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Commentary: The Real Oil Story

By Walter Simpson

Buffalo, NY – Oil is pretty slippery stuff. The press is playing up $3 a gallon gasoline, record oil company profits, and the $400 million retirement package for Exxon's former CEO. But these stories are trivial compared to the oil story they have ignored all along. The war in Iraq. It's an oil war. And you don't have to take my word for it. Read former Republican strategist Kevin Phillips new book, American Theocracy: the Peril and Politics of Radical Religion, Oil, and Borrowed Money in the 21st Century. The corporate media may have failed us but authors like Phillips are providing the needed analysis.

Bush, Cheney, Rice and other key Bush players have impeccable oil industry credentials. When they came to the White House, so did the oil industry. Cheney, Rumsfeld and others also have strong ties to the Project for a New American Century, a neo-conservative organization which unabashedly advocates U.S. world supremacy through pre-emptive war, regime change for governments they don't like, and permanent military bases in the Persian Gulf to secure U.S. interests - foremost among them oil. U.S. world domination requires not only access to oil but control of it - a tall order since 65% of the world's oil reserves lie within the boundaries of a handful of Arab countries.

Phillips explains that coveting and safeguarding Persian Gulf oil has long been a cornerstone of U.S. foreign policy. We've struck deals, propped up royal families, supported coups, and armed dictators to keep the oil flowing in our direction and to give U.S. oil companies a piece of the action. We've also waged at least one prior war for oil, the first Gulf War in 1991. If Bush did not consider oil when deciding to invade Iraq, it would be the first time in fifty years that guaranteeing an uninterrupted flow of Persian Gulf oil was not a central element of U.S. foreign policy.

But this oil business has gotten more serious. Right now a very hungry United States consumes 25% of the world's annual output of oil and imports 10 million barrels of oil per day. Cheney's energy task force predicted that U.S. imports will need to rise to 17 million barrels a day by 2020. Without controlling foreign oil reserves, obtaining that oil could be impossible - because the demand for oil from other countries like China and India is rising just as the peak oil phenomenon is expected to kick in resulting in a steady decline in global oil production.

Making things worse is the loss of Saudi Arabia as a dependable ally and host for U.S. military bases because of its increasing political instability. By invading, occupying and setting up a client state in Iraq, the Bush Administration hoped not only to gain control over Iraqi oil reserves, the world's second largest, but also to establish a new base of operations in the Persian Gulf.

Phillips and other analysts don't think it was a coincidence that U.S. troops first guarded oil wells, pipelines, refineries and the Iraqi Oil Ministry when they invaded Iraq while ignoring the need to maintain civil order. The military had its marching orders and they had to do with oil.

Rumsfeld may deny it (and he did again just last week) but the U.S. is now building a number of permanent super-military bases in Iraq -- to project U.S. power, to control oil production, distribution and prices, to forestall the Euro from supplanting the dollar as the currency of international oil trade, and to guarantee business and profits for U.S. oil companies. As the war and occupation degenerate, neo-conservative hopes and dreams may be dashed. But for now, talk of withdrawal is just that -- talk.

Motivation for this oil war also came from Saddam Hussein's plans to sell oil concessions to French, Russian and Chinese firms as soon as sanctions were lifted, thus locking U.S. oil companies out of lucrative Iraqi oil deals worth potentially trillions of dollars. Phillips recounts the disclosure in 2003 of oil maps used by Cheney's energy task force. These were developed by the Pentagon and showed existing Iraqi oil fields, possible new super-fields, and details on foreign companies bidding on Iraqi oil. Former Bush Administration Secretary of the Treasury Paul O'Neil saw these maps and said it was clear to him that plans were being made, well before 9/11, to invade Iraq for reasons of oil not terrorism.

There's no doubt that the $3 gas we put in our tanks runs red with the blood of our soldiers and tens of thousands of Iraqis who have died in this war. We need to open our eyes to this hard reality.

"Reality Check" with Commentator Walter Simpson is a monthly feature of WBFO News.

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