
predecessors to transforming the Gulf into an American protectorate.

In the geopolitical vision driving current U.S. policy toward Iraq, the
key to national security is global hegemony -- dominance over any and
all potential rivals. To that end, the United States must not only be
able to project its military forces anywhere, at any time. It must also
control key resources, chief among them oil -- and especially Gulf oil.
To the hawks who now set the tone at the White House and the Pentagon,
the region is crucial not simply for its share of the U.S. oil supply
(other sources have become more important over the years), but because
it would allow the United States to maintain a lock on the world's
energy lifeline and potentially deny access to its global competitors.
The administration "believes you have to control resources in order to
have access to them," says Chas Freeman, who served as U.S. ambassador
to Saudi Arabia under the first President Bush. "They are taken with the
idea that the end of the Cold War left the United States able to impose
its will globally -- and that those who have the ability to shape events
with power have the duty to do so. It's ideology."

Iraq, in this view, is a strategic prize of unparalleled importance.
Unlike the oil beneath Alaska's frozen tundra, locked away in the
steppes of central Asia, or buried under stormy seas, Iraq's crude is
readily accessible and, at less than $1.50 a barrel, some of the
cheapest in the world to produce. Already, over the past several months,
Western companies have been meeting with Iraqi exiles to try to stake a
claim to that bonanza.

But while the companies hope to cash in on an American-controlled Iraq,
the push to remove Saddam Hussein hasn't been driven by oil executives,
many of whom are worried about the consequences of war. Nor are Vice
President Cheney and President Bush, both former oilmen, looking at the
Gulf simply for the profits that can be earned there. The administration
is thinking bigger, much bigger, than that.

"Controlling Iraq is about oil as power, rather than oil as fuel," says
Michael Klare, professor of peace and world security studies at
Hampshire College and author of Resource Wars. "Control over the Persian
Gulf translates into control over Europe, Japan, and China. It's having
our hand on the spigot."

Ever since the oil shocks of the 1970s, the United States has steadily
been accumulating military muscle in the Gulf by building bases, selling
weaponry, and forging military partnerships. Now, it is poised to
consolidate its might in a place that will be a fulcrum of the world's
balance of power for decades to come. At a stroke, by taking control of
Iraq, the Bush administration can solidify a long-running strategic
design. "It's the Kissinger plan," says James Akins, a former U.S.
diplomat. "I thought it had been killed, but it's back."

Akins learned a hard lesson about the politics of oil when he served as
a U.S. envoy in Kuwait and Iraq, and ultimately as ambassador to Saudi
Arabia during the oil crisis of 1973 and '74. At his home in Washington,
D.C., shelves filled with Middle Eastern pottery and other memorabilia
cover the walls, souvenirs of his years in the Foreign Service. Nearly
three decades later, he still gets worked up while recalling his first
encounter with the idea that the United States should be prepared to
occupy Arab oil-producing countries.

In 1975, while Akins was ambassador in Saudi Arabia, an article
headlined "Seizing Arab Oil" appeared in Harper's. The author, who used
the pseudonym Miles Ignotus, was identified as "a Washington-based
professor and defense consultant with intimate links to high-level U.S.
policymakers." The article outlined, as Akins puts it, "how we could
solve all our economic and political problems by taking over the Arab
oil fields [and] bringing in Texans and Oklahomans to operate them."
Simultaneously, a rash of similar stories appeared in other magazines
and newspapers. "I knew that it had to have been the result of a deep
background briefing," Akins says. "You don't have eight people coming up
with the same screwy idea at the same time, independently.

"Then I made a fatal mistake," Akins continues. "I said on television
that anyone who would propose that is either a madman, a criminal, or an
agent of the Soviet Union." Soon afterward, he says, he learned that the
background briefing had been conducted by his boss, then-Secretary of
State Henry Kissinger. Akins was fired later that year.

Kissinger has never acknowledged having planted the seeds for the
article. But in an interview with Business Week that same year, he
delivered a thinly veiled threat to the Saudis, musing about bringing
oil prices down through "massive political warfare against countries
like Saudi Arabia and Iran to make them risk their political stability
and maybe their security if they did not cooperate."

In the 1970s, America's military presence in the Gulf was virtually nil,
so the idea of seizing control of its oil was a pipe dream. Still,
starting with the Miles Ignotus article, and a parallel one by
conservative strategist and Johns Hopkins University professor Robert W.
Tucker in Commentary, the idea began to gain favor among a feisty group
of hardline, pro-Israeli thinkers, especially the hawkish circle aligned
with Democratic senators Henry Jackson of Washington and Daniel Patrick
Moynihan of New York.

Eventually, this amalgam of strategists came to be known as
"neoconservatives," and they played important roles in President
Reagan's Defense Department and at think tanks and academic policy
centers in the 1980s. Led by Richard Perle, chairman of the Pentagon's
influential Defense Policy Board, and Deputy Secretary of Defense Paul
Wolfowitz, they now occupy several dozen key posts in the White House,
the Pentagon, and the State Department. At the top, they are closest to
Vice President Cheney and Defense Secretary Donald Rumsfeld, who have
been closely aligned since both men served in the White House under
President Ford in the mid-1970s. They also clustered around Cheney when
he served as secretary of defense during the Gulf War in 1991.

Throughout those years, and especially after the Gulf War, U.S. forces
have steadily encroached on the Gulf and the surrounding region, from
the Horn of Africa to Central Asia. In preparing for an invasion and
occupation of Iraq, the administration has been building on the steps
taken by military and policy planners over the past quarter century.

Step one: The Rapid Deployment Force In 1973 and '74, and again in 1979,
political upheavals in the Middle East led to huge spikes in oil prices,
which rose fifteenfold over the decade and focused new attention on the
Persian Gulf. In January 1980, President Carter effectively declared the
Gulf a zone of U.S. influence, especially against encroachment from the
Soviet Union. "Let our position be absolutely clear," he said,
announcing what came to be known as the Carter Doctrine. "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." To back up this doctrine, Carter created the
Rapid Deployment Force, an "over-the-horizon" military unit capable of
rushing several thousand U.S. troops to the Gulf in a crisis.

Step two: The Central Command In the 1980s, under President Reagan, the
United States began pressing countries in the Gulf for access to bases
and support facilities. The Rapid Deployment Force was transformed into
the Central Command, a new U.S. military command authority with
responsibility for the Gulf and the surrounding region from eastern
Africa to Afghanistan. Reagan tried to organize a "strategic consensus"
of anti-Soviet allies, including Turkey, Israel, and Saudi Arabia. The
United States sold billions of dollars' worth of arms to the Saudis in
the early '80s, from AWACS surveillance aircraft to F-15 fighters. And
in 1987, at the height of the war between Iraq and Iran, the U.S. Navy
created the Joint Task Force-Middle East to protect oil tankers plying
the waters of the Gulf, thus expanding a U.S. naval presence of just
three or four warships into a flotilla of 40-plus aircraft carriers,
battleships, and cruisers.

Step three: The Gulf War Until 1991, the United States was unable to
persuade the Arab Gulf states to allow a permanent American presence on
their soil. Meanwhile, Saudi Arabia, while maintaining its close
relationship with the United States, began to diversify its commercial
and military ties; by the time U.S. Ambassador Chas Freeman arrived
there in the late 1980s, the United States had fallen to fourth place
among arms suppliers to the kingdom. "The United States was being
supplanted even in commercial terms by the British, the French, even the
Chinese," Freeman notes.

All that changed with the Gulf War. Saudi Arabia and other Gulf states
no longer opposed a direct U.S. military presence, and American troops,
construction squads, arms salesmen, and military assistance teams rushed
in. "The Gulf War put Saudi Arabia back on the map and revived a
relationship that had been severely attrited," says Freeman.

In the decade after the war, the United States sold more than $43
billion worth of weapons, equipment, and military construction projects
to Saudi Arabia, and $16 billion more to Kuwait, Qatar, Bahrain, and the
United Arab Emirates, according to data compiled by the Federation of
American Scientists. Before Operation Desert Storm, the U.S. military
enjoyed the right to stockpile, or "pre-position," military supplies
only in the comparatively remote Gulf state of Oman on the Indian Ocean.
After the war, nearly every country in the region began conducting joint
military exercises, hosting U.S. naval units and Air Force squadrons,
and granting the United States pre-positioning rights. "Our military
presence in the Middle East has increased dramatically," then-Defense
Secretary William Cohen boasted in 1995.

Another boost to the U.S. presence was the unilateral imposition, in
1991, of no-fly zones in northern and southern Iraq, enforced mostly by
U.S. aircraft from bases in Turkey and Saudi Arabia. "There was a
massive buildup, especially around Incirlik in Turkey, to police the
northern no-fly zone, and around [the Saudi capital of] Riyadh, to
police the southern no-fly zone," says Colin Robinson of the Center for
Defense Information, a Washington think tank. A billion-dollar,
high-tech command center was built by Saudi Arabia near Riyadh, and over
the past two years the United States has secretly been completing
another one in Qatar. The Saudi facilities "were built with capacities
far beyond the ability of Saudi Arabia to use them," Robinson says. "And
that's exactly what Qatar is doing now."

Step four: Afghanistan The war in Afghanistan -- and the open-ended war
on terrorism, which has led to U.S strikes in Yemen, Pakistan, and
elsewhere -- further boosted America's strength in the region. The
administration has won large increases in the defense budget -- which
now stands at about $400 billion, up from just over $300 billion in 2000
-- and a huge chunk of that budget, perhaps as much as $60 billion, is
slated to support U.S. forces in and around the Persian Gulf. Military
facilities on the perimeter of the Gulf, from Djibouti in the Horn of
Africa to the island of Diego Garcia in the Indian Ocean, have been
expanded, and a web of bases and training missions has extended the U.S.
presence deep into central Asia. From Afghanistan to the landlocked
former Soviet republics of Uzbekistan and Kyrgyzstan, U.S. forces have
established themselves in an area that had long been in Russia's sphere
of influence. Oil-rich in its own right, and strategically vital,
central Asia is now the eastern link in a nearly continuous chain of
U.S. bases, facilities, and allies stretching from the Mediterranean and
the Red Sea far into the Asian hinterland.

Step five: Iraq Removing Saddam Hussein could be the final piece of the
puzzle, cementing an American imperial presence. It is "highly possible"
that the United States will maintain military bases in Iraq, Robert
Kagan, a leading neoconservative strategist, recently told the Atlanta
Journal-Constitution. "We will probably need a major concentration of
forces in the Middle East over a long period of time," he said. "When we
have economic problems, it's been caused by disruptions in our oil
supply. If we have a force in Iraq, there will be no disruption in oil

Kagan, along with William Kristol of the Weekly Standard, is a founder
of the think tank Project for the New American Century, an assembly of
foreign-policy hawks whose supporters include the Pentagon's Perle, New
Republic publisher Martin Peretz, and former Central Intelligence Agency
director James Woolsey. Among the group's affiliates in the Bush
administration are Cheney, Rumsfeld, and Wolfowitz; I. Lewis Libby, the
vice president's chief of staff; Elliott Abrams, the Middle East
director at the National Security Council; and Zalmay Khalilzad, the
White House liaison to the Iraqi opposition groups. Kagan's group, tied
to a web of similar neoconservative, pro-Israeli organizations,
represents the constellation of thinkers whose ideological affinity was
forged in the Nixon and Ford administrations.

To Akins, who has just returned from Saudi Arabia, it's a team that
looks all too familiar, seeking to implement the plan first outlined
back in 1975. "It'll be easier once we have Iraq," he says. "Kuwait, we
already have. Qatar and Bahrain, too. So it's only Saudi Arabia we're
talking about, and the United Arab Emirates falls into place."

LAST SUMMER, Perle provided a brief glimpse into his circle's thinking
when he invited rand Corporation strategist Laurent Murawiec to make a
presentation to his Defense Policy Board, a committee of former senior
officials and generals that advises the Pentagon on big-picture policy
ideas. Murawiec's closed-door briefing provoked a storm of criticism
when it was leaked to the media; he described Saudi Arabia as the
"kernel of evil," suggested that the Saudi royal family should be
replaced or overthrown, and raised the idea of a U.S. occupation of
Saudi oil fields. He ultimately lost his job when rand decided he was
too controversial.

Murawiec is part of a Washington school of thought that views virtually
all of the nations in the Gulf as unstable "failed states" and maintains
that only the United States has the power to forcibly reorganize and
rebuild them. In this view, the arms systems and bases that were put in
place to defend the region also provide a ready-made infrastructure for
taking over countries and their oil fields in the event of a crisis.

The Defense Department likely has contingency plans to occupy Saudi
Arabia, says Robert E. Ebel, director of the energy program at the
Center for Strategic and International Studies (CSIS), a Washington
think tank whose advisers include Kissinger; former Defense Secretary
and CIA director James Schlesinger; and Zbigniew Brzezinski, Carter's
national security adviser. "If something happens in Saudi Arabia," Ebel
says, "if the ruling family is ousted, if they decide to shut off the
oil supply, we have to go in."

Two years ago, Ebel, a former mid-level CIA official, oversaw a CSIS
task force that included several members of Congress as well as
representatives from industry including ExxonMobil, Arco, BP, Shell,
Texaco, and the American Petroleum Institute. Its report, "The
Geopolitics of Energy Into the 21st Century," concluded that the world
will find itself dependent for many years on unstable oil-producing
nations, around which conflicts and wars are bound to swirl. "Oil is
high-profile stuff," Ebel says. "Oil fuels military power, national
treasuries, and international politics. It is no longer a commodity to
be bought and sold within the confines of traditional energy supply and
demand balances. Rather, it has been transformed into a determinant of
well-being, of national security, and of international power."

As vital as the Persian Gulf is now, its strategic importance is likely
to grow exponentially in the next 20 years. Nearly one out of every
three barrels of oil reserves in the world lie under just two countries:
Saudi Arabia (with 259 billion barrels of proven reserves) and Iraq (112
billion). Those figures may understate Iraq's largely unexplored
reserves, which according to U.S. government estimates may hold as many
as 432 billion barrels.

With supplies in many other regions, especially the United States and
the North Sea, nearly exhausted, oil from Saudi Arabia and Iraq is
becoming ever more critical -- a fact duly noted in the administration's
National Energy Policy, released in 2001 by a White House task force. By
2020, the Gulf will supply between 54 percent and 67 percent of the
world's crude, the document said, making the region "vital to U.S.
interests." According to G. Daniel Butler, an oil-markets analyst at the
U.S. Energy Information Administration (EIA), Saudi Arabia's production
capacity will rise from its current 9.4 million barrels a day to 22.1
million over the next 17 years. Iraq, which in 2002 produced a mere 2
million barrels a day, "could easily be a double-digit producer by
2020," says Butler.

U.S. strategists aren't worried primarily about America's own oil
supplies; for decades, the United States has worked to diversify its
sources of oil, with Venezuela, Nigeria, Mexico, and other countries
growing in importance. But for Western Europe and Japan, as well as the
developing industrial powers of eastern Asia, the Gulf is all-important.
Whoever controls it will maintain crucial global leverage for decades to

Today, notes the EIA's Butler, two-thirds of Gulf oil goes to Western
industrial nations. By 2015, according to a study by the CIA's National
Intelligence Council, three-quarters of the Gulf's oil will go to Asia,
chiefly to China. China's growing dependence on the Gulf could cause it
to develop closer military and political ties with countries such as
Iran and Iraq, according to the report produced by Ebel's CSIS task
force. "They have different political interests in the Gulf than we do,"
Ebel says. "Is it to our advantage to have another competitor for oil in
the Persian Gulf?"

David Long, who served as a U.S. diplomat in Saudi Arabia and as chief
of the Near East division in the State Department's Bureau of
Intelligence and Research during the Reagan administration, likens the
Bush administration's approach to the philosophy of Admiral Mahan, the
19th-century military strategist who advocated the use of naval power to
create a global American empire. "They want to be the world's enforcer,"
he says. "It's a worldview, a geopolitical position. They say, 'We need
hegemony in the region.'"

UNTIL THE 1970s, the face of American power in the Gulf was the U.S. oil
industry, led by Exxon, Mobil, Chevron, Texaco, and Gulf, all of whom
competed fiercely with Britain's BP and Anglo-Dutch Shell. But in the
early '70s, Iraq, Saudi Arabia, and the other Gulf states nationalized
their oil industries, setting up state-run companies to run wells,
pipelines, and production facilities. Not only did that enhance the
power of opec, enabling that organization to force a series of sharp
price increases, but it alarmed U.S. policymakers.

Today, a growing number of Washington strategists are advocating a
direct U.S. challenge to state-owned petroleum industries in
oil-producing countries, especially the Persian Gulf. Think tanks such
as the American Enterprise Institute, the Heritage Foundation, and CSIS
are conducting discussions about privatizing Iraq's oil industry. Some
of them have put forward detailed plans outlining how Iraq, Saudi
Arabia, and other nations could be forced to open up their oil and gas
industries to foreign investment. The Bush administration itself has
been careful not to say much about what might happen to Iraq's oil. But
State Department officials have had preliminary talks about the oil
industry with Iraqi exiles, and there have been reports that the U.S.
military wants to use at least part of the country's oil revenue to pay
for the cost of military occupation.

"One of the major problems with the Persian Gulf is that the means of
production are in the hands of the state," Rob Sobhani, an oil-industry
consultant, told an American Enterprise Institute conference last fall
in Washington. Already, he noted, several U.S. oil companies are
studying the possibility of privatization in the Gulf. Dismantling
government-owned oil companies, Sobhani argued, could also force
political changes in the region. "The beginning of liberal democracy can
be achieved if you take the means of production out of the hands of the
state," he said, acknowledging that Arabs would resist that idea. "It's
going to take a lot of selling, a lot of marketing," he concluded.

Just which companies would get to claim Iraq's oil has been a subject of
much debate. After a war, the contracts that Iraq's state-owned oil
company has signed with European, Russian, and Chinese oil firms might
well be abrogated, leaving the field to U.S. oil companies. "What they
have in mind is denationalization, and then parceling Iraqi oil out to
American oil companies," says Akins. "The American oil companies are
going to be the main beneficiaries of this war."

The would-be rulers of a post-Saddam Iraq have been thinking along the
same lines. "American oil companies will have a big shot at Iraqi oil,"
says Ahmad Chalabi, leader of the Iraqi National Congress, a group of
aristocrats and wealthy Iraqis who fled the country when its repressive
monarchy was overthrown in 1958. During a visit to Washington last fall,
Chalabi held meetings with at least three major U.S. oil companies,
trying to enlist their support. Similar meetings between Iraqi exiles
and U.S. companies have also been taking place in Europe.

"Iraqi exiles have approached us, saying, 'You can have our oil if we
can get back in there,'" says R. Gerald Bailey, who headed Exxon's
Middle East operations until 1997. "All the major American companies
have met with them in Paris, London, Brussels, all over. They're all
jockeying for position. You can't ignore it, but you've got to do it on
the QT. And you can't wait till it gets too far along."

But the companies are also anxious about the consequences of war,
according to many experts, oil-company executives, and former State
Department officials. "The oil companies are caught in the middle," says
Bailey. Executives fear that war could create havoc in the region,
turning Arab states against the United States and Western oil companies.
On the other hand, should a U.S. invasion of Iraq be successful, they
want to be there when the oil is divvied up. Says David Long, the former
U.S. diplomat, "It's greed versus fear."

Ibrahim Oweiss, a Middle East specialist at Georgetown University who
coined the term "petrodollar" and has also been a consultant to
Occidental and BP, has been closely watching the cautious maneuvering by
the companies. "I know that the oil companies are scared about the
outcome of this," he says. "They are not at all sure this is in the best
interests of the oil industry."

Anne Joyce, an editor at the Washington-based Middle East Policy Council
who has spoken privately to top Exxon officials, says it's clear that
most oil-industry executives "are afraid" of what a war in the Persian
Gulf could mean in the long term -- especially if tensions in the region
spiral out of control. "They see it as much too risky, and they are risk
averse," she says. "They think it has 'fiasco' written all over it."  
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