This is a good summary account of the new oil law and its implications. It pulls no punches but seems quite accurate on the whole. The article is correct too in noticing that the western mainstream media has on the whole studiously ignored the whole issue with few exceptions. You would think that this would be headline news at least for a while! The article does not have much to say about privatisation per se.Perhaps that reflects the fact that China too is into the privatisation business! I am not sure what the situation is though with respect to China's own oil resources. I will have to investigate that. It may be that the state has retained ownership of oil as an essential resource.
Finally, desire unmasked
On the fourth anniversary of the start of the Iraq war, the draft of a new petroleum law, partly formulated by the US government, was pulled through the Iraqi cabinet and is now waiting for parliament's approval. According to the draft, 65 of the 80 known oilfields in Iraq will be tapped by foreign oil companies; Iraq will sign product distribution agreements with those companies for a term between 15 and 35 years. Foreign companies get a return of 75 percent at the initial stages.
There is little coverage of the new petroleum law in Western mainstream media or the Iraqi media. Both the governments of Iraq and the US have kept a low profile on the matter, and the Iraqi public knows almost nothing about it. However, some well-informed Iraqis and oil unions have vehemently attacked the draft legislation as "not transparent, not democratic and foreign force dominated". The draft, as it exists, was initially formulated by a consulting company hired by the US government and revised by big Western oil companies, the International Monetary Fund, the World Bank and the United States Agency for International Development, and then sent to Iraq's Ministry of Oil.
As early as 2003, when Washington launched the Iraq war, a Gallup poll showed that 43 percent of Iraqis believed that the Americans were invading for the purpose of looting oil. Despite the US government and media trumpeting "democracy and freedom" and their failure to even mention oil, the desire for oil has long been argued and civilians have called for "no blood for oil".
The world's third largest oil holder, Iraq has proven reserves of 112.5 billion barrels and unproven reserves of an estimated 215 billion barrels, with the cost of tapping these reserves lower than US$1 per barrel. Once in control of Iraqi oil, not only will the US be confident of oil supply and the wallets of its oil dealers significantly fatter, but it will have another means by which to contain other economies. Further to that, Iraq's geographical location and water resources are also strategically important.
Although the US army is still catching its breath trying to cope with domestic unrest in Iraq, President Bush is claiming that "victory is around the corner". Final approval of this new law might signal his 'victory' and the smooth entry of big Western oil companies, protected by the US army, might indicate 'stability' in Iraq. However, it seems things are not that simple, given that from the very beginning oil facilities have been the target of militant attacks, with at least one signification kidnapping occurring every two days on average last year.
With the approval of the draft pending, Iraq's Prime Minister, Nouri al-Maliki, has expressed his concern that he will lose the support of the US and have to step down if the draft is not passed before parliament closes on June 30. Conversely, Iraqi trade union leaders and oil experts worry that the draft, once approved, will threaten national unity and sovereignty. The "federal oil and gas committee", on which representatives of big western companies sit, will decide the scale of production. Local entities will be able to trade directly with foreign oil dealers and as a result the nation will lose its central control on oil resources, giving way to sectarianism.
In his book, 'Confessions of an Economic Hit Man', John Perkins, an American, wrote that because Saddam had refused to accept the rules of the game, the 'economic hit man' was beaten in Iraq. Consequently, young American soldiers are killing and being killed in the deserts of Iraq.
The Iraq war began four years ago and today the Bush administration's true agenda has been exposed. As American journalists have long pointed out, the Bush family and its allies represent three sections of the American elite ¨C oil dealers, weapon traders and investors who work with one another and replace national interests with their own, even if they have to use force to do so. America as a global empire has gone so far down this path that no ruling party could possibly alter its military course, so this mammoth national machine continues to focus on building and maintaining a world in which the US controls resources, makes rules and gives orders.
By People's Daily Online