Blood and Oil

“Blood and Oil: How America’s Thirst for Petrol is Killing Us” is a 2004 publication by Michael T. Klare. Klare is a Professor of Peace and World Securities Studies at Hampshire College, Amherst, Massachusetts and is also the author of “Rogue States and Nuclear Outlaws”, “Low Intensity Warfare” and “Resource Wars”. Klare’s thesis in “Blood and Oil” is that America has an ever-growing reliance on imported petroleum which dominates its foreign policy. Klare argues that the US must undergo a paradigm shift on its energy usage and policy or face ever more disastrous and bloody consequences.

The book commences with a dissertation on post Cold War politics. He dismisses Samuel Huntington’s premise in the “Clash of Civilisations” that identity politics would fill the vacuum left by the demise of political ideologies. Huntington saw new power blocs emerging on the basis of culture: The West, China, Japan, Orthodox, Indic, Muslim, African and Latin America. Future wars would be conducted on the fault lines of these civilisations. However Klare comes to a different conclusion to Huntington. In Klare’s view, it is resources that are at the root of most contemporary conflict. Access to minerals, water and land were all important triggers. But one resource stood out clearly in its overall impact: oil. In the twentieth century, cheap oil was at the heart of American economic vigour. Oil became so important it was considered a national security matter. The US relationship with corrupt oil regimes was exposed by 9/11 while demand continues to increase worldwide. The rest of his book is a study of oil, geopolitics and American foreign policy in order to understand the roots of the importance of petroleum and its payment in blood.

The US was the first country in the world to have a petroleum industry when oil was struck in Pennsylvania in 1859. It soon contributed to rapid and reliable transportation. Private cars and cheap petrol made the suburbs possible. Oil provided the raw material for paints, plastics, pharmaceuticals and textiles. The farm and tourist industries also totally rely on it. The first jolt to this dependence was the 1973 oil crisis when OPEC flexed its muscles and caused massive increases at the pump and an economic collapse worldwide. The Iranian revolution in 1979 and the Iraqi invasion of Kuwait in 1990 caused similar irruptions. The US was self-sufficient in oil until the end of World War II. Oil imports jumped from 10% in the fifties to 50% in the nineties. US production of oil has been in decline since 1972. As the percentage of imports grew, consumption is also increasing. The US used 13.5 million barrels a day for transportation in 2001 and is estimated to jump to 20.7 million by 2025. Klare then goes on to make the point that most exporting countries are unstable, unfriendly and/or in the middle of dangerous areas. As of 2002, the top ten countries with proven reserves of petroleum (in billions of barrels) are
1 Saudi Arabia 261.8
2 Iraq 112.5
3 UAE 97.8
4 Kuwait 96.5
5 Iran 89.7
6 Venezuela 77.8
7 Russia & Caspian states 77.1
8 USA 30.4
9 Libya 29.5
10 Nigeria 24
World total 1047.4
Six Persian Gulf countries possess 64% of the world’s known reserves. There may be more oil out there but it is also possible that peak oil (ie maximum production) has already occurred.

Klare goes on to describe the history of US-Saudi relations. The US started looking for petroleum in Arabia in the 1930s. By the end of the war, exploitation of Saudi petrol was a major policy objective. As early as 1943 Roosevelt declared ‘the defence of Saudi Arabia is vital to the defence of the US’. He cemented the relationship with a five and a half hour meeting with King Ibn Saud in March, 1945. No records were kept but they formed a tacit alliance which has lasted to the present day. The US held an air base on the Eastern port of Dhahran and provided funds to build an Arabian navy. They also funded the National Guard which defended the royal family against internal revolt. The fall of the Iranian Shah in 1979 was a direct cause of the Carter doctrine which declared that access to Persian Gulf oil was a vital national interest to be protected by ‘any means necessary.’ After the stalemate of the Iran-Iraq war, Saddam saw the conquest of Kuwait as a way out of his mounting debts. The US saw this as a direct threat to Saudi oil and decided military action was essential. But by putting 250,000 troops in Arabia, reactionaries such as Bin Laden had the perfect excuse to wage war on infidels in their holy land. The path to 9/11 was laid.

New president George W Bush charged Dick Cheney to come up with an energy policy for America in 2001. The National Energy Policy (NEP) written by Cheney, with help from Enron’s Kenneth Lay, was a disappointing pandering to the status quo and vested interests. It proposed steps to increase consumption and reliance on imports with little or no attempt to harness alternative resources. The proposal to open up Arctic Wilderness areas to drilling also produced denunciation of the report. The NEP confirmed the strategic importance of Gulf oil producers. The policy outlined the importance of the US military in ensuring steady supply. The US bolstered its ability to react to crises in the crucial Straits of Hormuz, the narrowest part of the Gulf. Saddam was seen as the biggest threat to secure production. Iran was seen as the second threat. The third threat was terrorism and the US acted to shore up the Saudi regime. Bush bolstered the new leader Abdullah’s authority by inviting him to his Texan ranch.

The 9/11 attacks gave the US excuse they needed to remove Saddam. As soon as they dismantled the Taliban regime, the focus switched to propaganda battle to justify an Iraqi invasion. The Department of Defence prepared to seize the Iraqi oilfields at the start of hostilities to prevent sabotage. Cheney’s Halliburton won a multi-billion no-bid contract to repair any post-war oil damage. When they finally attacked, they occupied the Baghdad Oil Ministry while ignoring all other government buildings. The oilfields were kept under state ownership which is forced to collaborate with the likes of Halliburton and Bechtel for infrastructure modernisation. But the US dilemma remains, without stability in the country, the oil output will not increase. The goal in Iran is the same; regime change. The US is used Iranian nuclear ambitions as a stick with which to beat them. US sanctions are in place but Iran is getting support from Russia and China. US energy policy remains tied to Persian Gulf oil and Iran will remain in the spotlight while this is the case.

Elsewhere, the NEP listed eight areas of interest where petroleum exports could be increased: Mexico, Colombia, Venezuela, Russia, Azerbaijan, Kazakhstan, Nigeria and Angola. These states have their own political problems. The Caspian area is a hotbed of nationalist wars, the African countries are politically unstable, the South American countries are riven with unrest and drug problems and Mexico is consuming nearly all its own oil.

Klare is concerned that US-Russian-Chinese geopolitics will play out in the Persian Gulf and Caspian Basin. Russia has a large nuclear arsenal and a substantial network of pipelines connected to the Caspian. Russia has influence in many countries in the area with financial support and military bases. China too is looking increasingly at this part of the world as its economic boom demands more oil products. It has sold arms and military technology to Iran, Iraq and Saudi Arabia. Beijing has established links with its neighbours in an effort suppress extremist Islamic movements in its westernmost province Xinjiang. Chinese state-owned oil companies have forged linked with over a dozen oil-producing countries. In each case they have outbid Western firms by substantial amounts. The US, Russia and China are major arms suppliers to all Middle East countries and it is likely that geopolitical tensions will continue to rise as oil stocks become more depleted.

Klare concludes by seeing this as a poor strategy for America. He sees the price of Gulf dependence as too steep. The US has ‘crawled into bed’ with corrupt and despotic governments and promoted terrorism in the process. The cost of oil will be measured in blood; the blood of oil-related violence in Iraq and possibly Iran, Colombia or the Caspian. Klare proposes a paradigm shift. He advocates a fundamental shift in values; more fuel-efficient vehicles, more mass transit, more cycling. But he acknowledges that leadership is required to facilitate this. The NEP should be scrapped. Energy policy should not be a driver of overseas security commitments. Anomalies in policy should be corrected to ensure that low-efficiency vehicles such as SUVs are taxed appropriately. The search for alternative fuels such as ethanol, hydrogen-powered fuel cells and hybrids should be re-doubled. Ultimately the US should be looking at the transition to a post-petroleum economy. The world will suffer petroleum shortages sometime in the next ten to twenty years.

The time is right to abandon the allegiance to oil and in Klare’s words “select the path of autonomy, self-restraint and innovation.”