The Price Of Oil

Posted on Tuesday, July 06 at 10:00 by Reverend Blair

After the war the victors divvied up the spoils, creating countries and installing friendly rulers to keep the oil flowing to Europe and North America. Mesopotamian oil had become so important that British Foreign Secretary Arthur Balfour said to the gathered Prime Ministers of the British Dominions, "I do not care under what system we keep the oil, but I am quite clear it is all-important for us that this oil should be available." Oil had become a strategic resource and control over it was now imperative to be a world power.

In the period between the First World War and the Second World War, politics were played and deals were struck. The resources under Iraq were proven by the British. The western world moved into the Middle East in search of control of black gold and, while there were winners and losers, the inhabitants of the newly formed countries of the Middle East were not consulted.

Middle Eastern oil was again militarily important as World War II dawned. So were the oilfields of Eastern Europe and Southern Asia. An embargo on Japan was one of the major causes of the attack on Pearl Harbour. The oil shortage that the embargo caused would have shut down Japanese industry. They sent a threat of war, stating that they would attack US assets in the Pacific, which was ignored by the US.

Hitler allied himself with Japan in an attempt to get them to attack Russia from the east which would have forced them to fight on two fronts and allowed Germany to reach the all important oil fields. Japan reneged on the deal and Hitler's forces, fighting on two fronts and short of fuel on both, ultimately lost the war.

In the Cold War that followed World War II, oil was again a major issue. Both the USSR and the United States were very active in the Middle East. Their motive was not to influence the governments for their ideologies, but to influence the governments for their oil. The economic war and the political war had become one.

US oil exploration played a part in Vietnam. Herbert Hoover had prepared a report on oil in the South China Sea back in the 1920s. His research indicated that there was a large amount oil off the coast of French Indo-China. Offshore drilling technology didn't exist at the time, so the report was largely ignored. The technology did exist by the time the US was considering getting involved in Vietnam though. The problem was that US interests had no power in the area and could not use the modern technology of the time to search for oil as a result. That technology consisted of taking readings from explosives set off under the water.

Once the US was involved in the war, largely through the Gulf of Tonkin incident the explosive soundings could be used under cover of the clearing of munitions from war planes returning to their aircraft carriers. The war also gave the US a reason to be there. If there was no "legitimate" reason to be there the government of Vietnam and the French would both have been making claims to the oil and protesting US exploration.

Oil is entwined with the war on drugs in South America. The two have become inseparable because the coca fields lay on top of oil fields. Corporate interests from the US need access to that land. While a huge number of Columbian military officers ( more than any other nation) have been trained at the School of the Americas, there is still a general consensus that the war on drugs and the war on terrorism are not related and that neither have anything to do with oil interests.

That consensus is not correct. According to the Centre for Research on Globalization in a February 2002 article titled US Oil Interests in Colombia, "The Colombian army and right wing paramilitaries (illegal armed groups with links to the Colombian army) protect and profit from foreign oil interests in Colombia. Despite a deteriorating human rights situation that the military claims it is too poor to address, the Colombian army spends nearly one quarter of its resources on defending oil installations. And credible reports document security contracts between oil companies and paramilitary groups. Those who are 'protecting US interests' in the region are doing so ruthlessly. Paramilitaries target local indigenous activists, and the labor leaders working in the oil industry have been among the most violently repressed in the world. Illegal armed groups are responsible for hundreds of murders and thousands of disappearances, many of which are directly linked to the protest of oil exploration and extraction activities."

That was two years ago though. Columbia has been moved to the back burner since the war in Afghanistan, where one of the first plans to show up was a pipeline to a port so the oil in Turkmenistan, Kazakhstan, and Uzbekistan could flow to tankers headed to North America. John Maresca, Vice President, International Relations, of Unocal Corporation certainly made a forceful argument when he spoke to the Subcommittee on Asia and the Pacific and asked them to, "...support repeal or removal of Section 907 of the Freedom Support Act." His goal was to facilitate, "The need for multiple pipeline routes for Central Asian oil and gas." .

Russia has had a long-standing interest in the Caspian fields for themselves. The Russians are no slouches when it comes to taking the resources of others to fulfill their own needs and spread their influence. A US-sponsored pipeline through Afghanistan would further reduce Russia's influence in the area, a long-standing US goal.

The US is presently in Iraq for oil. Not just Iraqi oil, but control of the oil in the area. The plan is for long-term dominance of the oil in the area. The recent handing back of Iraq to the US-approved Iraqi government did not give Iraq back its sovereignty or control over its oil.

Every conflict since World War One has been influenced by oil in some way. The current crisis in Sudan is largely driven by oil. As conflict increases over control of the oil fields civilians who live on the land above the oil are violently driven out. New roads are put in to access the oil carrying troops who attack the villagers. The oil companies are fully aware of the devastation being caused by their presence since the beginning. Canada's Talisman Energy and Sweden's Lundin Oil were forced to pull out of Sudan under pressure from human rights groups.

The complicity of the oil-related companies in conflicts over oil is nothing new. US Vice President Dick Cheney could yet face an indictment for actions taken by Haliburton in Nigeria while building a gas liquification facility for Shell Oil. Haliburton was bribing officials. Protestors were shot by police when they protested against the Shell facility.

There are many other examples. The Human Rights Watch and Amnesty International websites are full of examples of countries where the presence of oil has led to upheaval. Every developing nation where oil is discovered suffers from the exploitation of that resource. Governments fall, civil war breaks out, people are forcibly removed from their land and few see the wealth that the oil brings. The sudden discovery of oil in a developing nation is not a chance to better the lot of that nation's people. It is a path to violence.

In a world where it finally dawning on us that our dependence on oil has caused great environmental harm we should be highly suspect of any leader that would tolerate wars and human rights abuses in the name of oil. Electing leaders who would not only tolerate such things, but actively participate is something citizens of democracies should avoid at all costs.

Canada just went through an election where the leader of the opposition supported the war in Iraq. The leader of the party that continues to lead the country has been less than outspoken in his opposition of the war. The United States is currently in the midst of an election campaign. Their incumbent president fully supports the war in Iraq and has strong ties to Project for a New American Century, a group that sent a letter to Bill Clinton urging that Saddam Hussein be removed from power because he could endanger the USA's supply of oil from the Middle East.

The world deserves more from North America. We deserve more from ourselves.

---
Reverend Blair was raised in Saskatchewan and currently lives in Winnipeg, Manitoba. He comes from a long line of social activists and cried on Tommy Douglas before his first birthday. His column appears biweekly on Vive le Canada.



Note: oil Gulf of Tonkin incident entwined war on drugs School of the Americas Centre for Research on ... US Oil Interests in Col... pipeline spoke US-sponsored pipeline US-approved Iraqi gover... indictment Human Rights Watch Amnesty International

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Comments

  1. Tue Jul 06, 2004 5:54 pm
    Very interesting! I wonder what your take is on the whole <a href='http://www.reuters.com/newsArticle.jhtml?type=reutersEdge&storyID=5597898'>Yukos</a> thing. Is it punishing a dirty capitalist, or the NEP of Russia? There's more than one way to take over an economy ;)<p><p>---<br>"History does not repeat itself, but it does rhyme" Mark Twain <br />
    "The greatest price of not participating in politics is being governed by your inferiors." Plato

  2. Tue Jul 06, 2004 7:21 pm
    When oil finally does run out we may see the end of the worlds war machines as well. Unless they plan on converting planes and tanks to hydrogen as well (think big boom), the war industry is in for a big hurt.

    ---
    If there was ever a time for Canadians to become pushy - now is the time - for time is running out on this nation called Canada.

  3. Wed Jul 07, 2004 2:20 am
    It would have been much cheaper for the United States to just buy oil from Saddam than invade Iraq, why didn't they just do that? Especially since he was absolutely no threat to the U.S.

  4. Wed Jul 07, 2004 4:01 am
    Ah, but Saddam had shifted to selling oil in euros instead of US$ (aka petrodollars), and setting a bad example for other oil exporters (Venezuela's been toying with the idea, hence the trouble being made for Chavez). If the world no longer needed US$ to buy oil, the US$ would collapse (since it has little worth buying anymore; see the <a href='http://quote.bloomberg.com/apps/news?pid=10000103&sid=a3LrvBxXn2l8'>G$1½-per-day trade deficit</a>) ... that was the cost of not fighting the war, and an answer to the "why now?" question. <p>Three versions of this theory: <a href='http://www.ratical.org/ratville/CAH/RRiraqWar.html'>William Clark</a>, <a href='http://middleeastinfo.org/article4398.html '>Bulent Gokay</a>, <a href='http://www.currentconcerns.ch/archive/2003/04/20030409.php'>F. William Engdahl</a>.

  5. Wed Jul 07, 2004 4:21 am
    Ah the USA is the 4th reich. And while Canada is not (yet) like Colombia or Sudan, so far people have been brainwashed by this whole oil thing into thinking that Alberta is so hard done by by Ottawa, so they should separate. The RCMP have even been paid by the oil companies on the side to 'protect their interests.'

    ---
    Dave Ruston

  6. Wed Jul 07, 2004 4:25 am
    Oh, one more thing: The uS government doesn`t care how much a measly war costs their taxpayers, given that the war is paid for by the middle class and the poor! And bigger deficits are no concern. The uS government is merely a puppet to the oil companies, who want to maximize profit, by further monopolizing world supplies. And of course, the people in government get their little kick back.

    ---
    Dave Ruston

  7. by michou
    Wed Jul 07, 2004 11:44 am
    <i>When oil finally does run out we may see the end of the worlds war machines as well...the war industry is in for a big hurt.</i> We will ALL be in for a big hurt when oil finally runs out. Expect the war to spread at all levels of society and in every parts of the world if this happens. It will be survival of the fittest at its most primary level and the war industry will have become inconsequential in the fight for mankind's survival.

  8. Wed Jul 07, 2004 2:13 pm
    The world has lots of oil, China just doubled their reserve estimates after new exploration, there's enough oil for centuries even at increased consumption rates and more is being found all the time. Not that the world economy will necessarily need it for centuries, technological advancement will lead to less reliance on oil and at some point it won't be worth it to pump the stuff out of the ground because of cheaper alternatives.

  9. Wed Jul 07, 2004 3:02 pm
    Putin definitely <u>does not want</u> Russia's oil to be in the hands of private enterprise (read: foreign ownership) He has a point that Canada could learn.

  10. Wed Jul 07, 2004 3:05 pm
    The raison d'etre of of US industry is to transfer money from the public purse to private pockets, and they have long known that the military industrial complex is the most efficient way to do this.

  11. Wed Jul 07, 2004 3:42 pm
    <i>He has a point that Canada could learn</i><p> Yes. Take a sucessful business away from a public company, prosecute the guy in charge on dubious claims then nationalize the company. Great way to encourage forgien investment in your country. <p> If Putin can do it to Yukos, he can do it to anyone.<p><p>---<br>"History does not repeat itself, but it does rhyme" Mark Twain <br />
    "The greatest price of not participating in politics is being governed by your inferiors." Plato

  12. by L. Ray
    Wed Jul 07, 2004 4:24 pm
    "Once the US was involved in the war, largely through the Gulf of Tonkin incident"

    You are way off base on this one. The US got involved in the French effort to get "their colony" back from the beginning essentially financing the French military effort before they sent soldiers there.

    The Cold War was more than just a struggle over oil.

  13. by L. Ray
    Wed Jul 07, 2004 4:27 pm
    " enough oil for centuries.." "...China just doubled its reserves..."

    Just where do you take your figures from?
    The air?
    You got any evidence?

    Here's some evidenmce to indicate that we are at the beginning of the decline in oil production worldwide:

    http://www.hubbertpeak.com/

  14. by hoopoe
    Wed Jul 07, 2004 6:05 pm
    I have read articles in the past that oil producing countries have grossly overestimated their reserves. I can't remember the exact articles. If anyone else has further info on this please contribute it.



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