The title of Greg Muttitt's Fuel on the Fire: Oil and Politics in Occupied Iraq is a pun. His dual theme is that the United States enflamed a sectarian war in Iraq in a divide-and-rule strategy ultimately aimed at establishing control over the country's oil. He makes the case with far greater sophistication than the conspiratorial tomes typically favored by the political left. At the same time, he assembles enough damning words from exponents of imperial officialdom to frustrate any attempts to dismiss his thesis from the right.
"Iraq is the big oil prospect," read the minutes of a meeting of the British Foreign Office in November 2002, six months before the U.S.-led invasion in which the UK was junior partner. "BP are desperate to get in there." And it was Britain that really charted the strategy that Muttitt details, with its own imperial adventure in Iraq after World War I. Winston Churchill, who as head of the Admiralty oversaw the switch of the British war fleet from coal to oil, urged on the very eve of the 1914 incident at Sarajevo that the UK's military must become "the owners or, at any rate, the controllers at the source" of a large volume of foreign oil.
True to the pattern to be emulated generations later by the White House, once Britain was mired in a counterinsurgency war in Iraq, Churchill denied any such base motive. In 1920, he declared the notion that the adventure was undertaken "in order to secure some advantage in regard to some oilfields...too absurd for acceptance." Meanwhile, Britain was overseeing establishment of the Iraq Petroleum Company (IPC), made up of the Anglo-Persian Oil Company (forerunner of BP), Compagnie Française de Pétroles (forerunner of Total) and Standard Oil (forerunner of ExxonMobil).
When the British-backed Hashemite monarchy was overthrown in a popular uprising in 1958 — five years after the UK had teamed up with the CIA in Iran to oust the Mossadeq government, which had dared to nationalize Anglo-Persian's holdings — The New York Times wrote that "intervention will not be extended to Iraq as long as the revolutionary government in Iraq respects Western oil interests." However, amid coups and countercoups, Iraq did move towards greater state control over the oil. In 1961, Law 80 mandated production-sharing agreements with the Iraqi state for fields not yet under production. In 1964, the Iraq National Oil Company (INOC) was established to develop fields under direct state control. In 1973, the IPC was nationalized outright.
The threat of too much oil coming under the control of a nationalist upstart state was explicitly invoked by Defense Secretary Dick Cheney in the prelude to 1991's Operation Desert Storm: "Iraq controlled 10 percent of the world's reserves prior to the invasion of Kuwait. Once Saddam Hussein took Kuwait, he doubled that to approximately 20 percent.... Once he acquired Kuwait and deployed an army as large as the one he possesses, he was clearly in a position to dictate the future of worldwide energy policy, and that gave him a stranglehold on our economy."
Note that what is critical here is not merely advancing the profits of Western oil companies but a bigger geopolitical question: control of oil as a lever of world power. Muttitt points out that the Pentagon's Defense Energy Support Center (DESC) is the world's single-largest purchaser of oil and describes the fear in high places of a global oil scramble as demand grows in emerging economies. This is a potential threat to U.S. primacy unless global production is boosted and new sources brought online.
Pentagon analyst Zalmay Khalilzad, who had urged for a push on to Baghdad during Operation Desert Storm, later teamed up with Paul Wolfowitz to advocate for a new Iraq adventure to finish the job of toppling Saddam. During the Clinton years, this agenda crystalized around the Project for the New American Century (PNAC) and the notorious "neocons." While protecting Israel is generally portrayed as uppermost on the neocon agenda, Muttitt says little about this. However, the notions of controlling oil and protecting Israel cannot be neatly separated, as oil inherently means the ability to project power — to acquire armaments and to use them in battle. Muttitt does note that Saddam's oil wealth allowed him to offer generous compensation to the families of Palestinian suicide martyrs.
As Washington analysts wound up for act two of the Iraq adventure, the question of oil loomed large. The Center for Strategic and International Studies (CSIS) issued the study "Geopolitics of Energy in the 21st Century," which concluded, "Iraq, subjected to multilateral sanctions, may be constrained from building in a timely way the infrastructure necessary to meet the upward curve in energy demand." A Council on Foreign Relations (CFR) study warned of a "new era of energy scarcity."
When George W. Bush was elected in 2000, his energy-policy document decried that Clinton had been slow to release money Congress had approved for resistance activities in Iraq. Why was this concern raised in a paper on energy rather than foreign policy? Because, it stated, the UN sanctions regime was eroding, and Iraq was becoming "an important ‘swing producer,' with an ability to single-handedly impact and manipulate global markets." Tellingly, Saddam had just signed a deal to open Iraq's oilfields to a foreign company for the first time since 1973: Russia's Lukoil.
After 9/11, when the administration began actively planning for an Iraq invasion, one dissident was State Department analyst Ryan Crocker, whose still-classified memo, "A Perfect Storm," apparently warned of the danger of a sectarian maelstrom. Nonetheless, after Operation Iraqi Freedom was launched in 2003, Crocker and Zalmay Khalilzad were dispatched to Baghdad to help organize the occupation government, while Robert Ebel, who had co-authored the CFR study warning of impending "energy scarcity," became the State Department representative to the occupation authority's Oil and Energy Working Group.
In July 2003, when control was officially turned over to a "governing council" with representatives drawn from Shiites, Sunnis and Kurds, Iraq's Association of Muslim Scholars protested that this was a strategy to "divide Iraq into communal and ethnic groups. It sows the seeds of hostility among the people of this society." And the following year, as armed insurgency gained ground, Gen. Rick Sanchez was explicit about a need to sow, or at least exploit, division: "The danger is, we believe there is a linkage that may be occurring at the very lowest levels between the Sunni and the Shia, and we have to work very hard to ensure that it remains at the tactical level." In Muttitt's interpretation, "Sanchez...warned of the Americans' greatest fear: an Iraq united against the occupation, and which the United States was no longer able to manage politically by playing on communal interests."
This same period saw the beginnings of independent labor organizing at the oil fields and refineries, especially in Basra. In June 2003, when worker protests broke out at Basra oil facilities to decry the fact that they remained idled, U.S. troops were called in to break them up. Occupation-authority administrator Paul Bremer notoriously kept in force the Saddam-era Law 150, which banned trade unions in the public sector, including the oil industry.
Yet there was also a sense that public control of the oil resources was too sacrosanct in Iraq to attack head-on. While Bremer called state control of oil part of Saddam's "vicious brand of socialism" — and The Economist hailed Bremer's restructuring of Iraq a "capitalist's dream" — he left the oil sector untouched. So did the Governing Council that followed him. The oil sector remained under the control of the two state companies, one for the north and one for the south, into which Saddam had divided the old INOC. In 2006, James Baker's Iraq Study Group found: "The president should restate that the United States does not seek to control Iraq's oil."
Amid growing violence, Iraq crept toward ostensible sovereignty. In 2004, the Governing Council turned power over to an interim prime minister, Ayad Allawi; and in 2005, work commenced on a new constitution, with a decentralized federal model adopted. This raised new questions about how oil would be controlled and its profits distributed — especially for the autonomous Kurdish region in the north, which was independent of Baghdad in all but name. This dilemma exposed divisions both within Iraq's new political elite and in Washington's corridors of power.
Veteran U.S. diplomat Peter Galbraith (son of famed economist John Kenneth Galbraith) became an adviser to the Kurdish autonomous government and wrote a book, The End of Iraq, anticipating the division of the country. He simultaneously served as a paid adviser to DNO, a Norwegian oil company that entered into a deal with the Kurdish Regional Government (KRG) without Baghdad's approval. Hunt Oil of Texas (whose CEO, Ray Hunt, was a close friend of George Bush) would later enter into a contract with the KRG. When Baghdad's oil minister, Hussain Shahristani, declared the deal illegal, the KRG's own oil minister admonished him to "shut up."
Sen. Joe Biden sponsored a non-binding "partition bill" that called for the United States to work for a loose confederation in Iraq with a weak central government, if not an actual dismantling of the country. Yet, apparently fearing the chaos of centrifugal forces, the U.S. Treasury Department weighed in on the oil dispute, calling for a "national system which is unequivocally controlled and operated by the federal government."
Even as the insurgency descended into a bloody sectarian war, progressive anti-sectarian forces were mobilizing in the revitalized oil sector's labor movement — in defiance of Law 150 and a climate of terror in which union organizers were targeted for assassination. The Iraqi Federation of Oil Unions (IFOU) led an Anti-Oil-Law Front to oppose the law that would both apportion oil profits on "regional" (meaning sectarian) lines and open the industry to private foreign companies. The Front stated that the law would "abolish sovereignty and hand over the wealth of this generation and the generations to come as a gift to the occupier…. This law in fact destroys the achievements of the Iraqi masses and especially the Law number 80 of 1961 and the nationalization of 1973." More conservative sectors also opposed the law. The Association of Muslim Scholars issued a fatwa declaring that under Islamic law, "water and fire" are the property of the umma (the entire community of Muslims) and therefore cannot be privatized.
The law was never passed. The obstacle was portrayed in the Western press as a deadlock between the representatives of the sectarian and ethnic groups over how to divvy up the oil wealth, and this was doubtless a factor. But the courageous strikes and protests by IFOU and the Anti-Oil-Law Front received virtually no coverage, though they were also doubtless a factor.
When the United States finally started to move towards withdrawal from Iraq, having co-opted much of the Sunni insurgency into a collaborationist militia with offers of guns and autonomy, oil was again a pressing consideration. In 2008, the Pentagon appropriations bill passed by Congress included a clause stating that no funds would be used to establish permanent bases in Iraq or "to exercise United States control of the oil resources of Iraq." Bush approved the bill with a signing statement asserting that he would not be bound by the clause because it would "inhibit the President's ability to carry out his constitutional obligations" to protect national security.
Ibrahim Bahr al-Uloum, who served as Iraq's first post-Saddam oil minister, called the U.S. troop presence a "sort of life insurance...for attracting the international oil companies." And in 2009, Prime Minister Nouri al-Maliki told a group of investors in London: "The development of the private sector is not only an Iraqi desire.... We feel responsibility towards the rest of the world to provide oil and stabilize markets for producers and consumers."
That same year, the Baghdad government finally invited foreign oil companies in. The first contract, for the giant Rumaila field, went to a consortium made up of BP and the China National Petroleum Corporation (CNPC). Later deals opened the Majnoon field to Shell, the Halfaya field to a partnership of the CNPC and Petronas and — finally — the West Qurna I and Zubair fields to a partnership of ExxonMobil and the Italian firm Eni. (Muttitt fails to mention that Exxon, apparently hedging its bets as to Iraq's survival, also entered into an agreement with the KRG.)
This, of course, occasioned more protest. Muhammed Bashar al-Faydi of the Association of Muslim Scholars said: "We consider that such contracts are null and void under the bayonets of occupation." And Iraqi parliamentarian Shatha al-Musawi launched a suit in the country's courts to shut down the contracts, arguing that they had no legal validity. The oil law had never been passed nor the nationalist legislation of the '60s and '70s overturned. The government, in a brazenly cynical move, effectively shut down the case by imposing prohibitive fees for filing it.
Muttitt arguably overstates things here and there. He writes that the United States "created" an "alien" sectarian political discourse in Iraq, but this denies local context and is beyond the reach of any imperial power. He is more on target when he writes that "the West's primordial view of Iraqi society became self-fulfilling." He also implies, in a reversal of the actual facts, that more bombs fell on Iraq in the 2003 air campaign that opened Operation Iraqi Freedom than in 1991's Desert Storm. (In reality, the "shock and awe" campaign was radically downsized at the last minute, probably in deference to world opinion following the winter's global anti-war protests.)
Muttitt also seems to accept the conventional wisdom that the White House sought to keep oil prices low by bringing more Iraqi oil online. He fails to note that expanding production actually requires high prices, to incentivize investors. The runaway price hike that coincided with the worst years of the insurgency may have been — like the sectarian war itself — a case of an international stratagem getting out of control and taking on a life of its own.
Nonetheless, this book is still all too relevant, despite the winding down of the long Iraq adventure; it even includes a chapter on last year's Libya intervention. Muttitt achieves two vital contributions to our understanding of Western dynamics in the Middle East. In demolishing the notion that control of oil was anything less than a central consideration for U.S. military aims in Iraq, he also dispatches the clichéd and oversimplified notions of what a "war for oil" means, knocking down the straw man that it is only or even primarily about corporate profits. The cycle that began with British designs on Iraq in World War I is now nearly a century old. Broaching prescriptions for arresting it, Muttitt echoes the call of the advocacy group Oil Change International for "separation of oil and state." The kind of far-reaching change to the fundamentals of our technology, infrastructure and economy that could make that possible awaits serious discussion.