Belmont Club

Blood For Oil

Tim Arango and Clifford Krauss of the New York Times report that “despite sectarian bombings and political gridlock, Iraq’s crude oil production is soaring, providing a singular bright spot for the nation’s future and relief for global oil markets as the West tightens sanctions on Iranian exports.” The sky’s the limit apparently. “Foreign executives express cautious optimism that Iraq can eventually produce oil in amounts that could put it in an elite group of exporters with Saudi Arabia and Russia sometime in the 2020s.”

Wait a minute. Surely if America fought a war for oil, then Iraq’s oil resources would be in the hands of evil Republicans? But apparently not. Rather they are in the hands of the Russians and the Chinese. “Exxon Mobil has by far the largest stake of any American company in Iraq, but most of the major players are European and Asian, like Lukoil and Gazprom from Russia, and Chinese companies like China National Petroleum and China National Offshore Oil Corporation.” So there you have it. American blood, Russian and Chinese oil. Funny how that worked out.

From the outset it was clear that Americans were not going get the lion’s share of Iraqi oil. In 2009 “contracts on the first of Iraq’s two-day bidding round went to European and Asian oil companies eager to get back into the market and unafraid of assuming the risk of investing in Iraq. The traditionally less aggressive US oil majors were present but did not submit bids for the five fields on offer.”

The US firms tried going north to Kurdistan where they were welcome. But that made them anathema in the south. American oil companies are now being punished by Baghdad for daring to develop oil resources in the Kurdish regions. Reuters writes that “in the weeks before Iraqi Kurdistan revealed that Exxon Mobil had signed up to explore for oil there, executives at rival Shell faced a dilemma over whether or not to join the U.S. oil major in its foray north and risk angering Baghdad … but at the 11th hour, industry sources say, Royal Dutch Shell backed out and decided to focus on a $17 billion gas deal in the south rather than sign exploration contracts with the Kurdish Regional Government, which the central government could dismiss as illegal and could prompt reprisals.”

The reprisals were not long in coming.

Baghdad has since barred Exxon from bidding in the next round of oil deals, although it says the decision is not final. Exxon was also removed from its lead role in a water injection project in the south, although Iraqi officials denied the move was linked to the Kurdish deal.

If Iraq were fought for “oil” the evidence for it is extremely thin. In 2009 Time sheepishly wrote:

Those who claim that the U.S. invaded Iraq in 2003 to get control of the country’s giant oil reserves will be left scratching their heads by the results of last weekend’s auction of Iraqi oil contracts: Not a single U.S. company secured a deal in the auction of contracts that will shape the Iraqi oil industry for the next couple of decades. Two of the most lucrative of the multi-billion-dollar oil contracts went to two countries which bitterly opposed the U.S. invasion — Russia and China — while even Total Oil of France, which led the charge to deny international approval for the war at the U.N. Security Council in 2003, won a bigger stake than the Americans in the most recent auction.

What gave the European, Russian and Chinese companies the edge? Why ‘other considerations’. “The bidding was extremely tough,” said one official in Baghdad, in an email. “My guess is that [the U.S. companies] could not match the offers from others.” There’s a moral in there somewhere, or perhaps a lack of it. There may even be traces of a monstrous calumny laid upon those who it now turns out, deserved none of it. But if anyone’s waiting for an apology from that paragon of virtue, the Left, they shouldn’t  hold their breath now that Russia and China have the money.

But it’s not really the Left’s fault. It’s everyone else’s fault for taking them seriously. For actually believing they sincerely mean it when they say they are the unselfish defenders of the downtrodden; the guys who care nothing for money and everything about principle. Consider the correct attitude towards capitalism. Making a profit is immoral right? Well tell the Obama campaign.

If anyone is wearing any item sporting the “O” logo created by the Obama campaign, the campaign wants that money from the sale going straight to their coffers, reports the Associated Press. So the Obama campaign is suing

“We have always cooperatively worked with Democratic campaigns,” he said. Schwat said his company, which is based in Washington, has been providing Democrats with political materials since 1985 and worked with the presidential campaigns of Bill Clinton, John Kerry, Al Gore and Howard Dean, among others. He said state and county groups rely on his site, which supports only Democrats, to get materials. And he said those groups don’t want to go to Obama’s website and pay more. For example, a white T-shirt with the Obama logo is $30 at the campaign’s site, but a group that wants to buy in bulk can get 500 from at $5.49 each.

Can’t have people saving money can we? In the end the Left gets both the money and the moral high ground. Why? We believed them.

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