Subject: Oil, Geopolitics, and the Coming War with Iran Date: Tue, 12 Apr 2005 23:54:39 -0500 Message-ID: <B14120EE5C432443B21102F7925DAD0201420857@COKE.uwec.edu> From: "Grossman, Zoltan C." <GROSSMZC@uwec.edu>
Oil, Geopolitics, and the Coming War with Iran
By Michael Klare
April 11, 2005
http://www.tomdispatch.com
[Michael T. Klare is a professor of peace and world
security studies at Hampshire College and the author of
Blood and Oil: The Dangers and Consequences of
America's Growing Dependency on Imported Oil
(Metropolitan Books).]
As the United States gears up for an attack on Iran,
one thing is certain: the Bush administration will
never mention oil as a reason for going to war. As in
the case of Iraq, weapons of mass destruction (WMD)
will be cited as the principal justification for an
American assault. "We will not tolerate the
construction of a nuclear weapon [by Iran]," is the way
President Bush put it in a much-quoted 2003 statement.
But just as the failure to discover illicit weapons in
Iraq undermined the administration's use of WMD as the
paramount reason for its invasion, so its claim that an
attack on Iran would be justified because of its
alleged nuclear potential should invite widespread
skepticism. More important, any serious assessment of
Iran's strategic importance to the United States should
focus on its role in the global energy equation.
Before proceeding further, let me state for the record
that I do not claim oil is the sole driving force
behind the Bush administration's apparent determination
to destroy Iranian military capabilities. No doubt
there are many national security professionals in
Washington who are truly worried about Iran's nuclear
program, just as there were many professionals who were
genuinely worried about Iraqi weapons capabilities. I
respect this. But no war is ever prompted by one factor
alone, and it is evident from the public record that
many considerations, including oil, played a role in
the administration's decision to invade Iraq. Likewise,
it is reasonable to assume that many factors -- again
including oil -- are playing a role in the decision-
making now underway over a possible assault on Iran.
Just exactly how much weight the oil factor carries in
the administration's decision-making is not something
that we can determine with absolute assurance at this
time, but given the importance energy has played in the
careers and thinking of various high officials of this
administration, and given Iran's immense resources, it
would be ludicrous not to take the oil factor into
account -- and yet you can rest assured that, as
relations with Iran worsen, American media reports and
analysis of the situation will generally steer a course
well clear of the subject (as they did in the lead-up
to the invasion of Iraq).
One further caveat: When talking about oil's importance
in American strategic thinking about Iran, it is
important to go beyond the obvious question of Iran's
potential role in satisfying our country's future
energy requirements. Because Iran occupies a strategic
location on the north side of the Persian Gulf, it is
in a position to threaten oil fields in Saudi Arabia,
Kuwait, Iraq, and the United Arab Emirates, which
together possess more than half of the world's known
oil reserves. Iran also sits athwart the Strait of
Hormuz, the narrow waterway through which, daily, 40%
of the world's oil exports pass. In addition, Iran is
becoming a major supplier of oil and natural gas to
China, India, and Japan, thereby giving Tehran
additional clout in world affairs. It is these
geopolitical dimensions of energy, as much as Iran's
potential to export significant quantities of oil to
the United States, that undoubtedly govern the
administration's strategic calculations.
Having said this, let me proceed to an assessment of
Iran's future energy potential. According to the most
recent tally by Oil and Gas Journal, Iran houses the
second-largest pool of untapped petroleum in the world,
an estimated 125.8 billion barrels. Only Saudi Arabia,
with an estimated 260 billion barrels, possesses more;
Iraq, the third in line, has an estimated 115 billion
barrels. With this much oil -- about one-tenth of the
world's estimated total supply -- Iran is certain to
play a key role in the global energy equation, no
matter what else occurs.
It is not, however, just sheer quantity that matters in
Iran's case; no less important is its future productive
capacity. Although Saudi Arabia possesses larger
reserves, it is now producing oil at close to its
maximum sustainable rate (about 10 million barrels per
day). It will probably be unable to raise its output
significantly over the next 20 years while global
demand, pushed by significantly higher consumption in
the United States, China, and India, is expected to
rise by 50%. Iran, on the other hand, has considerable
growth potential: it is now producing about 4 million
barrels per day, but is thought to be capable of
boosting its output by another 3 million barrels or so.
Few, if any, other countries possess this potential, so
Iran's importance as a producer, already significant,
is bound to grow in the years ahead.
And it is not just oil that Iran possesses in great
abundance, but also natural gas. According to Oil and
Gas Journal, Iran has an estimated 940 trillion cubic
feet of gas, or approximately 16% of total world
reserves. (Only Russia, with 1,680 trillion cubic feet,
has a larger supply.) As it takes approximately 6,000
cubic feet of gas to equal the energy content of 1
barrel of oil, Iran's gas reserves represent the
equivalent of about 155 billion barrels of oil. This,
in turn, means that its combined hydrocarbon reserves
are the equivalent of some 280 billion barrels of oil,
just slightly behind Saudi Arabia's combined supply. At
present, Iran is producing only a small share of its
gas reserves, about 2.7 trillion cubic feet per year.
This means that Iran is one of the few countries
capable of supplying much larger amounts of natural gas
in the future.
What all this means is that Iran will play a critical
role in the world's future energy equation. This is
especially true because the global demand for natural
gas is growing faster than that for any other source of
energy, including oil. While the world currently
consumes more oil than gas, the supply of petroleum is
expected to contract in the not-too-distant future as
global production approaches its peak sustainable level
-- perhaps as soon as 2010 -- and then begins a gradual
but irreversible decline. The production of natural
gas, on the other hand, is not likely to peak until
several decades from now, and so is expected to take up
much of the slack when oil supplies become less
abundant. Natural gas is also considered a more
attractive fuel than oil in many applications,
especially because when consumed it releases less
carbon dioxide (a major contributor to the greenhouse
effect).
No doubt the major U.S. energy companies would love to
be working with Iran today in developing these vast oil
and gas supplies. At present, however, they are
prohibited from doing so by Executive Order (EO) 12959,
signed by President Clinton in 1995 and renewed by
President Bush in March 2004. The United States has
also threatened to punish foreign firms that do
business in Iran (under the Iran-Libya Sanctions Act of
1996), but this has not deterred many large companies
from seeking access to Iran's reserves. China, which
will need vast amounts of additional oil and gas to
fuel its red-hot economy, is paying particular
attention to Iran. According to the Department of
Energy (DoE), Iran supplied 14% of China's oil imports
in 2003, and is expected to provide an even larger
share in the future. China is also expected to rely on
Iran for a large share of its liquid natural gas (LNG)
imports. In October 2004, Iran signed a $100 billion,
25-year contract with Sinopec, a major Chinese energy
firm, for joint development of one of its major gas
fields and the subsequent delivery of LNG to China. If
this deal is fully consummated, it will constitute one
of China's biggest overseas investments and represent a
major strategic linkage between the two countries.
India is also keen to obtain oil and gas from Iran. In
January, the Gas Authority of India Ltd. (GAIL) signed
a 30-year deal with the National Iranian Gas Export
Corp. for the transfer of as much as 7.5 million tons
of LNG to India per year. The deal, worth an estimated
$50 billion, will also entail Indian involvement in the
development of Iranian gas fields. Even more
noteworthy, Indian and Pakistani officials are
discussing the construction of a $3 billion natural gas
pipeline from Iran to India via Pakistan ? an
extraordinary step for two long-term adversaries. If
completed, the pipeline would provide both countries
with a substantial supply of gas and allow Pakistan to
reap $200-$500 million per year in transit fees. "The
gas pipeline is a win-win proposition for Iran, India,
and Pakistan," Pakistani Prime Minister Shaukat Aziz
declared in January.
Despite the pipeline's obvious attractiveness as an
incentive for reconciliation between India and Pakistan
-- nuclear powers that have fought three wars over
Kashmir since 1947 and remain deadlocked over the
future status of that troubled territory -- the project
was condemned by Secretary of State Condoleezza Rice
during a recent trip to India. "We have communicated to
the Indian government our concerns about the gas
pipeline cooperation between Iran and India," she said
on March 16 after meeting with Indian Foreign Minister
Natwar Singh in New Delhi. The administration has, in
fact, proved unwilling to back any project that offers
an economic benefit to Iran. This has not, however,
deterred India from proceeding with the pipeline.
Japan has also broken ranks with Washington on the
issue of energy ties with Iran. In early 2003, a
consortium of three Japanese companies acquired a 20%
stake in the development of the Soroush-Nowruz offshore
field in the Persian Gulf, a reservoir thought to hold
1 billion barrels of oil. One year later, the Iranian
Offshore Oil Company awarded a $1.26 billion contract
to Japan's JGC Corporation for the recovery of natural
gas and natural gas liquids from Soroush-Nowruz and
other offshore fields.
When considering Iran's role in the global energy
equation, therefore, Bush administration officials have
two key strategic aims: a desire to open up Iranian oil
and gas fields to exploitation by American firms, and
concern over Iran's growing ties to America's
competitors in the global energy market. Under U.S.
law, the first of these aims can only be achieved after
the President lifts EO 12959, and this is not likely to
occur as long as Iran is controlled by anti-American
mullahs and refuses to abandon its uranium enrichment
activities with potential bomb-making applications.
Likewise, the ban on U.S. involvement in Iranian energy
production and export gives Tehran no choice but to
pursue ties with other consuming nations. From the Bush
administration's point of view, there is only one
obvious and immediate way to alter this unappetizing
landscape -- by inducing "regime change" in Iran and
replacing the existing leadership with one far
friendlier to U.S. strategic interests.
That the Bush administration seeks to foster regime
change in Iran is not in any doubt. The very fact that
Iran was included with Saddam's Iraq and Kim Jong Il's
North Korea in the "Axis of Evil" in the President's
2002 State of the Union Address was an unmistakable
indicator of this. Bush let his feelings be known again
in June 2003, at a time when there were anti-government
protests by students in Tehran. "This is the beginning
of people expressing themselves toward a free Iran,
which I think is positive," he declared. In a more
significant indication of White House attitudes on the
subject, the Department of Defense has failed to fully
disarm the People's Mujaheddin of Iran (or Mujaheddin-e
Khalq, MEK), an anti-government militia now based in
Iraq that has conducted terrorist actions in Iran and
is listed on the State Department's roster of terrorist
organizations. In 2003, the Washington Post reported
that some senior administration figures would like to
use the MEK as a proxy force in Iran, in the same
manner that the Northern Alliance was employed against
the Taliban in Afghanistan.
The Iranian leadership is well aware that it faces a
serious threat from the Bush administration and is no
doubt taking whatever steps it can to prevent such an
attack. Here, too, oil is a major factor in both
Tehran's and Washington's calculations. To deter a
possible American assault, Iran has threatened to close
the Strait of Hormuz and otherwise obstruct oil
shipping in the Persian Gulf area. "An attack on Iran
will be tantamount to endangering Saudi Arabia, Kuwait,
and, in a word, the entire Middle East oil," Iranian
Expediency Council secretary Mohsen Rezai said on March
1st.
Such threats are taken very seriously by the U.S.
Department of Defense. "We judge Iran can briefly close
the Strait of Hormuz, relying on a layered strategy
using predominantly naval, air, and some ground
forces," Vice Admiral Lowell E. Jacoby, the director of
the Defense Intelligence Agency, testified before the
Senate Intelligence Committee on February 16th.
Planning for such attacks is, beyond doubt, a major
priority for top Pentagon officials. In January,
veteran investigative reporter Seymour Hersh reported
in the New Yorker magazine that the Department of
Defense was conducting covert reconnaissance raids into
Iran, supposedly to identify hidden Iranian nuclear and
missile facilities that could be struck in future air
and missile attacks. "I was repeatedly told that the
next strategic target was Iran," Hersh said of his
interviews with senior military personnel. Shortly
thereafter, the Washington Post revealed that the
Pentagon was flying surveillance drones over Iran to
verify the location of weapons sites and to test
Iranian air defenses. As noted by the Post, "Aerial
espionage [of this sort] is standard in military
preparations for an eventual air attack." There have
also been reports of talks between U.S. and Israeli
officials about a possible Israeli strike on Iranian
weapons facilities, presumably with behind-the-scenes
assistance from the United States.
In reality, much of Washington's concern about Iran's
pursuit of WMD and ballistic missiles is sparked by
fears for the safety of Saudi Arabia, Kuwait, Iraq,
other Persian Gulf oil producers, and Israel rather
than by fears of a direct Iranian assault on the United
States. "Tehran has the only military in the region
that can threaten its neighbors and Gulf security,"
Jacoby declared in his February testimony. "Its
expanding ballistic missile inventory presents a
potential threat to states in the region." It is this
regional threat that American leaders are most
determined to eliminate.
In this sense, more than any other, the current
planning for an attack on Iran is fundamentally driven
by concern over the safety of U.S. energy supplies, as
was the 2003 U.S. invasion of Iraq. In the most telling
expression of White House motives for going to war
against Iraq, Vice President Dick Cheney (in an August
2002 address to the Veterans of Foreign Wars) described
the threat from Iraq as follows: "Should all [of
Hussein's WMD] ambitions be realized, the implications
would be enormous for the Middle East and the United
States.... Armed with an arsenal of these weapons of
terror and a seat atop 10 percent of the world's oil
reserves, Saddam Hussein could then be expected to seek
domination of the entire Middle East, take control of a
great portion of the world's energy supplies, [and]
directly threaten America's friends throughout the
region." This was, of course, unthinkable to Bush's
inner circle. And all one need do is substitute the
words "Iranian mullahs" for Saddam Hussein, and you
have a perfect expression of the Bush administration
case for making war on Iran.
So, even while publicly focusing on Iran's weapons of
mass destruction, key administration figures are
certainly thinking in geopolitical terms about Iran's
role in the global energy equation and its capacity to
obstruct the global flow of petroleum. As was the case
with Iraq, the White House is determined to eliminate
this threat once and for all. And so, while oil may not
be the administration's sole reason for going to war
with Iran, it is an essential factor in the overall
strategic calculation that makes war likely.
Copyright 2005 Michael T. Klare
This piece first appeared at TomDispatch.com