19 July 2007

Al Qaeda Is No Threat to Persian Gulf Oil

The US and the West will always have to opportunity to buy Persian Gulf oil, no matter who runs the Saudi Arabia, Iraq, Iran and the other Gulf States. The reason is simple: the oil exporters need to sell their oil as badly as we need to buy it.
A great deal of misguided US security policy focuses on securing US access to Persian Gulf oil. The Bush administration’s invasion of Iraq was really an extension of that misguided concern as it certainly had nothing to do with stopping terrorism. Not even Bush is stupid enough to think that Iraq was in any way tied to 11 September or that Iraq posed some sort of real threat. For that big lie, he should be impeached, but that’s another issue.
The basic concern is that religious nutters or some other hostile group would take over one of the countries on the Persian Gulf and halt oil exports, or in the worst case scenario, shoot at everything going through the Straights of Hormuz and stop all tanker traffic. In a war-game, that may seem like a dangerous situation. But it’s not going to happen.
The oil exporters all need the oil revenue to fund their governments. In the case of the two countries that could conceivably block the Straights of Hormuz, Saudi Arabia and Iran, oil exports account for 90% of Saudi’s export earnings and 80-90% of Iran’s. Similarly, oil exports make up 70-80% of Saudi’s state revenues and 40-50% of Iran’s, depending on the year and the prevailing oil price. What that means is that they are completely dependent on their oil exports. If one of those countries is overthrown by religious nutters, as indeed Iran was, that won’t change anything in regard to their oil exports. The US quit buying Iranian oil, but they certainly didn’t stop selling it.
Furthermore, any government of an oil exporter that quit exporting oil for ideological reasons wouldn’t last long. They would either be overthrown from within or a neighbour would take their oil fields. Let’s be honest with ourselves, back in 1990 if Kuwait had stopped exporting oil and Iraq stepped in, George Bush-the-elder would have voiced some lukewarm condemnation of the invasion and then gone golfing while congratulating himself again for personally winning the Cold War.
There are parallels to Persian Gulf oil. In Africa there are diamonds and other valuable minerals. If the governments don’t control the mines, rebel groups take over and run them. Even mercenaries get involved and are paid a portion of the mine’s revenues. The Middle East is a bit more organised than Africa, but it would not be hard to imagine similar situations arising if a bunch of Luddites who wanted to go back to 14th century technology as well as legal systems took over a country. Bear in mind that anyone exporting oil would have a lot more money to hire soldiers and buy weapons than a group that wouldn’t export oil.
In fact, the only conceivable situation that would stop a Middle Eastern country from exporting oil is invading it with a non-Muslim military force, seizing the oil for itself, while allowing the rest of the country to descend into anarchy. Sound familiar?

Labels: , , , ,


Post a Comment

<< Home