Shaky Foundations: The US in the Middle East
(Middle East Report 220, Fall 2001)

Editorial

Upon its installment in the White House, the second Bush administration was universally expected to be the loyal handmaiden of Big Oil. The US oil and gas industry lavished $1,387,975 upon the hastily assembled committee which planned the inaugural festivities for George W. Bush and Dick Cheney. BP-Amoco contributed $100,000, and executives from Conoco, Chevron and Exxon Mobil ponied up the same amount. In all, Big Oil gave $26 million to Bush, Cheney and their fellow Republicans in the 2000 election campaign. As if on cue, Cheney's national energy policy report, released in May, recommended drilling in the Alaskan National Wildlife Refuge, and the administration sent emissaries to secure US energy interests in South Asia and elsewhere. Yet, awash as they are in petrodollars, Bush and Cheney have not exactly done Big Oil's bidding in the Middle East, the industry's most lucrative field of operations by far. In the 1990s, the calls of oil executives to lift US trade and investment sanctions on Middle Eastern "rogue states" became something of a broken record. Relations with the guardians of the vast reserves in Iran, Iraq and Libya are—if anything—chillier than they were six months ago.

Part of the reason, certainly, is that lifting sanctions on any of these countries would contradict years of US rhetoric about "terrorism" and "weapons of mass destruction," not to mention the howls of Congressional protest which greet the bare mention of thawed relations with Iran or Libya. The State Department meekly withdrew its proposal to renew the Iran-Libya Sanctions Act for two years when Congress demanded renewing it for five. (Not coincidentally, the pro-Israel lobby has been harping on the Persian peril to US interests since Iran upped its pro-Palestinian rhetoric after the Camp David II fiasco.) Another part of the reason, surprisingly enough, is that the Bush-Cheney White House has few personal connections with the large international companies that thirst after Middle Eastern oil. The administration's oilmen—including Bush and Cheney themselves—come not from supermajors like Exxon Mobil or Chevron, but from leaner Texan firms that drill in the US or sell services to the majors. These oil independents, and energy traders like Enron, are the most important cogs in the Bush-Cheney fundraising machine. According to the Center for Public Integrity, Enron has given more money to George W.'s campaigns than any other donor. Enron generates electricity in India and Brazil, but doesn't care about the remaining "easy oil" in the Middle East. (In July, Enron sold its only interest in a Middle East operation—gas fields in Qatar.)

It isn't that the administration doesn't crave the "energy security" that the opening of sanctioned oilfields would buy. For all its talk of "clean coal" and reviving nuclear power, Cheney's task force report reveals an abiding interest in Middle Eastern oil. The reason is simple. By 2020, US oil consumption will have increased by 32 percent, while domestic production will remain steady. Barring a sudden outbreak of environmental responsibility among the makers and owners of SUVs, this means greater dependence on imports. Roughly two thirds of the world's proven oil reserves are in the Persian Gulf. 14 percent of US oil imports today come from Saudi Arabia, the second largest single supplier (behind Canada).

Cheney's report applauds the Kingdom for being "a linchpin of supply reliability," but also for showing willingness to fill the deficit in world oil supply in the event of "disruptions." Though the culprit is not named, the disruptions would presumably come from Iraq, which is the fifth largest exporter of oil to the US despite sanctions. The phrase betrays the Cheney task force's awareness that Gulf oil supply is precarious, even if—probably naively—the administration hopes that Iraq is a short-term problem. As Michael Klare argues in his new study Resource Wars, over the long term maintaining the flow of Gulf oil to the West is likely to require US intervention. For now, the US is pressuring Gulf countries to privatize their national oil and gas industries, while seeking to expand its military deployment, as with the widely rumored negotiations over pre-positioning of US aircraft in the United Arab Emirates. To open Middle Eastern "rogue states," Big Oil has only the carrot of investment dollars. The sticks of the White House are many.