Essentially the oil companies are trying to lock in a low risk, high reward situation for themselves, using PSA's as the legalistic vehicle and the US Army as their negotiating leverage. 

Isn't it revealing that no one in the mainstream media has made it clear that one of the 'benchmarks' is for Iraq's parliament to agree to let US oil companies start taking Iraqi oil and pay only a 12.5% royalty for the privilege?  I haven't even heard anyone on Air America mention this.  However, Antonia Juhasz was on Amy Goodman's Democracy Now! talking about this issue. 

America started with what was a fairly stable situation in Iraq, in which a large volume of oil was being produced for many years, and then we went in and totally destabilized it, creating a power vacuum in which multiple parties rushed, and civil war began. 

We also "forgot" to guard the weapons depots or to confiscate the weapons of the Baathist army before we gave them their marching papers, thereby ensuring that the civil war would be especially bloody and long-lived. 

Oh, and we also destroyed much of the electrical, water, and sewage infrastructure, and many of the schools and hospitals.  We created chaos, and now we're offering to "save" the Iraqis from the very chaos we created.  And, for our trouble, we are "requesting" 87.5% of their oil! 

We've hemmed them into a corner.  Their only options are give us the oil or the chaos continues.  It's a simple protection racket, writ large. 

Reeeeal nice country you got here.   It would be a shame if anything were to happen to it, see?  Oh!  Clumsy me!  I've gone and invaded your country.   Boy, you'd better sign this agreement before anything else bad happens!

"No major oil companies are willing to invest in Iraq now, no matter how sweet the deal.  If order is restored, however, Iraq would have no trouble attracting vast amounts of finance capital to develop reserves that could well be worth in excess of $10 trillion, and hence would have no need whatsoever for PSAs."

http://www.globalpolicy.org/security/oil/2005/crudedesigns.htm

From wsws.org:

Under sustained US pressure, Iraqi cabinet sends oil law to parliament

The centrality of the oil law to the objectives of the US occupation is underscored by its prominent place in the Bush administration "benchmarks" for the Iraqi government.  Since the draft legislation was first revealed on February 26, senior figures of Bush's cabinet, ranging from Secretary of State Condoleezza Rice, Vice President Dick Cheney to Defense Secretary Robert Gates, have visited Baghdad to bully the various Iraqi factions in the US-backed parliament to accept its terms.  The White House is pressuring Maliki to push through the legislation and other key benchmarks well before September, when a report to Congress on the progress of the latest US military "surge" is due. 

http://www.wsws.org/articles/2007/jul2007/oil-j05.shtml

Key points made by Dennis Kucinich when interviewed by Amy Goodman:

There is a benchmark in the Warner amendment that will keep our troops in Iraq indefinitely.  This benchmark  insists that the Iraq's government pass a hydrocarbon act -- an "oil law" that  is supposedly about the equitable sharing of  oil revenues.  But this proposed oil law comes in the form of a thirty-three-page document that's all about the restructuring of the Iraq oil industry so as to permit multinational oil corporations to take over 80% of Iraq's oil.  This is a criminal action that is going on here, right under our noses, and we ought to be standing up against it and challenging it.  The US has no right to take Iraq's oil or to facilitate the acquisition of (or profits from) Iraq's oil for multinational corporations, i.e.  "Big Oil" (Exxon, Shell, et. al.)

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