Counterculture Con HQ

December 27, 2009

Big Oil Not So Big

Remember all that Iraqi oil Bush was accused of destroying the Twin Towers over?  Remember how we invaded Iraq to steal all the oil and make slaves of the Iraqi people?  Apparently those wrecked towers, and all that American blood and treasure got the “Big Oil” puppetmasters nothing.

U.S. Companies Shut Out as Iraq Auctions Its Oil Fields

Those who claim that the U.S. invaded Iraq in 2003 to get control of the country’s giant oil reserves will be left scratching their heads by the results of last weekend’s auction of Iraqi oil contracts: Not a single U.S. company secured a deal in the auction of contracts that will shape the Iraqi oil industry for the next couple of decades. Two of the most lucrative of the multi-billion-dollar oil contracts went to two countries which bitterly opposed the U.S. invasion – Russia and China – while even Total Oil of France, which led the charge to deny international approval for the war at the U.N. Security Council in 2003, won a bigger stake than the Americans in the most recent auction. “[The distribution of oil contracts] certainly answers the theory that the war was for the benefit of big U.S. oil interests,” says Alex Munton, Middle East oil analyst for the energy consultancy Wood Mackenzie, whose clients include major U.S. companies. “That has not been demonstrated by what has happened this week.”

In one of the biggest auctions held anywhere in the 150-year history of the oil industry, executives from across the world flew into Baghdad on Dec. 11 for a two-day, red-carpet ceremony at the Oil Ministry, broadcast live in Iraq. With U.S. military helicopters hovering overhead to help ward off a possible insurgent attack, Oil Minister Hussein Al-Shahrastani unsealed envelopes from each company, stating how much oil it would produce, and what it was willing to accept in payment from Iraq’s government. Rather than giving foreign oil companies control over Iraqi reserves, as the U.S. had hoped to do with the Oil Law it failed to get the Iraqi parliament to pass, the oil companies were awarded service contracts lasting 20 years for seven of the 10 oil fields on offer – the oil will remain the property of the Iraqi state, and the foreign companies will pump it for a fixed price per barrel.

Far from behaving like the war-ravaged, bankrupt country that it is, Iraq heavily weighted the contracts in its own favor, demanding a low per-barrel price and signing bonuses of up to $150 million. Only one U.S. company, Occidental Petroleum Corp., joined the bidding last weekend, and lost. (ExxonMobil had hoped to land the lucrative Rumaila field, but lost out to an alliance between the Chinese National Petroleum Company and BP because it declined the Iraqi government’s $2-a-barrel fee.)

That might have been the thinking of U.S. oil giants, which largely stayed away from last week’s bidding, and which have failed to negotiate oil deals with Iraq’s government outside of the public auction process. Iraqi officials say they are not awarding contracts based on political considerations, but simply a straight comparison of prices and production targets. “The bidding was extremely tough,” said one official in Baghdad, in an email. “My guess is that [the U.S. companies] could not match the offers from others.” In Iraq, at least, the victor has no special claim on the spoils of war.

So “big oil” isn’t so big after all. Not that I care which oil companies secure the contracts, as the oil ends up on the same global market anyway.  This is only noteworthy because it puts to rest the college dormroom level attacks on Bush and the Iraq war we’ve all had to endure for the last 8 years.  Because this proves Iraq is a sovereign country.  It’s as free as any country the Middle East has ever been.  And it’s free and sovereign, not because of the likes of Code Pink, Cindy Sheehan, Harry Reid, et al.  Far from it.  Everything they wished for Iraq would have guaranteed chaos and neverending civil war.  All because of their hatred of Bush.  That cowboy.  That moron.  The guy who liberated more Iraqis than a thousand Amnesty Internationals writing a thousand letters a day for a thousand years could ever hope to liberate.  That’s why Iraq is free today.  The guy who stuck to his guns, while the war’s detractors vanished into thin air the minute Barack Obama was elected to office; their position on Iraq not so principled as we’d been led to believe.  And had they succeeded in driving Bush out of Iraq, they would have made themselves equally as scarce as that country descended into genocidal anarchy.  But where did all those war protesters go anyway?  I see them pop up occassionally in the comments sections across the internet, but the streets are clean of them.  Were they against the war, or were they against Bush?  Methinks CCHQ will have to devote some time in the future to that question.  In the 70s, anti Vietnam war protests also mysteriously vanished when the draft was abolished.  Apparently it was the draft they were against, not the war.  And if the Left thinks Iraq exercising its sovereignty is Obama’s doing, they simply aren’t aware that Iraq was giving away oil contracts to non-U.S. companies long before Obama was even a twinkle in their eye.  Not a single U.S. oil company won a contract to extract Iraqi oil.  I am all for America acting in its own enlightened self-interest and reaping the benefits.  But this is also something to be proud of.  We aren’t stealing their oil, or telling them how to run their business.  Iraq is a free and sovereign country.  That is all the vindication you need, gentle readers.  You were right, they were wrong.

H/T: Worth Reading