Bloomberg reports: “Iraq’s crude production overtook Iran’s last month for the first time in more than two decades… The rising rate of Iraqi production comes as foreign investors such as ExxonMobil Corp. and BP are developing new fields and reworking older deposits.”
GREG MUTTITT, dlee at thenewpress.com
Currently touring the U.S., Muttitt (based in London) is author of the just-released Fuel on the Fire: Oil and Politics in Occupied Iraq. He said today: “Government officials meeting in the Pentagon before the Iraq war planned to use the U.S. occupation to open the country to Big Oil. The documents, marked SECRET/NOFORN, were obtained under the Freedom of Information Act and reveal for the first time the role of the Energy Infrastructure Planning Group, which was established in 2002 by Undersecretary of Defense for Policy Douglas Feith to plan how to run the Iraqi oil industry under the Coalition Provisional Authority.
“In a November 2002 presentation to the Deputies Committee of the National Security Council, EIPG proposed not to repair war damage to oil infrastructure, as doing so ‘could discourage private sector involvement” in rebuilding the industry. That proposal however was rejected, in order to ‘minimize disruptions and promote confidence and stability in world markets’ and to maximize revenues to finance the administration of Iraq.
“In January 2003, EIPG instead proposed a new strategy under which initial repairs — carried out by Halliburton subsidiary Kellogg, Brown & Root — would be followed by long-term contracts with multinational companies to expand Iraqi oil production to five million barrels per day, awarded by the U.S. occupation authority. Although noting that many believed such decisions should be left to a future Iraqi government, EIPG argued that this expansion held advantages including putting ‘long-term downward pressure on [the oil] price’ and forcing ‘questions about Iraq’s future relations with OPEC.’ With private companies operating in Iraq since 2010, those questions have already begun to surface: last month analysts noted that Iraq’s rising production could constrain OPEC’s ability to influence oil prices.
“At the same time as making these proposals, EIPG recommended the government state publicly that ‘We will act, through our administration, so as not to prejudice Iraq’s future decisions regarding its oil development policies; its relations with international organizations; [or] the future ownership structure of its oil industry’ — a public position directly contrary to the substantive policy it proposed.
“These documents provide conclusive proof that control of Iraq oil was a critical consideration at the highest levels of the U.S. government while it was planning the Iraq war. There was little regard for the welfare of Iraqis, but the welfare of companies like ExxonMobil was central to the administration’s thinking. It is particularly troubling that the EIPG recommended the government mislead the public on its oil plans.
“The British government repeatedly met BP and Shell in late 2002, to discuss how to help them achieve their aims in post-Saddam Iraq. BP said it was ‘desperate to get in there;’ the Trade Minister said she believed that if Britain participated in the war its companies should get a share of the spoils. The U.S. government in 2006 hired a lawyer to draft a new Iraqi law to reverse the country’s oil nationalization of the 1970s. Getting this oil law passed became the Bush administration’s top priority in 2007, and was closely tied to the ‘surge’ strategy. After BP won a contract to run Iraq’s largest oilfield in 2009, following an apparently transparent process, its terms were renegotiated in secret, such that the Iraqi government would take the major risks and BP’s profits be guaranteed. In spite of all these pressures, Iraqi civil society groups achieved surprising successes in thwarting the U.S. oil plans through popular campaigns, unreported in the West.”
Muttitt was interviewed Monday on Democracy Now.
