Thursday, July 29, 2010

Timtraveler responds to Victor Davis Hanson

Military historian and conservative think tank scholar Victor Davis Hanson was interviewed today on KQED radio's "Forum" program. Hanson refutes the "left's" claim that the War in Iraq was fought for oil. I responded with the following commentary:
Mr. Hanson stated "we have to look at the proof of the pudding...after we went in there, we had an open transparent auction and guess what: the Chinese, some European companies and the Russians bid and were accepted and they're in there now and no U.S. company is. I can't think of any so-called imperialistic venture that was intended to get oil...would then get no oil and allow all of its rivals to bid and get the concessions after we did all the heavy lifting..."

This is inaccurate, misleading and disingenuous. It may however serve Mr. Hanson's agenda. In a recent auction for oil field development in the south, it is true that American companies did not get contracts. That is because they did not even bid. But this concern about "American" companies is a straw man.

Development of oil fields is only one facet of the oil supply chain. The "winning" international bidders will receive per-barrel profits from the Iraqi state. There are still many fields to develop, many auctions yet to be run. If you are concerned about American companies, rest assured that Exxon-Mobil and Chevron are heavily involved in negotiations with the Iraqi government. Halliburton and other oil field services companies are profiting handsomely from operations in Iraq.

The United States is currently the largest importer of Iraqi oil. Expanding Iraqi oil production benefits the U.S., regardless who develops the fields. We will buy the oil whether the Russians, Chinese, Dutch or Indonesians "do the heavy lifting". Plentiful supply helps moderate the global oil market.

It would be naive to think that the United States does not have substantial influence in the Iraqi state-run auctions, which accept or reject bids and set the price oil field developers will be paid.

The more critical question is "who controls and manages the petroleum marketplace in Iraq?" You can be sure the U.S. government and the global (not just American) oil companies it depends upon are well-represented at the table. The wars are about controlling oil and establishing a powerful military presence in the midst of this volatile and resource-rich region. Cloaking this campaign in "freedom and democracy" just makes it more palatable to the American people.

1 comment:

Anonymous said...

I don't think we went into Iraq for anything as rational as oil. They thought it would be a quick, easy win like Afghanistan had been (see Tom Rick's, 'Fiasco') which would send a message that You're Next if you mess with America. Of course, one strategic error (of many) is that Jihadists can operate as effectively without states as with, perhaps more so. We'll have to await the final outcome of the Iraq concessions for any proofs in that, but keep in mind that oil is preferably bought from stable authoritarian producers and Iraq's oil was already in the world pool via sales to France and Russia. Today almost all the oil anywhere is owned by nation states. The Iraqi oil ministry is a much bigger player than ExxonMobil or any of our guys and at the end of the day Iraq doesn't owe us anything. See also Dan Yergin's 'The Prize.' Oil is complicated. But a good piece of your part.