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Iraqi oil and global power

The oil is flowing again in Iraq. Iraq’s oil ministry hopes 4.5m barrels per day will be extracted by 2013. Even if production falls short of this goal, it will bring in considerable revenue to those who own it. Where will that money go?

First, it will go to oil companies, executives and shareholders in particular.  Not only do large oil firms, which function largely as the right-arm of the modern state, benefit directly from the forced opening up of the resources of weaker states; they also benefit from the higher prices that result from the instability in the newly-“liberated” nation. Let us see which firms have acquired the largest stakes.

The usual suspects, such as Royal Dutch Shell, ExxonMobil and BP, have won the usual concessions. Mixed in with them, though, are the China National Petroleum Corporation, Japan Petroleum Exploration Co., the Korea Gas Corp, Malaysia’s Petronas, Turkish Petroleum International and Russia’s Lukoil and Gazprom. Iraq’s oil is being auctioned off to the powerful people who might otherwise have had the power to block future war. Now that they profit from it, they are likely to support it more willingly in future.

Some Iraqis will make money from it as well. Those in the government, plus the rich and powerful connected to the government, will likely profit heavily. Corruption and inequality will increase. Some of the people who do not benefit from oil revenues will demand some of it. Rather than give it up, the new rulers of Iraq will spend it to repress the Iraqi people. If history is any guide, that repression will lead to protests, religious extremism and terrorism.

Iraq is not very democratic, as a mere glance at the violence of Iraqi politics makes clear. Democracy does not, in any case, mean justice or equality. It does not guarantee that voters will have any control over the oil or see any revenue from it “trickle down”. One might say it would be fair to give that oil to the Iraqi people, particularly the millions that lost loved ones over the past twenty years due to sanctions and invasions. Those having babies with birth defects could probably use the cash, too. But then, fairness is not something the powerful tend to bestow on the world.

The spreading around of Iraq’s oil to the global power elite will have the effect of making similar aggression against weak but resource-rich states worldwide easier. When Russian and Chinese oil firms profit from the newly-acquired oil fields, they will support more such interventions. Of course, they will protest, but only in public. We have seen the uprising against Gaddafi turned into an excuse to invade another OPEC member. The multilateral nature of the intervention grants it the veneer of legitimacy while the plunderers make off with the booty.

Taxpayers from powerful countries are paying for invasions of weak countries and the killing and torture of resisters so that the world’s power elite can become more powerful. Expect less democracy, more terrorism and more “humanitarian intervention” everywhere as a result.

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  1. March 6, 2012 at 1:40 pm
  2. May 28, 2012 at 2:35 pm
  3. November 20, 2013 at 1:50 am

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