October 4, 2002

Bush Donors: Saddam's Best Customers

A BuzzFlash Reader Commentary
by Margie Burns

Throughout the Bush administration, and to this day, US oil companies have been among Saddam Hussein's best customers, with the knowledge and encouragement of the White House.

* The London Times reported on January 23, 2001 -- as soon as Bush entered the White House -- that BP and ExxonMobil were again buying oil from Iraq, in spite of the problems involved with corruption and public relations.

* At the beginning of April 2001, the Middle East Economic Survey, an industry research periodical, reported that ninety percent of Iraq's oil sales in January and February had gone to US companies. Following that lead, international oil companies jumped into the market, and MEES reported that Iraq's March oil sales would surpass previous levels.

* The next week, MEES reported that "the main market for Iraqi crude is now the US."

* On April 3, the new administration's State Department sent an unusual letter to executives in about 23 US companies, pointing that "the US is the largest customer of Iraqi oil." The concern of the letter, however, was not that the US was Iraq's biggest customer. The concern was that US companies not pay too much, by yielding to Baghdad's demands for a "surcharge" for shipping to US customers rather than to others.

* Indeed, US companies were Iraq's biggest customers throughout 2001, a fact not emphasized publicly by this administration. According to the Department of Energy, America imported about 290 million barrels of crude oil from Iraq in 2001 -- abut 795,000 barrels per day, making Iraq our sixth-largest supplier.

* Forbes Magazine -- not to be confused with Sierra Club publications -- estimated this summer that American companies purchased almost 70% of Iraqi oil in 2001, naming ChevronTexaco, ExxonMobil, BP, and Marathon Oil.

* Despite assertions intermittently linking Iraq with terrorism, by the way, Iraqi sales and US imports of Iraqi oil remained high throughout fall of 2001, with no sign that the White House considered this a security breach. (Chevron and Texaco, two major Iraqi oil customers, merged on October 9, 2001, less than a month after September 11.) By mid-November 2001, Iraqi sales were soaring again.

* This is not to imply that the imports stopped, or even slowed down, at the beginning of 2002. According to the American Petroleum Institute -- which has yet to be mistaken for Greenpeace -- US companies imported an average 611,000 barrels per day from Iraq from January through June of this year, making Iraq America's fifth-largest supplier of oil in the first half of 2002.

* As recently as this summer, the Middle East Economic Survey estimated that "as much as 90 percent of the actual amount of Iraq's estimated 1.8 million barrels per day (bpd) are going to U.S. Gulf coast refineries" (cited by ABC News.com, July 20, 2002).

* The Bush White House, Republicans in the House of Representatives, and the oil companies have opposed ANY effort to curtail US purchases of Iraqi oil. Iraq holds the world's second-largest oil reserves, and Iraqi oil has less sulfur than other oil, reducing the cost of environmental compliance for refineries. When Saddam cut off supplies to American companies last May, US companies and the White House tried to get around the embargo -- less by finding other sources for oil, or developing alternative energy, than by buying Iraqi oil through Russia and other middlemen.

* Iraq transports millions of barrels of oil openly via pipeline through our ally Turkey, and tankers supplying US companies uplift most of their Iraqi shipments at the Turkish port of Ceyhan, with the full knowledge and consent of the administration. US shipping, be it noted, is regulated at every level by the federal government.

* Of course, Iraq also sells huge quantities of oil to our allies, including Turkey, Jordan, and Russia. It also sells through middlemen of virtually every nationality, including those of our allies, again with the knowledge and consent of the administration. The White House is not even sanctioning our non-ally Syria, which is massively dependent on Iraqi oil and has constructed a joint pipeline with Iraq, for buying in excess of allowable amounts. This May, Iraq completed repairs on the Iraq-Saudi Arabia pipeline, which had been out of commission since 1990, although Saudi Arabia is theoretically a premier US ally in the Middle East.

* Former subsidiaries of Vice President Cheney's Halliburton are also still doing business with Iraqi oil fields, and the oil fields are operating with equipment and facilities provided by Halliburton. Not much new there: Halliburton, a huge oil field equipment and supply company with over five hundred subsidiaries, contributed largely to the rebuilding of Iraq's oil sector after the ravages of two wars.

The administration's suddenly finding Saddam a 'Hitler' is a transparently bogus claim. US oil companies are competing to pay billions to Hitler? The administration has been facilitating resale of Hitler's oil in this country, at a profit for middlemen (both US and foreign)? Vice President Cheney's Halliburton has been dealing with Hitler?

To call this policy inconsistent, however, would be jumping to conclusions. It is not inconsistent to pay Saddam for all the oil you can acquire -- profiting your cronies and your campaign supporters -- without mentioning that to the American people, and to try to get other Americans to put their lives on the line to war against him at the same time. Not if you have decided that you want Iraq's oil, and that you have a right to get anything you want by force. Fortunately, the overwhelming majority of Americans do not hold that belief.

Several times in recent years, Big Oil has found itself allied with humanitarians, in opposing sanctions on Iraq. Undoubtedly some in corporate circles have been sincere in staking out this position. But it ill beseems those who oppose restrictions on the purchase of Iraqi oil, on humanitarian grounds, to support bombing and invading the Iraqi nation. The Bush administration's weird insistence on rushing to war -- right now -- has been widely criticized as an exchange of 'blood for oil.' This is an incomplete formulation; more accurate phrasing would be 'their oil, other people's blood.' Meanwhile, White House bellicosity toward Iraq is driving up the price of crude -- benefiting both Bush's contributors in America's corporate energy sector, and Saddam Hussein.

Margie Burns
301-386-5615
margie.burns@verizon.net

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