Was the war really fought over oil?

The claim is often made that we invaded Iraq in 2003 to secure our access to its oil reserves, or, more cynically, to secure the profits of US energy-related companies. To me this policy made sense, at least in the short term. It was morally reprehensible and would probably hurt us in the long run but at least I could understand it. It made a lot more sense than the reasons the Bush administration announced: non-existent WMDs, non-existent cooperation between Saddam and Osama bin Laden,  and fulfilling the non-existent desires of the Iraqi masses to adopt electoral democracy and become close allies of the United States.

If securing access to oil were our real strategy, I would have expected us to cordon off the oil fields, empty the region of its indigenous inhabitants, and pump the place dry. As I said, morally reprehensible but a coherent strategy. We didn’t do that, of course. So perhaps we had a more sophisticated plan to achieve the same results? If so, it didn’t work very well. The average price of a barrel of domestic crude in 2002 in March 2013 dollars was $29.49. For 2012, it was $87.68. So we invested some $3 trillion (up from the original estimate of $80 billion), and what we got for it was a tripling of oil prices. Some bargain.

Now, obviously someone’s making money off all this — people who own the oil in the ground in west Texas, for example, and various defense contractors — so the invasion wasn’t a total loss. But it turns out that it did have the effect of securing energy supplies for years into the future, just not for us. This from a piece in today’s New York Times:

“We lost out,” said Michael Makovsky, a former Defense Department official in the Bush administration who worked on Iraq oil policy. “The Chinese had nothing to do with the war, but from an economic standpoint they are benefiting from it, and our Fifth Fleet and air forces are helping to assure their supply.”

This was clear to a lot of people even as far back as 2010, and it seems to be playing out as I predicted in my chapter in The Pentagon Labyrinth:

As for the economic spoils of the war, most of these appear to be going to countries that sign the best deals with the new regime, most prominently China.

So was the war really fought over oil? Yes, and the Chinese won. This strikes me, by the way, as an excellent example of the ancient strategy known as “shih.” you can read more about it in the three posts I’ve written for this site (search on “shih”) and from the last chapter of my book If We Can Keep It, available from the Articles page in the menu above.

23 thoughts on “Was the war really fought over oil?

  1. http://www.eia.gov/dnav/pet/pet_move_impcus_a2_nus_ep00_im0_mbbl_m.htm

    Canada and Mexico provide the lion’s share percentage of US oil supplies.
    The Excell pipeline intiative would increase US ascess to vast western
    Canadian oil reserves. Canada also has oil feilds offshore on the east coast.
    With more coming online.

    Some scientists and enviromentalist predicit thatif the Excell/Keystone
    pipelines proceed, there will be no turning back the destruction
    and ruination of the worlds ecosystem. Chris Hedges writes on ths.

    One could make a case that the continual meddling by the USA in
    the greater Middle East is about support for Israel, and contencous
    as it sounds, limiting the access to oil there, by US rivals, real,
    but more likley imgained, and contrived, and cultivated by the MICC.

    And of course, there is always, always, a buck to be made, by vested
    interests, in any military endevour. Protracted confilict with
    no decisive resoulition being the ideal of a self sustaining
    business model. Just wrap it in the flag, and pass that on to the
    media, and they do the rest to sell it to the hapless US public.

    How sick is that ?


  2. Just finished Fiasco

    comment over regarding your 4gw thesis

    He mentions that after Vietnam that the Army did its best to remake itself and forget everything it learned about counterinsurgency.

    Ricks also seems to waffle between 1) the decision to invade Iraq was made early and then did everything to fabricate the justifications for the decisions and 2) two camps that had honest disagreements about justifications to invade Iraq. He does make the point that enormous amounts of resources were diverted to the fabrications which significantly distracted from the real issues that needed to be faced. In the background seems to lurk Spinney’s theme about MICC objective for “Perpetual War” and constant flow of funds for major weapons systems(major counterinsurgency is effectively diplomacy which MICC has constantly undermined since it represents little funds flowing into MICC).

    Talks about overlap with the players between Desert Storm and the last decade … however, he doesn’t talk about the same players going back to “Team B” … Colby being replaced with Bush1 in the mid-70s … because the CIA wouldn’t get in line with the MICC analysis.
    Eisenhower was able to debunk MICC claims with CIA U2 photo recon. The Colby firing was getting CIA inline with MICC. He also doesn’t talk about “Team B” supporting Iraq in Iran/Iraq war
    Then it turns out that US is arms merchant to both sides
    lots of details were to be released in 2001 under the Presidential Records Act when the new president signs executive order keeping them classified.

    however “Fiasco” was written before a newer president rescinded the 2001 executive order

    Top Marine Sees A Future Of Perpetual War — Sandra I. Erwin, National Defense
    Top Marine Sees a Future of Perpetual War
    and Spinney’s reference

    … and then there is law of unattended consequences … the fabrication about WMD resulted in telling invading forces to bypass weapons&ammo bunkers and not blow them up, because they didn’t have facilities to deal with weapons of mass destruction … estimate was there some million metric tons bypassed (pg145) … when military got around to going back to destroy the bunkers … the contents had disappeared (and there was never any evidence of WMD) … bunker contents then fueled the insurgency and become major part of IEDs

    • lhw0,

      Thanks! Hope to have something new on 4GW within the next few days.

      Wish I’d never brought the subject up. I’m supposed to be retired, and all this blogging is seriously eating into my time for running, cycling, and yoga. Not to mention naps.

  3. It’s too simple to find reasons for a process as complex as war. In other words, it’s so easy to find reasons that they have no meaning, because there are so many reasons hinden in the complexity to make any attempt to find reasons incomplete. What happens is that the person looking for reasons finds the ones he wants to be the reason, but misses the “real” reasons.

    Also, if we look at what we get and what is lost in the process of war (the destruction and construction), then we end up with just a bunch of data that is so far removed from what was a human intention (reason) that any conclusions as to reasons don’t really mean much.

    But if we look at the strategy of war, I think the reason becomes clear, because strategy as the ends, ways and means of something, is a simplification of the process, allows for the destruction and construction in the form of a “Cheap Trick” (Tempo, by Venkatesh Rao), and strategy is represented as a human narrative in its reason.

    In the strategy for the war in Iraq, oil and the Iraqi people were the means to the war, and little else. The “way” was through the US financial institutions that provided the means for the US military, industrial, governmental complex to spread trillions of dollars throughout the region.

    The “end” was a US dollar that remains relevant throughout the Middle East and in connection with the oil reserves of the world. Which is quite different than the beginning of the “end” that showed an Euro on the rise in Iraq under the leadership of Saddam, and a Russian/Chinese “dollar” connection in other oil reserves in the world.

  4. To some extent oil interests overlapped with MICC “perpetual war”. The decision to go into Iraq was made at the start of the administration, before 9/11 … fabrication justification became easier after 9/11.

    National Insecurity

    has MICC came up with former soviet bloc countries becoming members of NATO … requiring replacing soviet arms with NATO compatible from MICC weapons merchants … underwritten by USAID. Leading up to Iraq invasion last decade, MICC told these countries that their membership in NATO would be improved if they voted for the Iraq invasion at UN … followed by becoming members of the coalition. Towards end of “FIASCO” has those coalition members being promised “peace keeping” roles … but then they were asked to participate in major battles … and it started to fall apart.

    • But it is like the by-line of my blog says, “THERE IS NO PROGRESSIVE OR GRADIENT FORM OF WARFARE; THERE ARE ONLY ARMIES WHO FIGHT THAT WAY.” Which should be added, “All war is about economic considerations, and fought by people with little economic considerations.”

      In other words, as Boyd would probably say: it’s about people, because armies fight to win, so the fighting takes the form of the winner, and not the loser.

      And if it is not about people, then it is about the economy, because the economy supplies the “Means” of war, and without the means, war is futile.

      In that context, the Obama’s “Pivot” to the Indo-Pacific is about economic considerations. the world is then left to understand the non-economic reasons for war, as it was during the Iraqi War.

      • Boyd, Spinney, Reform Movement, et al theme … aka “Perpetual War” … wasn’t that primary MICC objective was winning wars …. it is ever increasing amounts of funding for MICC. Actual winning is only a strategy when there is another lined up and waiting to take its place

    • There is no Irony in strategy. There is only winning strategy and losing strategy. Do you think that the Iraq war has gone on long enough to determine that the US strategy was a losing one, or is the US strategy simply unknown?

      • A Boyd strategy would be to have decisive victory with the minimum loss of resources and people. A MICC strategy is to maximize ongoing quarterly profits … it is orthogonal to winning & losing … it is continuous conflict and perpetual war, wanting to neither actually win nor loose (since either one could result in stopping the flow of profits, unless it is purely for setting the stage for the next round).

      • “A MICC strategy is to maximize ongoing quarterly profits”.

        That is not a strategy, it is a rule-set. A rule-set is a way, which is a part of strategy, but not strategy. Upon thinking about it further, I would say that the MICC has no strategy, because as you say, the process is continuous and perpetual. The MICC is a process, or, in Boydian terms, an OODA loop. Strategy is over process, and if I understand it correctly, Boyd was famous for finding a winning strategy, over process.

        The MICC is like every process, a structure filled with culture. If it is actually a loop, then it is the culture that is destructing the past and building a future as it goes, through its feedforward and feedback.

        Structurally, the MICC Observes its environment (planet earth), Orients its structure towards an advantage in the environment observed, makes its decisions depending on how the forces act on its structure, and then acts to grow its structure against the forces acting against its structure.

        The outcome of war between structures is determined by whose structure is left standing, but the MICC has a culture that is constantly moving backward and forward through time and space, designing and planning (D&C) its way from where it was to where it is going. The outcome of war between cultures is determined by whose left to see the past and future (both “ends” of strategy),

        Because an OODA loop contains both structure and culture it takes something that can move over the process to get ahead of it and defeat it. That “something is called strategy.

        Strategy is over process, and uses three domains–the ends (the image of both ends,i.e. the past and future), ways (the rule-sets that enable the process to move from the past to the future), and means (the resources that builds structure) of the process–to outmaneuver the process.

        And while there is winning strategy, I think all strategy is flawed.

        For one thing, the strategist begins to overcome the process by creating a clear image of at least one end (either the past or future), but there is no guarantee that what the strategist is “seeing” is real or not. The past is written by past winners and so it might be bias, and the future is really open to anyone’s guess.

  5. for the fun of it The Gun Seller (Hugh Laurie, also actor in tv “House”) loc2250-57:

    If you’ve ever had any training in military theory, it’s possible that you had to sit through a lecture on a thing called the Boyd Loop. Boyd was a chap who spent a large amount of time studying air-to-air combat during the Korean war, analysing typical ‘event sequences’ – or, in layman’s language, sequences of events – to see why pilot A was able to shoot down pilot B, and how pilot B felt about it afterwards, and which of them had had kedgeree for breakfast. Boyd’s theory was based on the utterly facile observation that when A did something, B reacted, A did something else, B reacted again et cetera, forming a loop of action and reaction. The Boyd Loop. Nice work if you can get it, you may be thinking. But Boyd’s ‘Eureka’ moment, which to this day causes his name to be bandied about military academies the world over, came when he hit upon the notion that if B could do two things in the space of time it normally took him to do one, he would ‘get inside the loop’, and the forces of right would thereby prevail.


    The day Alexander Woolf decided to take on the military-industrial complex was the day everything changed. For him, for his family, for his business. Things changed quickly, and they changed for good. Roused from its slumber, the military-industrial complex lifted a great, lazy paw, and swatted him away, as if he were no more than a human being. They cancelled his existing contracts and withdrew possible future ones. They bankrupted his suppliers, disrupted his labour force, and investigated him for tax evasion. They bought his company’s stock in a few months and sold it in a few hours, and when that didn’t do the trick, they accused him of trading in narcotics. They even had him thrown out of the St Regis, for not replacing a fairway divot.

    … snip …

    • Chet,
      Just a couple of thoughts. One: I have never understood all of this hand wringing over whether or not we fought a war to keep a maniac from controlling a large percentage of a critical strategic resource. The answer is, of course we did! What I have never understood is why the USA has abandoned the practice, long established by international custom, of charging a country for the privilege of being rescued or by insisting upon reparations from the aggressor state. The British paid us back every penny for the arms we provided them in War2 and I remember distinctly that they made the last installment about the same time I paid off my college loans. Why on earth we are not being paid in oil by Kuwait and Iraq, I cannot understand. Is it altruism or idiocy, or something else.

      Two: Is it my imagination or is the estimable Mr. Laurie being somewhat facetious? If he thinks that Boyd’s theories can be reduced to a law school fact pattern then I think he needs to start reading a few books before he starts with the down the nose. Let him start with Osinga; if he can chew his way through that, with those English teeth of his, then we could start him down the path through the garden of understanding. Those who need help need in understanding the complexity of Colonel Boyd’s work need only apply to any available Boyd scholar. Any of us would be willing to help him relieve himself of his vast and weighty ignorance.

      • Lots of “The Gun Seller” is story about the venality of the MICC … possbly Lurie ran into Boyd reference with respect to “The Reform Movement” versus the MICC and threw it in for a little additional atmosphere.

        One of the issues that FIASCO seems to waffle about … Chalabi was convenient source for “TEAM B” to trot out to support their fabrication … versus whether there was somebody that actually believed him. Totally unrelated, another place that “TEAM B” and fabrication shows up in “Merchants of Doubt” which is about public relations companies specializing in slanting views … starts out with their work for the tobacco industry.

        The previously posted URL for “Iraqi oil theme: US Rapine and Iraqi Redemption Via Chinese Investment The Irony of Iraq” references that the energy industry was to extract the profits from Iraq’s oil and somehow China may have beaten them out (alternative theme that actions weren’t on behalf of the country but for private interests/industry).

        (my browser shows “Reply” for above … but not for Chet’s following comment)

      • “This effects worldwide PRICES, distribution and availbility.”

        And we should not overlook the fact that, unless I am mistaken, the prices, distribution and availability is still all in the context of US dollars.

        I mean, the US military may be the largest single entity as a consumer of petroleum products, but the US military is using borrowed money, and, to a certain extent, the Chinese, by buying the US debt, have bought their way into access of the Iraqi oil .

        But the Chinese are also still buying the debt in US dollars, and, because of the US Iraqi War, Iraqis are still using US dollars in their oil exchange with China.

        At least the Iraqis should be still using US dollars, unless the Chinese have found another way, besides war, to flood the Iraqi economy and much of MENA with Chinese currency as the Bush/Obama administration seems to have succeeded in accomplishing.

        As I have said, all war is about economic considerations, and in that contexts it looks like the US is winning. Also in that context, the MICC still is an entity of the US government. The Chinese would like to send the Pacific Fleet home, but I am not sure, because of the Indo Pacific Pivot, that is going to happen.

        As a Complex (structure) there really is only one in the world. In other words, the Complex is held up as much by the forces pushing against it, as those forces pushing with it. In engineering a Complex remains in position (in the case of the Complex and the US economy a position of great advantage) when the sum of all of the forces are zero. The one thing China has fail to accomplish is to make those forces not-zero.

        Of course it seems like those who actually fight in war do so for considerations other than those that are economic in nature, so it is hard, considering the information available is so bias, to determine who’s winning on those fronts and centers in the Middle East and North Africa.

      • Chuck’s front page Time magazine article (“reform movement”) 30yrs ago is what led to my meeting John and sponsoring his briefings. A co-worker had gotten Chuck’s number and called him up and Chuck told him that he really needed to talk to John.

        John tells that the time article was 18m in preparation … mostly providing cover for Chuck (written authorization to release every bit of information) culmunating in congressional open hearing late Friday afternoon. MICC couldn’t stop the hearing but got it moved to late Friday and smallest hearing room they could find (where Watergate hearings were held) in attempt to minimize press coverage. SECDEF held damage control meeting Sat. morning and there was no press coverage. They supposedly were blind-sided when Time article hit Monday (18pg article written over the weekend?). SECDEF then attempts to prosecute Chuck … but Chuck’s written authorizations hold up. SECDEF then attempts to go after John (knowing John was behind the whole thing), transferring him to Alaska and banning him from the Pentagon for life. John still had congressional coverage, and orders to Alaska are rescinded and John is allowed back into the Pentagon (unlike the MICC victims in “Gun Seller”). Such congressional cover appears to be long gone.

        Gun Seller was originally published May 1997 … so John was still alive when it was being written (and predates the works written since that time)

      • lhw0,

        That’s pretty much how I remember it, except I think it was Jim Burton who got threatened with transfer to Siberia. John had retired in 1975.


    • “But Boyd’s ‘Eureka’ moment, which to this day causes his name to be bandied about military academies the world over, came when he hit upon the notion that if B could do two things in the space of time it normally took him to do one, he would ‘get inside the loop’, and the forces of right would thereby prevail.”

      Yes, but that is only one moment.

      Covering the same distance in time, but creating more space in the things you do, means that velocity has increased. In the context of the movement of energy (power), velocity is squared in the kinetic energy of “Act”, which Thomas PM Barnett has warned us about exponents.

      But then its cousin acceleration is squared in the potential energy of “Observation”.

      In your reference to Chalabi in the below postings:

      “One of the issues that FIASCO seems to waffle about … Chalabi was convenient source for “TEAM B” to trot out to support their fabrication … versus whether there was somebody that actually believed him. Totally unrelated, another place that “TEAM B” and fabrication shows up in “Merchants of Doubt” which is about public relations companies specializing in slanting views … starts out with their work for the tobacco industry.”, Chalabi represents the potential in Observation.

      In other words, Iran was able to “get inside the loop” in Observation by using Chalabi, as much as the US was able to get inside the Islamic economy by doing two thing in one generation, i.e., attacking the Center (Afghanistan) and the front (Iraq) and remain relevant in today’s economy.

      • #chet, John couched “alaska” in that he was working on contract … and the “contract” moved to alaska.

        #larry, there is some question whether MICC is agent of the gov. or the gov. is agent of MICC … the themes are MICC works in its self-interest … not the gov. (or the people) interests …. including Eisenhower’s warnings about the MICC.

        there is similar themes about FRCC (financial, regulator, congressional complex), PRCC (pharmaceutical, regulator congressional complex), ERCC (energy, regulatory congressional complex).

        upthread i referenced MICC and ERCC interests overlapping regarding Iraq; Chalabi
        use by both MICC and Iran doesn’t mean either was inside the other’s loop … anymore than MICC playing arms merchant to both sides in the Iran/Iraq war.

        In addition, the FRCC also plays in oil. “Vampire Squid” had chapter on commodity trading requiring players to have substantial position in s commodity because speculators resulted in wild, rational price swings. Then there were 19 secret letters allowing specific speculators to play …. resulting in wild irrational price swings … including huge spike in oil price the summer of 2008. At the time, major news operations carried lots of stories how the gas price spike was having significant hardship on lots of people

        There have been several recent discussion in (closed linkedin) financial fraud group about gov. not upholding whistleblower protection and the related news outlets handling (including criticism of “vampire squid”).

        In the case of the speculators causing huge price spike in oil/gas … a member of congress releases trading data showing speculators (including too-big-to-fail) causing the problem. Then news wasn’t about blaming the speculators for the hardships summer of 2008 … but member of congress was wrong for releasing the trading data.

      • “use by both MICC and Iran doesn’t mean either was inside the other’s loop … anymore than MICC playing arms merchant to both sides in the Iran/Iraq war.”

        I agree with you completely. Playing both sides does not necessarily, if ever, get you into the loop. However, I believe Chalabi wasn’t really playing both sides. I think his vision of Iraq was clearly on the side of Iran, and he was used by Iran to get inside the loop of the US military through the US military’s civilian command.

        I believe the first event that signals Iran’s success in entering this loop happened on the day BushII gave the go to penetrate Iraq’s defences. On that day Bush admitted that he discussed and showed his operational plans with his “uncle” Baldor (not sure of spelling) [CR: probably Pr. Bandar bin Sultan, Saudi ambassador to the US], a member of the Saudi family.

        Only a complete idiot or someone with a clear vision of what victory was going to look like (thanks to Chalabi and other characters) would show what the operation was going to look like to a member of those who have command of the economy (at least the Sunni side of the front between Sunni and Shia), that his military was about to Isolate, Subvert, Re-Orient, and Re-harmonize (have already committed to Penetrate). Or what is otherwise known as PISRR, the Boydian way to destroy an OODA loop.

        Now I agree if you were to say that BushII was an idiot, but I also believe that Iran knows Boyd. After all, the counter to the OODA loop (PISRR) has been around longer than Boyd. It is really what’s called Modern Warfare and together with the OODA loop was used against the Native Americans and the Aborigines in Australia, many years prior to Boyd’s development of the OODA loop itself.

  6. Let’s not overlook the simple fact that the US military under substantial deployment, such as in Iraq and Afganistan, now Africa, is the largest single entity as a consumer of petrolium products.
    This effects worldwide PRICES, distribution and availbility.

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