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Keeping Iraq's Oil in the Ground by Greg Palast

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LSK Donating Member (1000+ posts) Send PM | Profile | Ignore Fri Nov-23-07 03:21 PM
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Keeping Iraq's Oil in the Ground by Greg Palast
Edited on Fri Nov-23-07 03:26 PM by LSK
This is a little old, I ran across it yesterday. It includes a good little history of Iraq's oil production since the early 1900s.

Big Oil's interest was in suppressing production, that is, keeping Iraq to its OPEC quota or less. This raises the question, did the petroleum industry, which had a direct, if hidden, hand, in promoting invasion, cheerlead for a takeover of Iraq to prevent overproduction?


Should Iraq drill on that scale, the total, when combined with the Saudis', will drown the oil market. That wouldn't make the Texans too happy either. So Fadhil Chalabi's plan for Iraq to pump 12 million barrels a day, a million more than Saudi Arabia, is not, to use Bob Ebel's (Center fro Strategic and International Studies) terminology, "ridiculous" from a raw resource view, it is ridiculous politically. It would never be permitted. An international industry policy of suppressing Iraqi oil production has been in place since 1927. We need again to visit that imp called "history."

It began with a character known as "Mr. 5%"- Calouste Gulbenkian - who, in 1925, slicked King Faisal, neophyte ruler of the country recently created by Churchill, into giving Gulbenkian's "Iraq Petroleum Company" (IPC) exclusive rights to all of Iraq's oil. Gulbenkian flipped 95% of his concession to a combine of western oil giants: Anglo-Persian, Royal Dutch Shell, CFP of France, and the Standard Oil trust companies (now ExxonMobil and its "sisters.") The remaining slice Calouste kept for himself - hence, "Mr. 5%."

The oil majors had a better use for Iraq's oil than drilling it - not drilling it. The oil bigs had bought Iraq's concession to seal it up and keep it off the market. To please his buyers' wishes, Mr. 5% spread out a big map of the Middle East on the floor of a hotel room in Belgium and drew a thick red line around the gulf oil fields, centered on Iraq. All the oil company executives, gathered in the hotel room, signed their name on the red line - vowing not to drill, except as a group, within the red-lined zone. No one, therefore, had an incentive to cheat and take red-lined oil. All of Iraq's oil, sequestered by all, was locked in, and all signers would enjoy a lift in worldwide prices. Anglo-Persian Company, now British Petroleum (BP), would pump almost all its oil, reasonably, from Persia (Iran). Later, the Standard Oil combine, renamed the Arabian-American Oil Company (Aramco), would limit almost all its drilling to Saudi Arabia. Anglo-Persian (BP) had begun pulling oil from Kirkuk, Iraq, in 1927 and, in accordance with the Red-Line Agreement, shared its Kirkuk and Basra fields with its IPC group - and drilled no more.


Seems that Iraq has always been fucked when it comes to oil. They have been prevented from drilling and selling their oil for many decades and that continues today, to Saudi Arabia's benefit.

Additional material on the subject can be found:
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n2doc Donating Member (1000+ posts) Send PM | Profile | Ignore Fri Nov-23-07 03:27 PM
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1. The really ironic thing would be if they eventually do get free of us
And then pump oil that is much more expensive than it would have been had Sadaam pumped it back in the 90's.

The longer it sits in the ground the more expensive it gets. The question is- who will get the money? I can't see the locals sitting around and letting the multinationals take it all without a fight. Probalby that is what is behind the drive for a strongman to "run things" -then they can follow the Nigerian model- a few corrupt rich pols running things with the multinationals running off with the resources. The People always lose...
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DCKit Donating Member (1000+ posts) Send PM | Profile | Ignore Fri Nov-23-07 03:47 PM
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2. Maybe old, but entirely relevant.
These facts need to be kept at the front so that we all know what we're fighting against.
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Prophet 451 Donating Member (1000+ posts) Send PM | Profile | Ignore Fri Nov-23-07 05:07 PM
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3. I don't think he goes far enough
Admittedly, I have no evidence for this but it's my suspician that the invasion of Iraq was designed to fail, keeping the country in chaos so that oil will never be pumped and the price will stay high.
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Reno.Muse Donating Member (307 posts) Send PM | Profile | Ignore Fri Nov-23-07 05:35 PM
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4. if a person understands this, then it's not hard to connect the dots on 9-11 and invasion by US
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Disturbed Donating Member (1000+ posts) Send PM | Profile | Ignore Fri Nov-23-07 05:44 PM
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5. The rush to over throw Saddam was about oil.
The UN Sanctions would have been lifted had the UN Inspectors been allowed
to complete their task. After that Saddam vowed to sell Iraqi oil via the Euro.
This is why the US & UK decided to invade. The WMDs was merely a story that was cooked
to get the American & Brit public to go along with the Illegal Invasion.
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AlertLurker Donating Member (877 posts) Send PM | Profile | Ignore Fri Nov-23-07 08:16 PM
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6. The whole idea was to CONTROL the market...
They don't have to exploit the RESOURCE to do that, just the FEAR.
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KoKo Donating Member (1000+ posts) Send PM | Profile | Ignore Sat Nov-24-07 06:11 PM
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7. Greg Palast is a Truth Teller that even our "LIberal Media"doesn't want to Touch...
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