The Price of Oil

I don't really know what to say. I don't know how to put it. The manna from heaven that came down upon the Middle East dragging it out of obscurity so that those sitting upon it couldn't believe their luck. The poor bedouin became oil magnate, lord of the land. He walked with his head high, chest out, shopping in Harrods, driving in Rolls, and he couldn't believe his luck. And he feasted and others stood by envious of his bounty, wishing they too had this black liquid oozing from between their toes. But there was a price. People were hungry, and you were naive walking around with all that wealth. And as you feasted they came and they feasted upon you. Now we're all drowning in the muck. We're all tainted and can't escape our addiction. The ground is coming closer and all we can do is grip our seats and hope..... The two articles enclosed below opened my eyes. We are in big trouble. So Iraq Was About the Oil

By Robert Parry November 8, 2005

When Colin Powell’s former chief of staff Lawrence Wilkerson publicly decried the Bush administration’s bungling of U.S. foreign policy, the focus of the press coverage was on Wilkerson’s depiction of a “cabal” headed by Vice President Dick Cheney that had hijacked the decision-making process.

Largely overlooked were Wilkerson’s frank admissions about the importance of oil in justifying a long-term U.S. military intervention in Iraq. “The other thing that no one ever likes to talk about is SUVs and oil and consumption,” the retired Army colonel said in a speech on Oct. 19.

While bemoaning the administration’s incompetence in implementing the war strategy, Wilkerson said the U.S. government now had no choice but to succeed in Iraq or face the necessity of conquering the Middle East within the next 10 years to ensure access to the region’s oil supplies.

“We had a discussion in (the State Department’s Office of) Policy Planning about actually mounting an operation to take the oilfields of the Middle East, internationalize them, put them under some sort of U.N. trusteeship and administer the revenues and the oil accordingly,” Wilkerson said. “That’s how serious we thought about it.”

The centrality of Iraq’s oil in Wilkerson’s blunt comments contrasted with three years of assurances from the Bush administration that the war had almost nothing to do with oil.

When critics have called the Iraq War a case of “blood for oil,” George W. Bush’s defenders have dismissed them as “conspiracy theorists.” The Bush defenders insisted the president went to war out of concern about Iraq’s weapons of mass destruction and Saddam Hussein’s links to al-Qaeda, neither of which turned out to be true. Later, Bush cited humanitarian concerns and the desire to spread democracy.

Always left out of the administration’s war equation – or referenced only obliquely – was the fact that Iraq sits atop one of the world’s largest known oil reserves at a time when international competition is intensifying to secure reliable oil supplies.

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Running on empty

Jeremy Leggett explains how a bid to defuse the coming global peak-oil crisis was sidelined

Jeremy Leggett Tuesday November 8, 2005

Guardian Unlimited

History shows that James Schlesinger, a former director of the CIA, is not a man to mess with. As secretary of defence during the first oil shock in 1973, he threatened to invade the Arabian peninsula if the Saudis didn't reopen the oil pumps they had shut down in ire over the October war, thus precipitating the crisis.

In an interesting contrast with the US's current professed intentions in Iraq, Mr Schlesinger was on record then as saying: "Militarily we could have seized one of the Arab states. And the plan did indeed scare and anger them. No, it wasn't just bravado. It was clearly intended as a warning. I think the Arabs were quite worried about it after 73".

So it was with some surprise that participants in last week's oil summit in Rimini, Italy, heard Mr Schlesinger give a speech warning of a grave threat to the world economy from a coming peak in oil production.

Addressing a select audience that included oil ministers and senior officials from the oil cartel Opec, the energy watchdog International Energy Agency, and the UN, plus advocates of a premature oil peak such as the former British cabinet minister Michael Meacher, Mr Schlesinger offered a graphic analogy.

The peak-oil threat and the response to it are reminiscent, he said, of the rumbles under Vesuvius and the reaction to them of its hapless residents. "The peak or plateau is coming," he said.

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