NYT: U.S. Oil Majors Back in Iraq

(10:00AM EST – promoted by Nightprowlkitty)

In November 2007, President Bush and Prime Minister Maliki signed a “Declaration of Principles” without the approval of the U.S. Congress or the Iraqi Parliament.  This document outlined military and economic commitments between the two countries.

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(White House Photo: Bush and Maliki signing the Declaration of Principles, Nov. 26, 2007)

Later, this Declaration was broken into two agreements, to be ratified by July of this year.  One, the Status of Forces Agreement, concerns the military part of the Declaration and has received the most attention in the blogosphere.  The other, called the “Strategic Framework Agreement,” concerned “Cultural and Economic ties”, that is to say, oil.

The New York Times is tomorrow reporting that U.S. oil majors are getting back into Iraq as of June 30.  This appears to me to indicate that the second half of the Declaration is succeeding.

Deals With Iraq Are Set to Bring Oil Giants Back

By ANDREW E. KRAMER

Published: June 19, 2008

BAGHDAD – Four Western oil companies are in the final stages of negotiations this month on contracts that will return them to Iraq, 36 years after losing their oil concession to nationalization as Saddam Hussein rose to power.

— snip —

The deals, expected to be announced on June 30, will lay the foundation for the first commercial work for the major companies in Iraq since the American invasion, and open a new and potentially lucrative country for their operations.

This April article from Truthout explains the background and the meaning of the events related in tomorrow’s NYT article:

U.S. Attempt to Control Iraq’s Oil and Economy Continues Behind the Scenes

By Maya Schenwar, TruthOut.org. Posted April 7, 2008.

While the portion of the Declaration that suggests a permanent US military presence in Iraq has garnered much attention, the agreement also proposes another goal: to solidify “economic ties” between the two countries and grant the US preferential treatment in trading with Iraq.

— snip —

This article provides a good backgrounder on the current situation.  I suggest reading the whole thing.  Continuing:

The Maliki administration has also done its share of dodging Parliament’s prohibition on international oil investment. Long-term contracts may be off limits, but short-term contracts stop just short of illegal, and Iraq’s executive branch is swooping in on that loophole.

“You have the oil minister trying to sign two-year contracts with the oil companies, to demonstrate that the Maliki government is working with oil companies, even if Parliament is not,” Juhasz said [Antonia Juhasz, a fellow at Oil Change International].

The New York Times article closes with a reference to the oil execs’ understanding of history:

But the company is clearly aware of the history. In an interview with Newsweek last fall, the former chief executive of Exxon, Lee Raymond, praised Iraq’s potential as an oil-producing country and added that Exxon was in a position to know. “There is an enormous amount of oil in Iraq,” Mr. Raymond said. “We were part of the consortium, the four companies that were there when Saddam Hussein threw us out, and we basically had the whole country.”

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  1. at DailyKos.

    For further background on this, you might check my earlier diary, Coming in July: Bush and Maliki’s Tag-Team Swindle.

  2. …that it confirms what many of us suspected and accused the Bush administration of from the beginning.

    But I don’t know how much of a scandal it is now.  There are essentially four corporate players in the international oil market; the US, the British, the Venezuelans, and the Russians.  And the companies listed include all of those players except the Russians and Lukoil (which makes a degree of sense, as Russia may be the only nation more corrupt than Iraq).  At the end of the day, Exxon, BP, Shell, and Chevron are the entities best suited to this work in the world.  I’d prefer open bidding, even an auction, but basically, these are the right entities for the job.

    • Edger on June 19, 2008 at 6:56 am

    Last November after the declaration was signed Spencer Ackerman also helped cut through the crap to the core of it….

    A “democratic Iraq” here means the Shiite-led Iraqi government. The current political arrangement will receive U.S. military protection against coups or any other internal subversion. That’s something the Iraqi government wants desperately: not only is it massively unpopular, even among Iraqi Shiites, but the increasing U.S.-Sunni security cooperation strikes the Shiite government — with some justification — as a recipe for a future coup.

    Notice also the timetable. The U.S. and Iraq will negotiate another year-long United Nations mandate for foreign troops in Iraq, which will expire (I think) in late December 2008. According to today’s declaration, following the forthcoming renewal at the U.N., “we will begin negotiation of a framework that will govern the future of our bilateral relationship.” That means that during Bush’s last year in office, the administration will work out the terms of the U.S.’s stay in Iraq in order to, at the very least, seriously constrain the next administration’s options for ending the U.S. presence. Even if Bush doesn’t take the audacious step of signing a so-called Status of Forces Agreement — the basic document for garrisoning U.S. forces on foreign soil — while he’s a lame duck, the simple fact of negotiations will create a diplomatic expectation that his successor will find difficult to reverse.

  3. In the thread and in discussions generally, we talk about the war and imperial policy being done in “U.S. interests.” I think the fact is that Iraq was invaded for corporate interests, which supersede those of the U.S. and any other country. The nation-state is being supplanted by the corporation. And this is why policy decisions are always somehow mysteriously beyond our reach. Corporations are not democracies.

  4. of “US interests” or “Our vital interests”. There are some hints here and there. The best I’ve been able to find is a quote from former CIA officer Philip Agee in which he said: US interests are defined traditionally as unfettered access to the primary products and raw materials, to the labor and to the markets of foreign countries.

    If we just let that sink in for a moment, once this is understood, US foreign policy, past, present and future suddenly becomes more clear.

    Corporate interests are a large part of our traditional national interests. So is unfettered access to the primary raw materials, markets and labor of foreign countries. Now oil is the key. It is not difficult to see why we have occupied Iraq – Saddam did not allow unfettered access to his country’s oil. Iran does not allow unfettered access. Venezuela does not allow unfettered access. And so these countries, rich in oil and gas are demonized and given a high priority for regime change. In 2002 a CIA led coup in Venezuela failed but they will be back.

    Communism used to be the bogeyman. Any country that dared resist would be labeled as having communist ties. Now it’s terrorism and all it is is cover for doing what ever it takes to serve our national interests. Serving our national interests creates the very terrorists we use to justify our actions. How clever.

    The politicians all know this. Pay attention next time you hear any of them refer to “our vital interests”. Once this is understood we can understand why they vote the way they vote, why they haven’t impeached the Cheney gang, why they will allow FISA, why the passed the Patriot Act so easily, why they voted for Kyle – Lieberman, etc. etc.

    Bringing freedom and democracy to the unwashed is just nothing but bullshit.

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