Iraq, Civil War, Oil, Geopolitics

Of course it is no surprise that the decision to invade Iraq was made in 2002, long before Bush said he had committed the country for war and before congress granted approval.

What is more surprising, and certainly unthinkable to most Americans, is the idea that the Iraq unrest is all part of the US plan: "Pentagon financing of these myriad militias and the active involvement of Allawi in all these operations suggest that the Pentagon itself is destabilizing the country it is supposed to control. Destination: civil war."

Along these same lines, here is an excellent post on this topic at Rigorous Intuition.

Finally this article here, points to what likely is the true grand strategy behind Iraq:

A controversial oil industry expert speaking earlier this month at the Lancaster Rotary Club said the U.S. government is responsible for record-high gasoline prices.

James R. Norman, a former editor of Forbes magazine and a senior writer with a prominent oil industry newsletter, said high oil prices are part of a National Security Administration policy to prevent the superpower Chinese from achieving global dominance.

Norman, who also spoke at two other venues in Lancaster this month, said there is a long-term economic strategy in place to restrain Chinese growth through artificially high oil prices.

By creating "paper demand" for oil on the New York Mercantile Exchange, large U.S. oil companies, the Saudis and the Bush administration have conspired to nearly triple world oil prices from about $20 a barrel in New York at the start of 2002, according to Norman.

Norman, who worked as a reporter covering the oil industry in Houston for nine years before joining Forbes, said unknown institutional fund buyers have created a huge demand for oil and pushed the price of light sweet crude oil on the West Texas Intermediate.

The Chinese pay close to the WTI rate, which rose from $19.67 per barrel in January 2002 to its current rate of $52.78.

Evidence of a covert plan to fix prices includes massive cuts in capital spending by U.S. oil companies that essentially shut down oil exploration since 2000, a Saudi change from a market-share strategy to a price-support strategy that restricted its output and an increase in U.S. strategic oil reserves when prices are at near record highs, Norman said.

He said American oil companies no longer assist the Chinese and that Exxon, BP, Shell and others have inexplicably sold their stake in oil companies there.

China overtook Japan last year as the world's second-largest consumer of oil, and experts predicts that China's consumption will triple over the next 20 years.

The Chinese rely heavily on oil to produce electricity and are not equipped to refine sour crude oil. Norman said it's no coincidence that the sour crude is selling at discounts of up to $18 per barrel, when compared with light, sweet crude.

In perhaps his most controversial assertion, Norman suggested that the U.S. invasion of Iraq was partially motivated by Chinese interest in Iraqi oil. The war negated an agreement Saddam Hussein had signed giving China equity interest in oil rights once U.N. sanctions were lifted.

"If the sanctions were lifted and the Chinese got in there, we'd never be able to undo that situation," Norman said.

"The war was a screaming success because it kept China from acquiring in-the-ground oil reserves in the Middle East and basically put the Chinese on notice that wherever they go for oil, there will be hell to pay."

Norman said it's not surprising that the U.S. government has made things difficult for Venezuela, Yemen and Sudan, and has been especially threatening to Iran for supplying oil to the Chinese.

Overt U.S. threats to Iran have escalated since China last year signed a $100 million deal with Iran allowing Chinese investment in its oil and gas exploration and pipeline infrastructure.

Though it will take up to 10 years, Norman said very high oil prices could severely crimp the Chinese economy by knocking 3 percentage points off its annual growth rate.

"That may not sound like much, but over time when you compound that with a country that's already got problems employing its huge population, you start to create stresses in a very brittle political system," Norman said.

Norman, who writes for Platts Oilgram News in New York, said manipulated oil prices in the 1980s coerced Soviet Union capitulation.

The Reagan administration manipulated oil prices downward to limit the Soviet Union's hard currency and force it into bankruptcy, Norman said.

He pointed to a 1982 National Security Administration directive that spelled out the Reagan administration's plan to attack key elements in the Russian economy, including its oil exportation.

The Saudis overproduced oil when prices had been skidding and U.S. oil companies also had increased their oil production by 5 percent per year, said Norman.

Ironically, Norman believes the Russians, who have refused to build an oil pipeline into China, are now on board with the U.S. government in isolating the Chinese.

Norman said former Reagan administration personnel currently working in the White House had perfected oil price fixing as an economic weapon.

"Controlling oil prices is a tried-and-true method of restraining growth," Norman said. "We did it to the Russians and you have the same group in Washington who had done it back in the Reagan years."

I'm sure it is no coincidence that the Iraq insurgency has completely reduced Iraq's oil production to almost nothing.

It's also interesting to think that the fact that new refineries are not being built has little to do with Peak Oil (a la Mike Ruppert) and much more to do with keeping oil prices high.

Since keeping China in check has long been a major geopolitical goal of the US, I find this overall theory of the Iraq war appealing.

In this regard, Dave McGowan and Webster Tarpley are correct about oil and 9/11 and Iraq. Peak oil as the sole motivation for 9/11 (a la Mike Ruppert) has always struck me as a bit simple-minded, and a more reasonable idea is that capturing and controlling the oil supplies in the middle east were major motivating factors for 9/11-- particularly when China's need for oil is factored in.