The author wishes to thank the Middle East & Central Asia Research Center of Ariel University and its staff, for supporting this research.
In 1943, on the eve of Lebanon's independence, the Maronite president, Bishara al-Khuri, and the Sunni prime minister, Riad al-Sulh, formulated the National Pact, which aimed to regulate political life and bridge the different aspirations of the Lebanese communities. The Pact stipulated that power would be shared on a communal basis. Another aspect of the Pact concerned Lebanese foreign policy. Here, too, the Pact attempted to mediate between the aspirations of the Christians and those of the Muslims. For their part, the Christians — especially the Maronites — aimed for separatism, independence from Lebanon's Arab surroundings, and attachment to the West. The Muslims, particularly the Sunnis, wished to connect with the Arab world, especially with Syria. Hence, the Pact stipulated that Lebanon should take the middle road, adhering neither to East nor West. In fact, the Pact dictated a kind of neutrality in foreign affairs, enabling Lebanon to act as a middle man, a connecting factor between opposing elements.
Neutrality has been the core of Lebanon's foreign policy to this day. This policy, however, is not free of problems. Lebanon has had to cope with numerous conflicts, in the face of which it has been difficult to remain neutral. Lebanon has had to find its way and adjust, in the Cold War between the United States and the Soviet Union, and in the Middle East conflict, which to a certain extent is an offshoot of the Cold War.1
One of the fields in which these conflicts were reflected is oil. Although Lebanon was neither an oil producer nor an exporter, it certainly enjoyed oil profits and benefits. From the 1930s, and even more so from the 1940s and 1950s, Lebanon was an oil-transit country. Pipelines connecting the oil fields in Iraq and Saudi Arabia to the Mediterranean terminated in Lebanon; from there, tankers delivered their cargo to the West. Lebanon used some of this oil for its own consumption and also received monthly fees from the oil companies for facilitating the passage of oil. Thus, even in the oil arena, Lebanon was in the middle, connecting between East and West. The laying of oil pipelines on Lebanese territory conformed to the spirit of the provisions of the National Pact.2
But the transit of oil was not problem free. Internationally, the Arab oil-producing countries, along with the progressive Arab transit countries, fought the Western oil companies. This struggle bore the character of a fight against oppression and imperialism, specifically of appropriating rights and profits from the foreign oil companies and restoring them to the local citizens. In the Middle East, there was a clash between progressive and conservative Arab states, the progressives wanting to fight against the West, regardless of the consequences, and the conservatives attempting to maintain good relations with the West.
This article examines the role of Lebanon as an oil-transit country by means of two case studies from the early 1970s, a few years before the Lebanese civil war and the collapse of the state. The first involves the Tapline Affair, in which Syria stopped the flow of oil in the Saudi-Lebanon line in 1970. Lebanon found itself forced to maneuver among Syria, Saudi Arabia, and the American oil company that had built and was operating the line. The second case study involves the nationalization of the Iraqi Petroleum Company (IPC) installations by the Baghdad government in June 1972. Again, Lebanon found itself between East and West, but also having to confront the progressive Arab states. Furthermore, Lebanese free-market principles were at risk, since leftist elements in Lebanon called for the nationalization of IPC installations as well. Its neutrality was put to the test, and Lebanon had to find its way among the various antagonists.
During the late 1960s and the early 1970s, oil was at the heart of the struggles between East and West and within the Middle East, and Lebanon found itself at the center of these conflicts. The antagonists — the oil companies, the producers and neighboring transit countries — wanted Lebanon to pick sides. But adherence to neutrality helped Lebanon to successfully surmount these transit crises.
Moreover, these two case studies occurred while Lebanon was on the verge of civil war. Historians usually depict this period as an era of paralysis, weakness, breakdown and decline, in which Lebanon was a pawn in the hands of others.3 Indeed, the years before the civil war were fraught with challenges that led to the breakdown of the state in the civil war. However, the transit crises demonstrated strength; Lebanon was revealed as assertive and ultimately an arbitrator. This derived, in part, from the Lebanese policy of neutrality.
LEBANON'S FOREIGN POLICY
The 1943 National Pact determined that Lebanon should be in the middle, not exclusively in the Arab East and not solely in the West. This principle is vague; hence it is difficult to define Lebanese foreign policy. Nevertheless, one can point to its three intertwined principles: internal equilibrium, neutrality and economics.
Internal equilibrium: The National Pact, based on the 1932 census, stipulated that leadership positions in Lebanon would be divided among communities: the president would be a Maronite Christian, the prime minister a Sunni Muslim and the speaker of parliament a Shiite Muslim. Christians, particularly the Maronites, were given priority regarding representation in parliament and in the administration.4 However, the system was designed to function well only if none of the parties abused its position and privileges at the expense of the others.5
One way to prevent such abuse was to allocate the high-level positions in the government and administration, especially the top three posts, to prominent leaders who represent their community (or are acceptable to most of the community). A sort of "balance of power" could be created to inhibit the exploitation-authority. Thus, if any political actor attempted to increase his influence, he would encounter resistance from the other two and their respective communities.6
Balance — or its absence — in the domestic arena influences the foreign relations of Lebanon. In order to bolster his position within the internal arena, especially when equilibrium did not exist, a Lebanese power broker would turn to external forces for assistance. Thus, there are two kinds of Lebanese foreign relations, the official and the unofficial: the foreign policy of the state, and the foreign policy of the various power brokers, which changes according to their interests.7
The Lebanese state tries not to get involved in external struggles — such as inter-Arab strife, the Cold War, the Arab-Israeli conflict. If it sided exclusively with any of the adversaries, this would alarm opponents inside Lebanon. From the state's point of view, noninvolvement was and continues to be a guarantee of peace at home. The power brokers, on the other hand, are free of such formal constraints and forge alliances with various external actors to support their local interests. The Sunnite Hariri family can be considered "Saudi," the Shiite Hezbollah "Iranian" and so forth.
These official and unofficial policies frequently contradict each other. For example, while "official" Lebanon distanced itself from the Cold War, elements within the country formed relations with both sides, putting at risk the official policy. Druze leader Kamal Jumblatt, for instance, was a prominent ally of the USSR, and he did make attempts to influence "official" Lebanon to strengthen its ties with the Soviets.8 Another example of this inherent contradiction is the current struggle between Saudi Arabia and Iran. While official Lebanon has been attempting to maintain ties with both sides, nonofficial factors such as Hezbollah are deeply involved in this conflict.9
It can be assumed that if a just power-sharing process prevails, the incentive of local actors to appeal to outside forces for assistance is diminished (but does not disappear entirely) and vice-versa.10 In the case of a just equilibrium, it would be easier for Lebanon to adhere to its neutrality, but what constitutes Lebanese neutrality? The term has changed through the years as a result of wars and other events. Some of its definitions may partially suit Lebanon, such as avoiding participation in wars. Although a state can define itself as neutral, its neutrality is preserved only if other countries recognize it as such.11 Official Lebanon seeks to avoid armed conflicts and thus can be considered a neutral state, but it has been involved in some Middle Eastern conflicts, especially those between Arabs and Israelis. Israel, Syria, the Palestinian organizations and nowadays Hezbollah have not recognized Lebanon as neutral.12
The Cold War created another kind of neutrality, nonalignment. Some countries did not want to be involved and thus chose a different path, not identifying themselves with either side. Nonalignment does not necessarily mean avoiding armed conflicts; it is concerned only with the Cold War: "A non-aligned state would cease to be considered as such once it decided to join one of the two contesting camps in the Cold War."13
Neutralism is another term related to the bipolar world. A neutralist state "decided not to be formally involved in either of the two superpower alliances, and… [to] take aid and support from either or both as offered."14 This approach aimed to preserve a country's interests and enable it to maneuver independently. In contrast to a nonaligned state, a neutralist state could support either side in the Cold War, though not be committed to it.15 According to Samir Anabtawi, "Neutralists have not only sided with this Great Power or that on a variety of issues, but, on occasion, have even gone so far as to condemn certain Great Power activities."16
Official Lebanon could not be considered a nonaligned state; although it did not want to take part in the Cold War, it inclined toward the West. In fact, Lebanese officials estimated that in times of trouble, it would be the West that would save their country.17 Moreover, Lebanese foreign policy should be viewed in light of the various Middle Eastern struggles. Although Lebanon had no desire to take part in them, it is not nonaligned but a kind of neutralist state. For example, it supports the Arab world in the Arab-Israeli conflict.
Two derivatives of the term neutralism can define Lebanese foreign policy in both the international arena and Middle Eastern struggles: American or partial neutralism, and positive neutralism. American or partial neutralism is related to U.S. president Franklin Roosevelt and American foreign policy in the initial stages of World War II. According to Rami Ginat,
Roosevelt considered the U.S. a non-belligerent state, which, however, should be allowed to support one of the belligerent states without being a participant in any fighting. The underlying theme behind this law was to help Britain's military effort without being involved directly in the war: hence, a sort of neutrality.18
This kind of neutralism describes Lebanon's conduct in the Arab-Israeli conflict. Officially, Lebanon is nonbelligerent, but it supports the Arab countries' effort against Israel.19
Positive neutralism is yet another manner of not engaging in the world's conflicts. A positive neutralist state does not remain indifferent but acts to ease tensions and prevent wars. The "positivist" state can protect its independence and try to achieve a durable peace.20 This kind of neutralism seems to fit Lebanon, which positions itself in the middle as a kind of arbitrator. It attempted to ease tensions within the Arab world, between conservative and progressive states, and between the Arab world and the West.
For example, during the early 1970s Lebanon tried to mediate between two progressive Arab rivals, Syria and Iraq. In this case, the Lebanese efforts failed,21 though there were some successes. Owing to Lebanese mediation, Damascus and Tunis resumed their diplomatic relations in 1971 after six years of disconnection.22 In a later period, Rafiq al-Hariri "used his global influence to help smooth Bashar [al-Assad]'s reception with world leaders," both Western and Arab.23 This positive neutralism also aimed to guarantee Lebanese economic interests.
Economic Considerations: Lebanon's economy and foreign policy go hand in hand. Since there are few natural resources in Lebanon, it has to rely on services and commerce, both oriented toward the Arab world and the West. It has no other options.24 Lebanon encourages foreign investment, whether Arab or international. Its economic system is based on the laissez-faire principle: private ownership and a free market with minimal regulations and nationalizations. In order to maintain its reputation as an open economic center, Lebanon must conform to positive neutralism. It maintained commercial relations with both the USSR and the United States, and with both conservative and progressive Arab countries.25
In summary, these three principles — internal equilibrium, positive neutralism and economic considerations — reflect Lebanon's delicate position vis-à-vis the Arab and international arenas. It must adhere to its positive neutralism; if it deviates from this policy, it will risk internal economic and political catastrophe. These three factors affected the Lebanese handling of the Tapline and IPC transit crises. In fact, in the case studies, these factors were bound together: internal equilibrium affected Lebanon's positive neutralism, which affected the economic situation. But first, some background on oil pipelines and transit countries is required.
THE POWER OF TRANSIT COUNTRIES
In the last two decades, the subject of energy transport through overland pipelines has returned to center stage. Before that, it was customary to transport crude oil through pipelines connecting the oil fields and terminals. Now it is mostly gas that runs through the pipes. Although at first glance, overland transportation seems to be efficient and convenient, it is not without problems. The transport of energy relies on the permission of the countries through which the pipes run. In return for this permission, the transit countries receive fees and some of the energy for their own consumption.26
Although, on the face of it, the role of a transit country is merely to provide the space through which pipelines run, a closer look reveals that a transit country may assume a much more active role in the delivery process. In fact, after the pipelines are laid, the energy companies, the producers and the consumers all depend on the goodwill of the transit country. According to Ekpen James Omonbude, "The transit country can disrupt the pipeline during its operation simply because it can."27
Hence, the energy companies must take into account their needs and demands. For example, every so often, transit countries attempt to renegotiate the terms of payment and collect increased fees. Obviously, the transit country has the power to shut down the energy flow if its demands are not met. On the other hand, if the energy company decides to increase fees to one transit country, it usually has to pay the same tariffs to the other transit countries on the same line.28
It is customary to depict transit countries as either good or bad, depending on their conduct toward the energy companies and the oil market. A "good" transit country facilitates the operation of the pipelines, whereas a "bad" one undermines it in order to gain some advantage over the energy company or in the oil market.29 Dependence upon transit states notwithstanding, energy companies and consumers do have some means of protecting themselves. For instance, if the transit country is entrenched in the world economic market, bad behavior can tarnish its reputation and turn off investors. Thus, the threat of an economic boycott can deter the transit country. Another option for moderating the transit country's conduct is its dependency on the oil it receives from the pipeline. If this is the main source of local consumption, the transit country would likely avoid the risk of jeopardizing its own energy supply. According to Paul Stevens, throughout history the energy companies have tried to refrain from applying penalties, preferring to negotiate with bad transit countries. For this purpose, the parties in the conflict needed a reliable arbitrator, acceptable to all sides.30
Two pipelines used to cross the Arab Middle East: The Trans-Arabian Pipeline (Tapline) and the IPC. Tapline, owned by the Arabian American Oil Company (ARAMCO), had a pipeline that connected Saudi Arabia to the Mediterranean. Its point of origin was Dhahran in the Persian Gulf, from which it ran through Jordan and Syria, ending at the Zaharani refinery, south of Sidon in Lebanon. The line was laid during the 1940s and became active in 1950. According to Asher Kaufman, "The maximum transferring capacity of the pipeline was 480,000 barrels per day, and at its peak Tapline transported about 30 percent of the total Saudi oil production."31
In 1934, the British-owned Iraqi Petroleum Company (IPC), laid a pipeline connecting Kirkuk (Iraq), Tripoli (Lebanon) and Banias (Syria). The company established refineries in both Banias and Tripoli. Later, the company added two more pipelines, running parallel to the 1934 line, in order to increase the oil-flow capacity — one to Tripoli in 1946 and one to Banias in 1952. According to Michael Brown's estimations, between January 1971 and April 1972, IPC's output was 1.1 million barrels a day.32
Since the pipelines were laid, Arab transit countries have frequently demanded increased fees; in fact, the oil companies had to renegotiate their agreements with the transit countries every few years. In some cases, the transit countries shut the pipelines down until their demands were met.33 It should be mentioned that the importance of both pipes became obvious after the June 1967 war and the closure of the Suez Canal,34 as the increased dependence upon these pipelines amplified the power of the transit countries.
Lebanon, with its policy of positive neutralism, was a "good" or even ideal transit country. It was heavily dependent on the pipelines for its own local consumption and careful not to harm its commercial reputation. More than that, Lebanon maintained good relations with both Western and Arab countries. Even though, over the years, Lebanon — like other transit countries — had made demands of the oil companies, it generally preferred to negotiate for improved terms rather than sabotage the pipelines or block the oil flow.35 Lebanon, with its warm relations with both East and West, could act in times of crisis as a reliable arbitrator. It was an ideal transit country because, by nature, it was in the middle.
CASE STUDIES: TAPLINE AND IPC
When the two transit crises occurred, between 1970 and 1973, Lebanon was experiencing what may be termed a brief golden era. In August 1970, its parliament elected the Maronite leader Suleiman Frangieh as president. Frangieh was a strong leader from north Lebanon who was accepted by most of the Maronite community. The new president nominated the Sunni leader Saeb Salam, from Beirut, as prime minister. Salam was one of the strongest Sunni leaders in Lebanon. Alongside these leaders there was also a strong Shiite speaker of parliament, Kamil al-Asaad from south Lebanon. The three were members of the central party in the parliament and now served in the highest political posts. A new internal equilibrium was created.36
The internal balance of power affected Lebanon's foreign policy. On December 8, 1970, the new foreign minister, Khalil Abou Hamad, delineated the guidelines of the new regime. Abou Hamad declared that Lebanon supported the United Nations and should not align itself with either side in the Cold War. Lebanon, according to Abou Hamad, should strengthen its ties with all countries without exception,37 especially with Arab countries, in the spirit of brotherhood.38 As mentioned above, internal and external policies are bound together, and with the new balanced regime, it was easier for Lebanon to conform to its positive neutralism.39 In fact, both its internal and external equilibrium enabled Lebanon to deal successfully with the looming transit crises.
THE TAPLINE AFFAIR
On May 3, 1970, a Syrian bulldozer hit the Tapline pipe near Daraa, south of Damascus, shutting down the oil flow. When the technicians tried to repair the damage, Syria prevented their access to the area. It is possible that Syria intentionally damaged the pipeline in protest of the favorable American policy toward Israel.40 It is also likely that economics lay behind Syria's act. In fact, in order to let Tapline technicians access the damaged section, Syria demanded increased fees and even claimed that the Tapline Company owed Damascus money. In order to realize its interests, Syria did not hesitate to shut down the oil line, clearly demonstrating the potential power of a transit country.41
The Tapline Affair involved both a struggle between East and West (Syria and the United States) and an intra-Arab struggle between conservative and progressive Arab countries (Saudi Arabia and Syria). Syria had strained relations with both Saudi Arabia and the United States. In 1966, a faction of the Baath party had seized control in Syria. This faction, called the "Neo-Baath," considered itself a socialist-revolutionary party and was reluctant to cooperate with either conservative Arab countries, such as Lebanon, Jordan and Saudi Arabia, or with the imperialist West. The Neo-Baath considered the monarchy of Saudi Arabia to be a regressive regime, especially in its leaning toward the Western countries. In fact, Syria had attempted to undermine the Saudi regime by spreading anti-Saudi propaganda, supporting opposition groups and making plans to assassinate King Faisal in 1966. The socialist ideology of the Neo-Baath led it to lean toward the Soviet Union and alienate itself from Western influence.42
As a result of the Syrian refusal to repair the pipeline, Lebanese interests were in danger. As the Tapline delivered one-third of Lebanese oil consumption, Lebanon was faced with the risk of an energy shortage. Moreover, shutting down the pipeline was costing Lebanon $10,000 per day in lost commissions. The Tapline Company also declared that, should the pipeline remain shut, it would have to dismiss its 281 Lebanese employees. This alarmed the Lebanese workers, prompting President Frangieh to declare that, in case the crisis was not solved swiftly, he would personally intervene on behalf of the workers. Since Lebanon was affected by the Tapline Affair, it opted for a quick solution.43
The Tapline Affair threatened Lebanon's international position. On the one hand, Lebanon relied on Syria's good will for the resumption of the oil flow, since the pipeline went through Syria's territory before entering Lebanon. Moreover, Lebanon had no wish to offend Syria, which could seal their common border and paralyze Lebanon's commercial activity. Hence, it could not overtly oppose Syria. On the other hand, Lebanon did not wish to weaken its relations with Western countries, and therefore could not alienate the West.
The way Lebanon handled this impasse should be viewed in light of its positive neutralist policy: to "take a positive stand to ease tensions in order to, first, protect its own independence and sovereignty and, second, act for the restoration of a durable peace"44 — in this case, an "economic" peace. Hence, Lebanon placed itself firmly in the middle. It joined forces with Damascus and its struggle against the Tapline Company; its dependence on Syria made it hard to oppose it publicly. At the same time, Lebanon sought to persuade Damascus to be flexible in its negotiations with the Tapline Company in order to put an end to the crisis.45
The Tapline Company was happy to use the arbitration skills of Lebanon and its Arab connections as well as its eagerness to solve the conflict, especially as both Tapline and Lebanon saw eye to eye regarding the need for a quick solution. The resolution of the Tapline crisis involved patching up the differences between Syria, the Arab world and the West. Lebanon even managed to iron out the differences between the Tapline Company and Syria. Thus, the mediation efforts of President Frangieh and the visit to Syria of Prime Minister Salam in December 1970 paved the way for a friendly visit to Damascus by the head of the Tapline Company, William Chandler.46
Tapline and Syria resumed their negotiations, and quickly enough, in January 1971, Syria permitted Tapline workers to repair the damaged pipeline and reopen it. Syria and Tapline signed a new agreement in which the company raised the annual commission from $4.5 million to $8.5 million. Furthermore, the company compensated Syria for the years in which it had paid lower tariffs by disbursing an additional lump sum of $9 million. Saudi Arabia expressed its gratitude for Lebanon's mediating role and bringing the crisis to a resolution.47
The Tapline Affair illustrates Lebanon's middle position between East and West and within the Arab world. Lebanon served all sides, especially progressive Syria, which surely benefited from the good relations Lebanon had with the West. The Tapline Company, for its part, took advantage of Lebanon's position in order to solve the crisis. The Tapline Affair demonstrates the benefit of positive neutralism. Thanks to this policy, Lebanon could mediate between the embattled sides, assuming the role of peacemaker.
THE IPC AFFAIR
Relations between Iraq and the IPC had been strained since 1958, after the Qassem coup that led to the downfall of the Hashemite regime. Under Hashemite rule, Iraq had been ready to come to terms with the IPC, but the new Iraqi government demanded an increase in its share of the oil profits. The struggle between the two sides resulted in a unilateral move by the Iraqi government: On June 1, 1972, it nationalized the IPC installations in its territories. The pipeline was shut down until Iraq reached an agreement with the IPC and the transit countries of Syria and Lebanon. Naturally, Iraq wanted to resume the oil flow as soon as possible. Both Syria and Lebanon had to decide whether to nationalize the IPC properties in their territories or not. 48
As a result of Iraq's move, Syria decided to nationalize IPC's properties in its territories, the pipelines and the Banias refinery. Damascus congratulated the Iraqi people for restoring their national resources to their rightful owners. Other Arab states, such as Egypt, Jordan, Algeria and Kuwait, expressed their support for Iraq and Syria. Kuwait even called on the Arab oil-producing countries to assist Iraq and refrain from increasing oil exports to compensate for the shortage in production, in order not to gain from Iraq's bold move. An Arab front supporting Iraq was formed.49
Lebanon faced a commercial crisis stemming from its international position. If it were to follow in the footsteps of other Arab countries and nationalize IPC's properties, it would contradict its principle of laissez-faire and harm its reputation. Western companies would abstain from investing in Lebanon. However, should it decide not to nationalize IPC, it would antagonize the Arab world, especially Iraq, the main provider of Lebanon's energy needs. Baghdad was eager to resume the oil flow, as were leftist elements within Lebanon. Parties, such as the Progressive Socialist Party of Druze leader Kamal Jumblatt, the Lebanese Baath party and the Nasserist parties praised the Iraqi-Syrian move and called on Lebanon to act in the same manner.50
As with the Tapline Affair, Lebanon tried to adhere to its positive neutralism. Initially, Prime Minister Saeb Salam declared that in every future dispute between IPC and Iraq, Lebanon would back the Iraqi regime. However, he also declared that Lebanon did not intend to nationalize IPC. As a way to resolve the crisis, Lebanon suggested buying IPC's properties in its territories, but the IPC refused to sell its installations. There were other suggestions, such as establishing a parallel pipeline that would transfer the Iraqi oil to Tripoli, thus avoiding the question of ownership, but these proposals were rejected by the Lebanese government. The oil was still under IPC ownership, and this would inevitably lead to a crisis with the company. In fact, Lebanon also suggested leasing the installations, but both Iraq and IPC refused. Lebanon made several other suggestions in an attempt to satisfy both the producers and the oil company, but the latter rejected them.51 It appears that Lebanon did not want to deviate from its positive neutralism; soon, however, Lebanon would pay a high price for this position.
Iraq and Syria reached an agreement in January 1973 to resume the oil flow through the Banias terminal, and in return Iraq committed to paying Syria increased royalties. Now the pipeline would operate only through Syria. Lebanon wished to achieve a similar agreement, but its offers to both Iraq and IPC were rejected. Beirut suggested yet another solution, in which it would temporarily take over IPC's assets in its territories and pay compensation for using its installations. Iraq agreed in principle to the move, which allowed Lebanon to control IPC's installation until the company and Iraq reached a final agreement. Although this solution could have satisfied Lebanon, Iraq, IPC and the consumers, Lebanon was hesitant, fearing its implications. This move, although temporary, could be viewed by other countries as an attempted confiscation, casting a shadow over Lebanon's reputation.52
Iraq and Lebanon negotiated the terms for resuming the oil flow in Beirut from the second half of February until March 1973. Lebanon demanded the same rates Iraq gave Syria, and the Iraqi government accepted this. However, when both sides were on the verge of an agreement, the Iraqi delegation returned to Baghdad for final consultations. It turned out that, while the Lebanese and Iraqi delegations were in the midst of negotiating, the Iraqi government and IPC concluded a new agreement. It was stipulated that all IPC assets would be under Iraqi ownership, including the Lebanese pipelines and the Tripoli refinery, contingent upon Lebanon's consent.53
Although the agreement required Lebanon's approval, if Beirut accepted this new deal it would all be a loss. The installations would be under Iraqi ownership, but Lebanon would receive no compensation.54 But if Lebanon rejected the new agreement, it would probably encounter internal and external pressure to reconsider. In addition, its reputation, both in the West and the Arab world, would be damaged. It seemed to be a lose-lose situation. Moreover, while in its negotiations with Iraq, Lebanon had attempted to guarantee IPC's interests, the oil company did not handle the issue in the same manner.
Left with no other choice, and as a way to safeguard its own interests, Lebanon announced it was taking over IPC's installations in its territories. As an independent actor, Lebanon signed a new agreement with Iraq on March 5, 1973, and declared it would not compensate the IPC for its losses — though IPC's workers would not be harmed. This move was a volte-face from Lebanon's positive neutralism and the laissez-faire principle. It seems IPC and Iraq considered Lebanon the weak link in the transit chain, a pawn that could be moved against its will. As such, they had ignored its interests, forcing Lebanon to replace positive neutralism with a more active position.55
This active step notwithstanding, Lebanon attempted to preserve some aspects of its positive neutralism. It maintained cordial relations with IPC and made clear that it preferred to negotiate with the British company rather than take over the properties unilaterally. Furthermore, Lebanon paid IPC part of the payment it received from Iraq. In an attempt to preserve its relations with foreign companies, Lebanon refrained from using the word "nationalization" to describe its course of action. Rather, Beirut declared that IPC had violated the 1931 mutual agreement, according to whose terms, Lebanon was bound to IPC as long as it had an oil concession. Now, however, the terms had changed, and IPC had sold its concession to Iraq. In accordance with the 1931 agreement, Lebanon could appropriate the company's properties.56
This action outraged both Iraq and IPC. Despite signing an agreement with Lebanon, Iraq was not happy with the possibility of Lebanon's taking over IPC's properties, since it wanted ownership of these installations for itself. A few days after Lebanon took over IPC's properties, Iraq banned the import of Lebanese products. Although Iraq declared that the ban was intended to bolster its own industry and agriculture, this move was a consequence of Lebanon's position toward the IPC affair.57 According to Iraq, during the negotiations, Lebanon had "preferred the interests of foreign monopolistic companies over the interests of brotherly Iraq."58
IPC rejected Lebanon's refusal to provide compensation, calling for international arbitration. It also threatened that the unresolved affair would lead other foreign companies to pull their investments out of Lebanon for fear of nationalization. The British embassy in Beirut even fanned rumors that foreign companies were abandoning Lebanon.59 It appears that both IPC and Iraq preferred a submissive Lebanon that would acquiesce to their dictates.
Neither Iraq nor IPC understood Lebanon's delicate position. Moreover, they ignored Lebanon's efforts to resolve the dispute peacefully. While Lebanon was trying hard to adhere to positive neutrality, Iraq and IPC wanted it to take a side — anathema to Lebanese foreign policy. Lebanon did not abide by its policy blindly, but when its economic interests were threatened, it had to act decisively. Beirut was able to make a decisive move due to the state's internal equilibrium. Although there were Lebanese voices calling for the government to favor Iraq, they were muted in the face of the internal balance. The IPC affair demonstrates Lebanon's inner power.
CONCLUSION
Since the time of the Tapline and IPC affairs, much water has flowed under the bridge. Lebanon collapsed into a 15-year civil war and recovered from it. The Cold War ended but a new one erupted, between Saudi Arabia and Iran. The Middle East began to change during the so-called Arab spring. Circumstances have shifted, but the principles remain solid: Lebanon cannot lean too far toward either side, whether East or West, progressive or conservative, Sunni or Shiite. It should always maintain a middle position, as an arbitrator, a link, a bridge between regions, a transit country. Outsiders should accept Lebanon as a balancer and not attempt to push it into a corner.
1 Paul Salem, "Reflections on Lebanon's Foreign Policy," Peace for Lebanon? From War to Reconstruction, ed. Deirdre Collings (Lynne Rienner Publishers, 1994), 71-72. By the term "conservative states," we mean mainly monarchical Arab countries that leaned toward the West. By "progressive states," we mean republics with a socialist agenda and an affinity toward the USSR. Both conservative and progressives fought each other and attempted to undermine each other's regimes.
2 Zachary D. Cuyler, "Tapline, Welfare Capitalism, and Mass Mobilization in Lebanon, 1950-1964," Working for Oil: Comparative Social Histories of Labor in the Global Oil Industry, eds. Touraj Atabaki, Elisabetta Bini, and Kaveh Ehsani (Palgrave Macmillan, 2018), 341.
3 One can trace these descriptions back to the academic books and articles written after the outbreak of the civil war. For example, Kamal S. Salibi, Crossroads to Civil War, Lebanon 1958-1975 (1976), or Farid El-Khazen, The Breakdown of the State in Lebanon, 1967-1976 (2000). See also Itamar Rabinovich, "The Limits of Military Power: Syria's Role," Eds. P. Edward Haley and Lewis W. Snider, Lebanon in Crisis – Participants and Issues (Syracuse University Press, 1979), 55-73.
4 The Taif Agreement that ended the Lebanese civil war inserted some changes to the allocation of power. Some of the Maronite president's authorities were given to the Sunnite prime minister and the Shiite speaker of parliament. Also, the Taif Agreement stipulated equality between Muslims and Christians within the Lebanese parliament.
5 Eyal Zisser, Lebanon: The Challenge of Independence (I.B. Tauris, 2000), 57-67; Wade R. Goria, Sovereignty and Leadership in Lebanon 1943-1976 (Ithaca Press, 1985), 15; Theodor Hanf, Coexistence in Wartime Lebanon: Decline of a State and Rise of a Nation (I.B. Tauris, 1993), 15; and El-Khazen, The Breakdown of the State in Lebanon, 205-6.
6 Eyal Zisser, Lebanon, Blood in the Cedars: From the Civil War to the Second Lebanon War (Hakibutz Hameuchad, 2009), 40 (Hebrew).
7 Salem, "Reflections on Lebanon's Foreign Policy," 72.
8 National Archive, College Park, Maryland (NA), Record Group (RG) 59, Box 2448/F. POL LEB-USSR 4-28-70: "Soviet Influence in Lebanon", April 28, 1970.
9 Bassel F. Salloukh, "The Syrian War: Spillover Effects on Lebanon," Middle East Policy 24, no. 1 (2017): 62-78; and Kota Suechika, "Strategies, Dynamics, and Outcomes of Hezbollah's Military Intervention in the Syrian Conflict," Asian Journal of Middle Eastern and Islamic Studies 12, no. 1 (2018): 89-98.
10 Salem, "Reflections on Lebanon's Foreign Policy," 72-3.
11 Efraim Karsh, Neutrality and Small States (Routledge, 1988), 13-19.
12 Bassel F. Salloukh, "The Arab Uprisings and the Geopolitics of the Middle East," International Spectator 48, no. 2 (2013): 32-46; and Salloukh, "The Syrian War," 68-69.
13 Rami Ginat, Syria and the Doctrine of Arab Neutralism: From Independence to Dependence (Sussex Academic Press, 2005), 2.
14 Julius Gould & William L. Kolb, eds., A Dictionary of the Social Sciences (Tavistock, 1964), 233.
15 Ginat, Syria and the Doctrine of Arab Neutralism, 2-3.
16 Samir N. Anabtawi, "Neutralists and Neutralism," Journal of Politics 27, no. 2 (1965): 357. It should be mentioned that some researchers do not distinguish between nonalignment and neutralism and consider them synonymous. See, for example, Karsh, Neutrality and Small States, 27-29.
17 NA, RG 59, Box 2448/F. POL LEB-USSR 4-28-70: "USSR and Other Communist Countries Enjoying New Respectability in Lebanon", April 2, 1971.
18 Ginat, Syria and the Doctrine of Arab Neutralism, 4.
19 See, for example, the testimony of Abd al-Halim Khaddam, who served as the Syrian foreign minister during the 1970s, concerning Lebanon's aid to Syria during the October 1973 war: Karim Baqraduni, al-Salam al-Mafqud:ʿAhed 'Aliyas Sarkis 1976–1982 (ber al-Sharq lilmanshurat, 1984), 220-221 (Arabic).
20 Ginat, Syria and the Doctrine of Arab Neutralism, 4.
21 "Mubahathat Najiha bayna al-Janibayn al-Lubanai wal-ʿIraqi fi Baghdad," [successful talks between Lebanon and Iraq in Baghdad] and al-Jarida (Beirut), February 18, 1971; "Lubnan Yasʿi ʻIla Tawfiq bayna Suriya wal-ʿIraq," [Lebanon will try to lead to an understanding between Syria and Iraq] al-Nahar, January 29, 1971.
22 "Suriya Tastaanf al-Alaqat ma Tunis baad Najah Masaa Qam Bihi Lubnan," [Syria resumed its relations with Tunisia as a result of a Lebanese effort] al-Nahar, February 16, 1971.
23 Nicholas Blanford, Killing Mr. Lebanon: The Assassination of Rafik Hariri and Its Impact on the Middle East (I.B. Tauris, 2006), 75-76.
24 NA, RG 59, Box 763/F. E 2-2 LEB: "Economic Trends in Lebanon and their Implications for the Unites States," November 20, 1970.
25 Public Record Office, Kew, London (PRO), Foreign and Commonwealth Office (FCO) 17/1110: telegram from P. Sadgrove, the British embassy Beirut, to C.W. Long, Near Eastern Department, FCO, July 18, 1970; NA, RG 59, Box 763/F. E 2-2 LEB: "Economic Review No. 20: Lebanon, February 1-28, 1971," April 1, 1971.
26 Ekpen James Omonbude, Cross-Border Oil and Gas Pipelines and the Role of the Transit Country: Economics, Challenges, and Solutions (Palgrave Macmillan, 2012), 1-4; S. Frederick Starr, Thomas R. Stauffer, and Julia Nanay, "Symposium — Caspian Oil: Pipelines and Politics," Middle East Policy 5, no. 4 (1998): 27-50; Asher Kaufman, "Between Permeable and Sealed Borders: The Trans-Arabian Pipeline and the Arab-Israeli Conflict," International Journal of Middle East Studies 46, no. 1 (2014): 102; and PRO, FCO 17/1112: "The Arab World: Lebanon Is Seeking to Amend Economic Accord with Syria; Transit, Oil Issues to be Discussed," December 10, 1970.
27 Ekpen J. Omonbude, "The Transit Oil and Gas Pipeline and the Role of Bargaining: A Non-Technical Discussion," Energy Policy 35 (2007): 6193. The italics are in the original text.
28 See, for example, Paul Stevens, "Pipelines or Pipe Dreams? Lessons from the History of Arab Transit Pipelines," Middle East Journal 54, no. 2 (2000): 227.
29 Paul Stevens, Transit Troubles: Pipelines as a Source of Problems (Chatham House, 2009), 11.
30 Ibid, 19-28.
31 Kaufman, "Between Permeable and Sealed Borders," 97-100; and Stevens, "Pipelines or Pipe Dreams?, 227.
32 Michael E. Brown, "The Nationalization of the Iraqi Petroleum Company," International Journal of Middle Eastern Studies 10, no. 1(1979): 107-109, 119.
33 Stevens, "Pipelines or Pipe Dreams?," 227; and Benjamin Shwadran, The Middle East, Oil and the Great Powers (Israel Universities Press, 1973) 449-476.
34 Kaufman, "Between Permeable and Sealed Borders," 104.
35 Shwadran, The Middle East, Oil and the Great Powers, 461-465; NA, RG 59, Box 763/E 2-2 LEB: "Economic Trends in Lebanon and Their Implications for the United States," June 16, 1972; NA, RG 59, Box 763/E 2-2 LEB: "Economic Review No. 37: Lebanon, July 1-31, 1972," October 13, 1972; "Salam Yuwaqaʿ al-'Itifaq al-Jadid maʿ al-Tablain," [Salam will sign the new agreement with Tapline.] al-Nahar (Beirut), April 16, 1971.
36 NA, RG 59, Box 2447/F. POL 15-2 LEB 8-11-70: "Shifts in Lebanese Political Alignments," January 4, 1971.
37 It should be mentioned that, concerning Israel, Lebanon adhered to its partial neutralism. On the one hand, it supported the Arab struggle against Israel, but on the other, it considered itself obliged to the 1949 Armistice Agreement.
38 "Abu Hamad Yuhadid Mabadaa al-Siyasa al-Kharijiya fi al-Ahed al-Jadid," al-Nahar, [Abu-Hamad delineates the new regime's foreign policy principles] December 9, 1970.
39 Dan Naor, "The Quest for a Balance of Power in Lebanon during Suleiman Frangieh's Presidency, 1970-1976," Middle Eastern Studies 49, no. 6 (2013): 997-1000.
40 Kaufman, "Between Permeable and Sealed Borders," 108.
41 "Syria Tabdaʾ Harb al-Naft al-Thaniya," [Syria starts the second oil war] al-Nahar, July 4, 1970; Joseph Mann, "Opposition in Saudi Arabia, 1964-1970" (PhD thesis, Bar-Ilan University, 2004), 274-275 (Hebrew).
42 Ibid, 84-106; Ahron Neumark, "The Neo-Baʿth Regime in Syria, 1966-1970: Politics and Policy" (PhD thesis, Bar-Ilan University, 2002), 19-34 (Hebrew); PRO, FCO 17/1350: "Summary Report on a Visit to Damascus May 28 to June 2, 1970," June 25, 1970.
43 NA, RG 59, Box 763/F. E 2-2 LEB: "Economic Review No. 10: Lebanon, April 1-30, 1970," May 21, 1970; NA, RG 59, Box 763/F. E 2-2 LEB A-319: "Economic Review No. 12: Lebanon, June 1-30, 1970," July 16, 1970; NA, RG 59, Box 2446 POL-7 LEB 1-1-70, A-56: "Saudi-Lebanese Relations," April 15, 1971; "Salam Yutaṣal bi-Khalifawi: Balna 'Indkum," [Salam calls al-Khalifawi: our thoughts are with you] al-Nahar, August 15, 1970; "al-Raʾis Yutadakhal Shakhṣiya Litajmid Tadabir Ṣaraf Mustakhdamin al-Tablain," [the president personally intervened for the Tapline employees] al-Nahar, October 12, 1970; "Abu-Hamad Qabil Sifrihi ila Baris," [Abu Hamad before going to Paris] al-Nahar, November 3, 1970.
44 Ginat, Syria and the Doctrine of Arab Neutralism, 4.
45 "Al-Saʿudia La Tajad Mubarar li-Manaʿ 'Iṣlah al-Anabib al-Tablaine fi al-Araḍi al-Suriya," [Saudi Arabia does not find any justification for not repairing the pipeline in Syria] al-Nahar, July 2, 1970; "Lubnan Yʿaraṣ 'Ala al-Saʿudiya wal-Suriya Hala Wasta lil-Mushkila Khat al-Tablaine," [Lebanon presents Saudi and Syria with a middle way for solving the pipeline problem] al-Nahar, September 28, 1970.
46 NA, RG 59, Box 2446 POL-7 LEB 1-1-70: "Visit of Lebanese Foreign Minister," March 5, 1971.
47 NA, RG 59, Box 2446 POL-7 LEB 1-1-70: "Saudi-Lebanese Relations," April 15, 1971; "Tapline, Syria Accord Boosts Royalties by $ 4 M," Daily Star (Beirut), February 2, 1971; "Franjiya wal-Malik Fayṣal Yubahathan al-Yawm fi al-'Alaqat al-Thinaʾiya wal-Maṣfa wal-Waḍaʿ al-'Arabi," [Frangieh and King Faisal will discuss today the bilateral relations, the refinery and the status of the Arab world] al-Nahar, September 27, 1971; "Lebanon, Tapline Discuss Royalties," Daily Star, March 5, 1971; "Lubnan Yaṭlab min al-Tablayne Ziyada Hiṣatihi Arbaʿ Malayin Dular Sanawiya," [Lebanon demands Tapline increase its annual share to 4 million dollars] al-Nahar, March 5, 1971; and Shwadran, The Middle East, Oil and the Great Powers, 469. The Syria-Tapline agreement also led to a revised agreement with Lebanon, under similar conditions. It should be emphasized that Lebanon and Tapline renegotiated their agreement while oil was already flowing in the pipelines. Namely, Lebanon wished first to be back in business and only then to renegotiate new terms.
48 Brown, "The Nationalization," 107-108; and Shwadran, The Middle East, Oil and the Great Powers, 267-282.
49 "al-Kuwait Tuʾid Khatwa al- ' Iraq," [Kuwait supports the Iraqi move] al-Nahar, June 3, 1972; "al-Kuwait Tad'u al-Duwal al-Muntajah lil-Nafṭ 'ila Da'm al-' Iraq ba' d Ta'mim al-Ay. Bi. Si.," [Kuwait calls for the producing countries to support Iraq] al-Nahar, June 4, 1972
50 "Lubnan Yuwajaha al-Taṭawarat al-Batrouliya," [Lebanon faces oil developments] al-Nahar, June 3, 1972.
51 Ibid; "Hilu Denies IPC Interests to be Nationalized," Damascus MENA (Middle East News Agency) 1640 GMT, June 6, 1972, Daily Report (DR), June 7, 1972, 111 (5), E1; "Lebanon Considering Seizure of IPC Pipeline," Baghdad INA (Iraqi News Agency) 1205 GMT, August 21, 1972, DR, August 22, 1972, 164 (5), E1; "'Itifaq Lubnan wal-ʿIraq 'ala Ḍakh al-Nafṭ," [Iraqi Lebanese agreement on oil pumping] al-Nahar, March 2, 1973.
52 "Lebanon Seeks Reactivation of Tripoli Oil Terminal," Daily Star, February 18, 1973; "Flow of Iraqi Oil Ensured Across Lebanese Territory," Daily Star, February 21, 1973; "Hamla Diblumasiya Tasbaq Qarar al-Hukuma Muṣadara 'Anabib al-Ay.Bi.SI Muʾaqata," [A diplomacy effort preceded the government decision to temporarily expropriate IPC pipelnes] al-Ṣayad (Beirut), No. 1483, February 15-22, 1973.
53 "Yawm Batruli 'Akhar Hafil fi al-Qiṣr," [another "oil-day" in the palace] al-Nahar, March 1, 1973; "Lubnan Yuqarar Tamalk Manshaʾat al-Iy. Bi. Si." [Lebanon decides to take control of IPC installations], al-Nahar, March 3, 1973; and "Lebanon Surprised over Failure of Iraqis to Resume Oil Talks," Daily Star, March 4, 1973.
54 PRO, FCO 93/108: "Record of a meeting held in Mr Parsons' office at 4.30 PM on Friday 2 March 1973," March 2, 1973. Lebanon did not want an Iraqi ownership. One of the reasons for this refusal was Lebanon's fear of Iraq's Baʿath influence on the Sunnite population in Tripoli.
55 "Lubnan Yuqarar Tamalk Manshaʾat al-'Iy. Bi. Si.", [Lebanon decides to take control over IPC installations] al-Nahar, March 3, 1973; "Lebanon Takes Over IPC," Daily Star, March 6, 1973; PRO, FCO 93/108: "Saʾib Salam's Interview on IPC Installations," March 9, 1973; PRO, FCO 93/108: "Record of a meeting held in Mr Parsons' office at 4.30 PM on Friday 2 March 1973," March 2, 1973; PRO, FCO 93/108: "The IPC and the Lebanon," March 8, 1973; "Lebanon Takeover of IPC: Motivation", Wikileaks, U.S. Embassy Beirut, March 15, 1973, https://wikileaks.org/plusd/cables/1973BEIRUT03016_b.html (accessed on March 20, 2018).
56 "Tajmid al-Mufawaṣat bayna Lubnan waʿIraq," [the Lebanese-Iraq negotiations were stopped] al-Nahar, March 3, 1973; PRO, FCO 93/108: "IPC," telegram No 159, March 7, 1973; PRO, FCO 93/108: "IPC/Lebanon," March 14, 1973; PRO, FCO 93/108: "IPC," telegram No. 210, March 20, 1973; PRO, FCO 93/108: "The Lebanese Ambassador's Call on the Minister of State: Your Minute to Mr Craig of 22 March," March 22, 1973; PRO, FCO 93/108: "IPC," telegram No. 226, March 23, 1973; PRO, FCO 93/108: "IPC," telegram No. 147, March 28, 1973; PRO, FCO 93/108: "IPC/Lebanon Plessy," April 7, 1973; PRO, FCO 93/108: "IPC," June 8, 1973.
57 "Lebanon to Honor Oil Pact Despite Ban," Daily Star, March 14, 1973; "Junblatt Says Iraq Unhappy with Lebanon over Pipelines," Daily Star, March 15, 1973.
58 "Iraq Imposes Ban on Lebanese Products", Wikileaks, U.S. Embassy Baghdad, March 15, 1973, https://wikileaks.org/plusd/cables/1973BEIRUT03016_b.html (accessed on March 20, 2018).
59 PRO, FCO 93/108: "Letter from IPC to the Lebanese petroleum and industrial minister," July 30, 1973; and PRO, FCO 93/108: "Medreco," August 4, 1973. The issue of compensation remained unresolved for the entire year of 1974. Lebanon objected to international arbitration and preferred to negotiate directly with IPC. However, these negotiations were fruitless, since Lebanon refused to retreat from what it considered to be a legitimate requisition, which it was forced to take due to the company's dishonest conduct.
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