What a telling medley of articles in the New York Times June 19. First this, from the front page [2]:
Deals With Iraq Are Set to Bring Oil Giants Back
BAGHDAD — Four Western oil companies are in the final stages of negotiations this month on contracts that will return them to Iraq, 36 years after losing their oil concession to nationalization as Saddam Hussein rose to power.Exxon Mobil, Shell, Total and BP — the original partners in the Iraq Petroleum Company — along with Chevron and a number of smaller oil companies, are in talks with Iraq’s Oil Ministry for no-bid contracts to service Iraq’s largest fields, according to ministry officials, oil company officials and an American diplomat.
The deals, expected to be announced on June 30, will lay the foundation for the first commercial work for the major companies in Iraq since the American invasion, and open a new and potentially lucrative country for their operations.
The no-bid contracts are unusual for the industry, and the offers prevailed over others by more than 40 companies, including companies in Russia, China and India. The contracts, which would run for one to two years and are relatively small by industry standards, would nonetheless give the companies an advantage in bidding on future contracts in a country that many experts consider to be the best hope for a large-scale increase in oil production.
There was suspicion among many in the Arab world and among parts of the American public that the United States had gone to war in Iraq precisely to secure the oil wealth these contracts seek to extract.
Oh please, spare us the far-fetched conspiracy theories. Next this, also on the front page, just one column over [3]:
Dearth of Ships Delays Drilling of Offshore Oil
As President Bush calls for repealing a ban on drilling off most of the coast of the United States, a shortage of ships used for deep-water offshore drilling promises to impede any rapid turnaround in oil exploration and supply...Mr. Bush called on Congress Wednesday to end a longstanding federal ban on offshore drilling and open the Arctic National Wildlife Refuge for oil exploration, arguing that the steps were needed to lower gasoline prices and bolster national security.
In other words the Iraq invasion a.) allowed Exxon and their ilk to get back into Iraq after more than a generation, and b.) sparked the oil shock—thereby creating the necessary climate for them to get back onto the Florida Coast, and ultimately into ANWR. Tell us again how the war is not about oil [4]? Finally, just to remind us of OPEC's perennial role in the propaganda system as flack-catcher for the other cartel (Exxon & ilk), this from the op-ed page, by former Reagan/Bush advisor Thomas Evans:
Sue OPEC
THE president of the United States has the power to attack, and perhaps destroy, the Organization of the Petroleum Exporting Countries, the illegal cartel that has driven the price of oil over $130 per barrel. This can be accomplished without invasion or bombing. No special legislation is needed. The president need simply allow the states to seek relief in the Supreme Court under our antitrust laws.The oil ministers of the OPEC countries meet periodically to set production quotas for the cartel's members and in the process establish an artificially high price for crude oil. Under our antitrust laws, this is illegal...
Despite this illegal conduct, not everyone can sue OPEC and succeed. In 2002, a federal court dismissed a class-action lawsuit brought against OPEC by a gas station owner. An appeals court agreed...
Fortunately, there is another way to sue OPEC. Even if actions by individual citizens fail, a seldom-used provision of Article III of the Constitution grants original jurisdiction to the Supreme Court over lawsuits brought by states against "foreign states" and, as expanded by the United States Code, over "aliens."
The attorneys general of the various states should sue OPEC as an alien or, pleading alternatively, as a foreign state...
If the president allowed the states to sue OPEC, his actions would undoubtedly anger political leaders in the Middle East and create the need for diplomatic initiatives to limit the fallout. But how stable is the Middle East right now? And isn’t starting a lawsuit better than starting a war?
The war started five years ago—or seven if you include Afghanistan. The price hike is the fruit of this destabilization. OPEC (in contrast to the situation in 1973) is pumping the stuff out of the ground like crazy. Yet it still serves as a convenient scapegoat for the real masterminds of the contrived crisis.
See our last posts on Iraq [5], the struggle for Iraq's oil [6], the struggle for global oil [7], and the struggle for Alaska [8].
