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Iraqi oil and the American consumer- are we better off?

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Now that Greenspan has acknowledged that the invasion and occupation of Iraq is about securing Iraqi oil reserves, we can look a little more realistically at the whole situation. We always knew it, of course.

One reason, perhaps the main reason, that the American people have put up with the illegal military operation in Iraq is that we are dependent on automobiles, and the fear of running out of oil has been drummed into us.

Although it hasn't been stated, many Americans assume that if "we" control Iraqi oil, the price of gasoline will remain within reasonable limits. Of course, if the US military, who are paid with the tax dollars of We the People, can secure Iraqi oil, we the consumers get the benefits. RIGHT?

WRONG, for a couple of reasons:

1) the ongoing turmoil in Iraq has essentially removed 4 million barrels/day of oil from the world market- about 5%. Meanwhile, demand continues to increase. With supply shorter, the price goes up.

2) the main goal of the Bush administration's invasion of Iraq is to privatize Iraqi oil. This helps the buddies of Bush and Cheney in the multinational oil corporations. What is the effect on the American consumer?

Most oil states (including Iraq under Saddam) control their their own petroleum industries and belong to
the Organization of the Petroleum Exporting Countries. OPEC's stated aim is to ensure a steady supply of oil to the world market, without price fluctuations, with a fair profit to investors. This BENEFITS consumers.

By contrast, the private corporations- Exxon-Mobil, Shell and the others, have a stated goal of maximizing profits for stockholders. It is in their interest to raise the price of oil as much as possible, and gouge consumers. Privatizing Iraqi oil benefits the big international oil companies and HURTS consumers.

Let's look at some facts.

The price of gasoline has gone up 50% since March 2003, when the US illegally invaded Iraq. It averaged $2.00/gallon at that time, now it's over $3.00/ gallon.

Profits of the big oil conglomerates have gone way up. According to the London Times 7/27/2006 :

Exxon Mobil profit jumps to more than $10B Soaring energy prices catapulted Exxon Mobil, the world''s largest publicly traded oil company, to a second-quarter profit of more than $10 billion (euro7.85 billion), and they promise to ignite industrywide growth -- and public outrage -- all year. Royal Dutch Shell PLC came close to matching Exxon Mobil Corp.''s 36 percent quarterly earnings boost on Thursday, posting net income of $7.3 billion (euro5.73 billion), an increase of 40 percent from the year before.

 

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Carol S. Wolman, MD is a psychiatrist in Northern California. A lifelong peace activist, she is helping to distribute a Peace Plan for the Holy Land- email her for a copy. She also a film producer with Paradise Cove Productions, currently (more...)
 

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