Oil, geopolitics and war with
Iran
By Michael T Klare
If the United States attacks Iran, one thing is certain: the
administration of President George W Bush will never mention oil as a
reason for going to war. As in the case of Iraq, weapons of mass
destruction (WMD) will be cited as the principal justification for a US
assault. "We will not tolerate the construction of a nuclear weapon" by
Iran is the way Bush put it in a much-quoted 2003 statement.
But just as the failure to discover illicit weapons in Iraq undermined
the administration's use of WMD as the paramount reason for its
invasion, so its claim that an attack on Iran would be justified because
of its alleged nuclear potential should invite widespread skepticism.
More important, any serious assessment of Iran's strategic importance to
the US should focus on its role in the global energy equation.
Before proceeding, let me state for the record that I do not claim oil
is the sole driving force behind the Bush administration's apparent
determination to destroy Iranian military capabilities. No doubt there
are many national security professionals in Washington who are truly
worried about Iran's nuclear program, just as there were many
professionals who were genuinely worried about Iraqi weapons
capabilities. I respect this. But no war is ever prompted by one factor
alone, and it is evident from the public record that many
considerations, including oil, played a role in the administration's
decision to invade Iraq. Likewise, it is reasonable to assume that many
factors - again including oil - are playing a role in the
decision-making now under way over a possible assault on Iran.
Just exactly how much weight the oil factor carries in the
administration's decision-making is not something that we can determine
with absolute assurance at this time, but given the importance energy
has played in the careers and thinking of various high officials of the
Bush administration, and given Iran's immense resources, it would be
ludicrous not to take the oil factor into account - and yet you can rest
assured that, as relations with Iran worsen, US media reports and
analysis of the situation will generally steer a course well clear of
the subject (as they did in the lead-up to the invasion of Iraq).
One further caveat: When talking about oil's importance in US strategic
thinking about Iran, it is important to go beyond the obvious question
of Iran's potential role in satisfying our country's future energy
requirements. Because Iran occupies a strategic location on the north
side of the Persian Gulf, it is in a position to threaten oilfields in
Saudi Arabia, Kuwait, Iraq and the United Arab Emirates, which together
possess more than half of the world's known oil reserves. Iran also sits
athwart the Strait of Hormuz, the narrow waterway through which, daily,
40% of the world's oil exports pass. In addition, Iran is becoming a
major supplier of oil and natural gas to China, India and Japan, thereby
giving Tehran additional clout in world affairs. It is these
geopolitical dimensions of energy, as much as Iran's potential to export
significant quantities of oil to the US, that undoubtedly govern the
administration's strategic calculations.
Having said this, let me proceed to an assessment of Iran's future
energy potential. According to the most recent tally by Oil and Gas
Journal, Iran houses the second-largest pool of untapped petroleum in
the world, an estimated 125.8 billion barrels. Only Saudi Arabia, with
an estimated 260 billion barrels, possesses more; Iraq, the third in
line, has an estimated 115 billion barrels. With this much oil - about
one-tenth of the world's estimated total supply - Iran is certain to
play a key role in the global energy equation, no matter what else
occurs.
It is not, however, just sheer quantity that matters in Iran's case; no
less important is its future productive capacity. Although Saudi Arabia
possesses larger reserves, it is now producing oil at close to its
maximum sustainable rate (about 10 million barrels per day). It will
probably be unable to raise its output significantly over the next 20
years while global demand, pushed by significantly higher consumption in
the US, China and India, is expected to rise by 50%. Iran, on the other
hand, has considerable growth potential: it is now producing about 4
million barrels per day, but is thought to be capable of boosting its
output by another 3 million barrels or so. Few, if any, other countries
possess this potential, so Iran's importance as a producer, already
significant, is bound to grow in the years ahead.
And it is not just oil that Iran possesses in great abundance, but also
natural gas. According to Oil and Gas Journal, Iran has an estimated 940
trillion cubic feet (26.6 trillion cubic meters) of gas, or
approximately 16% of total world reserves. (Only Russia, with 1.68
quadrillion cubic feet, or 47.6 trillion cubic meters, has a larger
supply.) As it takes approximately 170 cubic meters of gas to equal the
energy content of one barrel of oil, Iran's gas reserves represent the
equivalent of about 155 billion barrels of oil. This, in turn, means
that its combined hydrocarbon reserves are the equivalent of some 280
billion barrels of oil, just slightly behind Saudi Arabia's combined
supply. At present, Iran is producing only a small share of its gas
reserves, about 76.5 billion cubic meters per year. This means that Iran
is one of the few countries capable of supplying much larger amounts of
natural gas in the future.
What all this means is that Iran will play a critical role in the
world's future energy equation. This is especially true because the
global demand for natural gas is growing faster than that for any other
source of energy, including oil. While the world currently consumes more
oil than gas, the supply of petroleum is expected to contract in the
not-too-distant future as global production approaches its peak
sustainable level - perhaps as soon as 2010 - and then begins a gradual
but irreversible decline. The production of natural gas, on the other
hand, is not likely to peak until several decades from now, and so is
expected to take up much of the slack when oil supplies become less
abundant. Natural gas is also considered a more attractive fuel than oil
in many applications, especially because when consumed it releases less
carbon dioxide (a major contributor to the greenhouse effect).
No doubt the major US energy companies would love to be working with
Iran today in developing these vast oil and gas supplies. At present,
however, they are prohibited from doing so by Executive Order (EO)
12959, signed by president Bill Clinton in 1995 and renewed by President
Bush in March 2004. The United States has also threatened to punish
foreign firms that do business in Iran (under the Iran-Libya Sanctions
Act of 1996), but this has not deterred many large companies from
seeking access to Iran's reserves. China, which will need vast amounts
of additional oil and gas to fuel its red-hot economy, is paying
particular attention to Iran. According to the US Department of Energy (DoE),
Iran supplied 14% of China's oil imports in 2003, and is expected to
provide an even larger share in the future. China is also expected to
rely on Iran for a large share of its liquefied natural gas (LNG)
imports. Last October, Iran signed a US$100 billion, 25-year contract
with Sinopec, a major Chinese energy firm, for joint development of one
of its major gas fields and the subsequent delivery of LNG to China. If
this deal is fully consummated, it will constitute one of China's
biggest overseas investments and represent a major strategic linkage
between the two countries.
India is also keen to obtain oil and gas from Iran. In January, the Gas
Authority of India Ltd (GAIL) signed a 30-year deal with the National
Iranian Gas Export Corp for the transfer of as much as 7.5 million tons
of LNG to India per year. The deal, worth an estimated $50 billion, will
also entail Indian involvement in the development of Iranian gas fields.
Even more noteworthy, Indian and Pakistani officials are discussing the
construction of a $3 billion natural-gas pipeline from Iran to India via
Pakistan - an extraordinary step for two long-term adversaries. If
completed, the pipeline would provide both countries with a substantial
supply of gas and allow Pakistan to reap $200 million to $500 million
per year in transit fees. "The gas pipeline is a win-win proposition for
Iran, India and Pakistan," Pakistani Prime Minister Shaukat Aziz
declared in January.
Despite the pipeline's obvious attractiveness as an incentive for
reconciliation between India and Pakistan - nuclear powers that have
fought three wars over Kashmir since 1947 and remain deadlocked over the
future status of that troubled territory - the project was condemned by
US Secretary of State Condoleezza Rice during a recent trip to India.
"We have communicated to the Indian government our concerns about the
gas-pipeline cooperation between Iran and India," she said on March 16
after meeting with Indian Foreign Minister Natwar Singh in New Delhi.
The Bush administration has, in fact, proved unwilling to back any
project that offers an economic benefit to Iran. This has not, however,
deterred India from proceeding with the pipeline.
Japan has also broken ranks with Washington on the issue of energy ties
with Iran. In early 2003, a consortium of three Japanese companies
acquired a 20% stake in the development of the Soroush-Nowruz offshore
field in the Persian Gulf, a reservoir thought to hold 1 billion barrels
of oil. One year later, the Iranian Offshore Oil Co awarded a $1.26
billion contract to Japan's JGC Corp for the recovery of natural gas and
natural-gas liquids from Soroush-Nowruz and other offshore fields.
When considering Iran's role in the global energy equation, therefore,
Bush administration officials have two key strategic aims: a desire to
open up Iranian oil and gas fields to exploitation by US firms, and
concern over Iran's growing ties to America's competitors in the global
energy market. Under US law, the first of these aims can only be
achieved after the president lifts EO 12959, and this is not likely to
occur as long as Iran is controlled by anti-American mullahs and refuses
to abandon its uranium-enrichment activities with potential bomb-making
applications. Likewise, the ban on US involvement in Iranian energy
production and export gives Tehran no choice but to pursue ties with
other consuming nations. From the Bush administration's point of view,
there is only one obvious and immediate way to alter this unappetizing
landscape - by inducing "regime change" in Iran and replacing the
existing leadership with one far friendlier to US strategic interests.
That the Bush administration seeks to foster regime change in Iran is
not in any doubt. The very fact that Iran was included with Saddam
Hussein's Iraq and Kim Jong-il's North Korea in the "axis of evil" in
Bush's 2002 State of the Union Address was an unmistakable indicator of
this. Bush let his feelings be known again in June 2003, at a time when
there were anti-government protests by students in Tehran. "This is the
beginning of people expressing themselves toward a free Iran, which I
think is positive," he declared. In a more significant indication of
White House attitudes on the subject, the Department of Defense has
failed to fully disarm the People's Mujahideen of Iran (or Mujahideen-e
Khalq, MEK), an anti-government militia now based in Iraq that has
conducted terrorist actions in Iran and is listed on the State
Department's roster of terrorist organizations. In 2003, the Washington
Post reported that some senior administration figures would like to use
the MEK as a proxy force in Iran, in the same manner that the Northern
Alliance was employed against the Taliban in Afghanistan.
The Iranian leadership is well aware that it faces a serious threat from
the Bush administration and is no doubt taking whatever steps it can to
prevent such an attack. Here, too, oil is a major factor in both
Tehran's and Washington's calculations. To deter a possible US assault,
Iran has threatened to close the Strait of Hormuz and otherwise obstruct
oil shipping in the Persian Gulf area. "An attack on Iran will be
tantamount to endangering Saudi Arabia, Kuwait and, in a word, the
entire Middle East oil," Iranian Expediency Council secretary Mohsen
Rezai said on March 1.
Such threats are taken very seriously by the US Department of Defense.
"We judge Iran can briefly close the Strait of Hormuz, relying on a
layered strategy using predominantly naval, air, and some ground
forces," Vice Admiral Lowell E Jacoby, the director of the Defense
Intelligence Agency, testified before the Senate Intelligence Committee
on February 16.
Planning for such attacks is, beyond doubt, a major priority for top
Pentagon officials. In January, veteran investigative reporter Seymour
Hersh reported in The New Yorker magazine that the Department of Defense
was conducting covert reconnaissance raids into Iran, supposedly to
identify hidden Iranian nuclear and missile facilities that could be
struck in future air and missile attacks. "I was repeatedly told that
the next strategic target was Iran," Hersh said of his interviews with
senior military personnel. Shortly thereafter, the Washington Post
revealed that the Pentagon was flying surveillance drones over Iran to
verify the location of weapons sites and to test Iranian air defenses.
As noted by the Post, "Aerial espionage [of this sort] is standard in
military preparations for an eventual air attack." There have also been
reports of talks between US and Israeli officials about a possible
Israeli strike on Iranian weapons facilities, presumably with
behind-the-scenes assistance from the United States.
In reality, much of Washington's concern about Iran's pursuit of WMD and
ballistic missiles is sparked by fears for the safety of Saudi Arabia,
Kuwait, Iraq, other Persian Gulf oil producers, and Israel rather than
by fears of a direct Iranian assault on the United States. "Tehran has
the only military in the region that can threaten its neighbors and Gulf
security," Jacoby declared in his February testimony. "Its expanding
ballistic-missile inventory presents a potential threat to states in the
region." It is this regional threat that US leaders are most determined
to eliminate.
In this sense, more than any other, the current planning for an attack
on Iran is fundamentally driven by concern over the safety of US energy
supplies, as was the 2003 US invasion of Iraq. In the most telling
expression of White House motives for going to war against Iraq, Vice
President Dick Cheney (in an August 2002 address to the Veterans of
Foreign Wars) described the threat from Iraq as follows: "Should all [of
Saddam's WMD] ambitions be realized, the implications would be enormous
for the Middle East and the United States ... Armed with an arsenal of
these weapons of terror and a seat atop 10% of the world's oil reserves,
Saddam Hussein could then be expected to seek domination of the entire
Middle East, take control of a great portion of the world's energy
supplies, [and] directly threaten America's friends throughout the
region." This was, of course, unthinkable to Bush's inner circle. And
all one need do is substitute the words "Iranian mullahs" for "Saddam
Hussein", and you have a perfect expression of the Bush administration
case for making war on Iran.
So, even while publicly focusing on Iran's weapons of mass destruction,
key Bush administration figures are certainly thinking in geopolitical
terms about Iran's role in the global energy equation and its capacity
to obstruct the global flow of petroleum. As was the case with Iraq, the
White House is determined to eliminate this threat once and for all. And
so, while oil may not be the administration's sole reason for going to
war with Iran, it is an essential factor in the overall strategic
calculation that makes war likely.
Michael T Klare is a professor of peace and world security
studies at Hampshire College and the author of Blood and Oil: The
Dangers and Consequences of America's Growing Dependency on Imported Oil
(Metropolitan Books). This article is used here by permission of
Tomdispatch.
(Copyright 2005 Michael T Klare.) |
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