Oil’s well that ends well?


Friendly Fire
Khalid Saleem
IT says something for the topsy turvy world we live in that the gullible multitude in countries like our blessed land has taken in its stride the international price of crude going up and down like the proverbial yo-yo, lately, mercifully, down. The recent sinister goings on in the land of the pure involving, among other things, clandestine visits to lands like Qatar (and Kuwait?) by blue-eyed individuals spawned more questions than answers, though. Transparency, let us face it, has never been the forte of our powers that be!
Looking over the shoulder, the totally unpredictable world prices of oil have been playing havoc with the economies of the countries of the South for long now. In normal circumstances, the North would not bat an eyelid if the price of crude were to shoot through the proverbial ceiling. The only reason of interest to the Industrialised World (which was, in all probability, responsible for the erstwhile upward trend) is that the fluctuating price of crude happens to have a direct bearing on the price of gasoline in the American domestic market. We of the Land of the Pure are by now so benumbed that – having been hit by the price hike of several every day commodities – nothing appears to shock us any more.
The average American is, for reasons that will become obvious anon, extremely sensitive to the variations in the price of gasoline. If there is anything that a red-blooded American loves, it is the pleasure of driving around in what is lovingly called a “gas-guzzler”. Any unexpected adverse development in the availability and/or the cost of the coveted article (gas, in American parlance), thus, hits him or her where it hurts most. The American citizen looks upon the rising price of gas as not just hitting the pocketbook, but also what is considered to be his or her personal liberty.
A word about why any sharp rise in the price of oil should come as a particular jolt to the average red-blooded American would perhaps be in order. The whole thing is inexorably linked to the foreign policy as enunciated by the denizens of the US administration. There are quite a few who claim – and not without valid reason – that the Bush administration’s Iraq adventure was directly linked to its greed for oil. The pretext of presence (or otherwise) of Weapons of Mass Destruction aside, what possibly lured the Americans into the Iraq adventure was the opportunity it offered to gain complete and unchallenged control over the latter’s vast reserves of crude oil. Had the game plan worked as envisaged, the Americans could easily have cornered the world oil market. Regrettably, though, the best-laid plans of men (and mice) have the nasty habit at times of blowing up in the face.
Around the time of the Iraq invasion, then, there appeared to be this smug feeling in American administration circles that once the Iraqi oil wells had been “secured” and handed over to pre-selected American oil companies, the United States would be in the enviable position of being able to manipulate the world price of crude at its will, In fact, if for nothing else at least to afford a thrill to the average American owner of a gas-guzzler. The US airline industry also would not have been too displeased with such a development either. Things, regrettably, did not work out as planned, though.
When the news was flashed (circa March 2003) that the US administration had asked a small group of US companies to bid on a contract “to rebuild a post-war Iraq”, a Jeddah newspaper had made two tongue-in-cheek editorial comments: that (i) in order to afford opportunity to the selected companies to go about their business, Iraq would first have to be destroyed and (ii) the ownership of the Iraqi natural resource was “slated to pass directly from a despotic regime to the economic czars of Wall Street, by-passing the rightful owners – the deprived Iraqi populace!” One quotes this without comment, merely as food for thought.
Public memory is proverbially short. In the hullabaloo resulting from zigzagging price of the crude, no one even recalls now the saga of the oil price war of yore. The indelible story of the decades during which the industrialised countries made it a policy to shortchange the oil-producing countries is, of course, all but forgotten and is not referred to any more. Also conveniently hazy is the valiant struggle waged by the oil-producing countries to obtain a fair price for the black gold that nature had blessed them with. One trusts that some enterprising scribe has faithfully recorded that exciting period of the world’s history for posterity to ingest.
At the same time, one also hopes that someone would have had the courage and foresight to chronicle the feeble attempt of the other primary product producing countries to jump on to the bandwagon. In recording this episode, the infamous role played by the so-called multilateral diplomatists of the developing countries would hopefully receive due mention. It would be needless to go into detail. Suffice it to state that this body of self-serving individuals considered it expedient to place their personal ambitions above the interests of their respective countries. The sorry consequence was that what could have been a welcome and an historic opportunity to right the wrongs of the unjust post-World War II World Economic Order was, thereby, irretrievably lost. The rest, as they say, is history!
Since that time, the economic powers that be appear intent on manipulating the oil market (as they do all other markets) to their own benefit. With their blessings, the inequitable and unjust World Economic Regime continues on its destructive path with a vengeance. Mercifully, the historic injustice to the oil-producing countries was offset to a considerable extent. On their part, the industrialised countries quickly made up for their losses through further squeezing the poorer countries that, needless to add, emerged as the net losers in the Big Game. The condition of the other primary producing states, needless to add, went from bad to worse.
Harking back to the fluctuating price of crude, the common man can only grin and bear it. The new World Economic Order is anything but equitable. All that the WEO aims to do is to empower the powers that be to take all the decisions that matter as they think fit. The pity is that these are passed off as economic imperatives. All else is mere eyewash!— The writer is a former ambassador and former assistant secretary general of OIC.
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