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The Iraqi oil conundrum

• Michael Schwartz
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The Iraqi oil conundrum
By Michael Schwartz

How the mighty have fallen. Just a few years ago, an overconfident George W Bush administration expected to oust Iraqi dictator Saddam Hussein, pacify the country, install a compliant client government, privatize the economy, and establish Iraq as the political and military headquarters for a dominating US presence in the Middle East.

These successes were, in turn, expected to pave the way for ambitious goals, enshrined in the 2001 report of vice president Dick Cheney's secretive task force on energy. That report focused on exploiting Iraq's monstrous, largely untapped energy reserves - more than any country other than Saudi Arabia and Iran - including the quadrupling of Iraq's capacity to pump oil and the privatization of the production process.

The dream in those distant days was to strip the Organization of the Petroleum Exporting Countries (OPEC) - the cartel consisting of the main petroleum exporters - of the power to control the oil supply and its price on the world market. As a reward for vastly expanding Iraqi production and freeing its distribution from OPEC's control, key figures in the Bush administration imagined that the US could skim off a small proportion of that increased oil production to offset the projected $40 billion cost of the invasion and occupation of the country.

All in a year or two.

Almost seven years later, it will come as little surprise that things turned out to cost a bit more than expected in Iraq and didn't work out exactly as imagined. Though the March 2003 invasion quickly ousted Saddam Hussein, the rest of the Bush administration's ambitious agenda remains largely unfulfilled.

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