Big Oil pumps up the ugly Afghan and Iraqi mix
LAWRENCE MARTIN
From Thursday's Globe and Mail
July 2, 2008 at 8:48 PM EDT
In the war zones, the oil deals are coming on stream.
Afghanistan recently signed a major agreement to build an American-backed pipeline. It will traverse the Kandahar region where Canadian forces are fighting. If they're still there, Canadians could well be called on to be a pipeline protection force.
In Iraq this week, the giant oil fields were opened to foreign bidders. U.S. conglomerates such as Exxon Mobil are about to sign no-bid contracts to move in. Big Oil, already brimming with profits, will have a fine Fourth of July.
The new Baghdad deals will trigger more wrangling over the real motivation for the Iraq invasion. There was a time when it was mainly just conspiracy theorists and other assorted weedy types who claimed the aggression was chiefly about oil. But along came Alan Greenspan, the former chairman of the U.S. Federal Reserve Board, who wrote last year in his book The Age of Turbulence, “I am saddened that it is politically inconvenient to acknowledge what everyone knows: The Iraq war is largely about oil.” This week's entry of Big Oil in Iraq will only buttress this view.
The Afghan war wasn't all about oil. But that has certainly been among Washington's motivations and now, with the pipeline deal, it will be front and centre. As for Canada, oil wasn't on the radar screen in our war debate. Liberal governments didn't discuss it. “Never once heard mention of it from 2002 to 2006,” said Eugene Lang, who worked closely on the Afghan file with two Liberal defence ministers.
In the late 1990s, an American-led oil consortium held talks with the Taliban about building a pipeline from Central Asia – where oil and gas reserves are gigantic – through Afghanistan to Pakistan, from where it could be shipped westward. The talks broke down in mid-2001. Washington was furious, leading to speculation it might take out the Taliban. After 9/11, the Taliban, with good reason, were removed – and pipeline planning continued with the Karzai government. U.S. forces installed bases near Kandahar, where the pipeline was to run. A key motivation for the pipeline was to block a competing bid involving Iran, a charter member of the “axis of evil.”
U.S. Assistant Secretary of State Richard Boucher said recently that Washington has a “fundamental strategic interest” in Afghanistan that extends well beyond ensuring it is not used as a base for terrorism. In Ottawa, energy economist John Foster recently released a report on the pipeline. “Government efforts to convince Canadians to stay in Afghanistan have been enormous,” he wrote, “but the impact of the proposed multibillion-dollar pipeline in areas of Afghanistan under Canadian purview has never been seriously debated.”
In November of 2006, the Conservatives seemed to take a stand. At a little-noticed meeting in New Delhi, they agreed to help Kabul become an energy bridge through the building of the pipeline.
With the Afghan war not going well, the likelihood is the $7.6-billion project might not proceed for a few years. Canadian soldiers could well be gone by then, though we could extend our deadline one more time. The Americans would certainly like us to help them defend the pipeline route.
What should also be considered is that Afghanistan stands to reap a windfall in transit fees if the pipeline goes ahead. Such a pipeline also would help the U.S. in its energy needs – needs that its entry into Iraq's oil fields would help replenish too.
But the plan should be to get off dependence on foreign oil. The Bush administration has utterly failed to move the ball forward on energy independence. Some war boosters predicted that a successful Iraq war would bring oil down to $20 a barrel. It is now about seven times that price. The war, which cut Iraqi production, contributed to the massive U.S. debt and the plunge in the greenback's value, a significant factor in the prices we now pay at the pump.
Both the American infiltration of Iraq's oil fields and the Afghan project might serve to increase the flow and eventually help stabilize prices to some degree.
War for oil is hardly a savoury option. But get ready. With the signing of the pipeline plan in Kabul, it will soon be part of the debate in this country.
