Oil's role blemishes any noble motives for war

October 30, 2002|By JAY HANCOCK

THE CHEVRONTEXACO tanker pulled into Pascagoula, Miss., in August laden with 485,000 barrels of Iraqi crude.

As raw oil goes, the cargo was nothing special, soured as it was by 2.4 percent sulfur. But ChevronTexaco's refineries are better equipped than many to handle the contaminants common to the Iraqi product. They have been doing so for years, federal records show.

U.S. imports of Iraqi petroleum have surpassed pre-Persian Gulf war highs in recent years, and ChevronTexaco has been at the front of the parade, joining ExxonMobil and Valero Energy as big American clients for Baghdad.

Even before its merger with Texaco last year, Chevron had its eye on Iraq. Kenneth T. Derr, then Chevron's chairman, said in a 1998 speech, "I'd love Chevron to have access" for exploring and pumping Iraqi crude - not just buying it downstream under the United Nations' oil for food program, as happens now.

Since 1999 ChevronTexaco and its executives have given more than $1 million to the Republicans, the party of the president who is preparing to invade Iraq.

ChevronTexaco is the company whose board, until 1999, included Condoleezza Rice, President Bush's national security adviser. The corporation named one of its tankers after her. She calls Iraqi leader Saddam Hussein "an evil man."

Nobody in authority wants to say much about all this. But the pecuniary facts of the U.S-Iraq crisis are an ugly aspect of how it is seen by the world, a blemish on whatever nobler motives the administration may have, a lacing of corrosive sulfur in the purer hydrocarbon.

Iraq holds the world's second-biggest store of petroleum. The United States is the world's biggest consumer of petroleum.

Shut out of new fields in Alaska, hindered in re-entering Libya and Iran, and worried about political risk in Saudi Arabia, U.S. oil companies are presumably weighing their Iraq options just as diligently as they are avoiding talking about them.

"We won't speculate on what might happen in a post-Saddam scenario," says ChevronTexaco spokesman Chris Gidez. "There are just too many factors that play into it. We're refraining from getting into that game."

A recent report by Deutsche Bank's stock-research unit figures that oil-services outfits Schlumberger Ltd. and Halliburton Co. would quickly benefit from a Western victory in Iraq. Even if war damage was limited, this line of thinking goes, Iraq's wells and pipelines would require millions in new investment after decaying under years of economic sanctions.

If Halliburton, formerly run by Vice President Dick Cheney, plays its cards right and gives some impressive sales presentations, perhaps it will win some of the work.

But it's no lock that American companies would get most of the gravy in postwar Iraq.

Russia, China and France all have a keen desire to expand their Persian Gulf presence. They also have vetoes on the U.N. Security Council. Of course Washington, which may end up essentially governing postwar Iraq, will consider promises of oil access to win U.N. votes.

And, obviously, war in Iraq would pose huge risks to all oil companies with interests in the region, Americans included. Prolonged conflict could wreck pipelines and wells, disrupt the flow of crude and depress world demand.

And even easy victory wouldn't guarantee higher profits for anybody. Iraq's reserves are so vast that a fully productive Iraqi oil sector, after several years of investment and rehabilitation, could depress prices and profits worldwide.

I don't think oil is the main reason the United States wants to invade Iraq. The officials leading this charge, Cheney, Defense Secretary Donald H. Rumsfeld, Deputy Defense Secretary Paul D. Wolfowitz and Deputy National Security Adviser Stephen J. Hadley, are sincere hard-liners, idealistic in their way, who seem to believe that attacking Baghdad in the absence of an obvious, imminent threat is the lesser evil for Washington and the world.

Oil is not the motive. And U.S. petro-profits are not the guaranteed result. But that doesn't make this feel good. And it doesn't make it look good.

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