Liberation? It's about the oil, stupid!

I'm sure the Iraqis, enmeshed as they are in civil war, have almost forgotten about what it is they've got that the US wants... lots of oil. But those lovely guys (and gal) at the Iraq Study Group certainly havent, and in all the fuss about "staying the course" versus "cutting and running", some of their recommendations have received little publicity, which is a shame, because I think they're somewhat important.

This article exposes some of the business links between ISG members and the multinationals. James Baker works for legal firm Baker, Botts, who were voted the oil companies' favourite firm for 2006. Lawrence Eagleburger worked for Kissinger Associates who, in the good old days when Saddam was our pal, were hooked into the money stream.

And it seems that despite all the problems attendant in getting the oil out of the ground and out of the country in a land ravaged by sectarian bloodshed and insurgency against the occupying powers, they've still got their eyes on the prize.

The report calls for the United States to assist in privatizing Iraq's national oil industry, opening Iraq to private foreign oil and energy companies, providing direct technical assistance for the "drafting" of a new national oil law for Iraq, and assuring that all of Iraq's oil revenues accrue to the central government.

President Bush hired an employee from the U.S. consultancy firm Bearing Point Inc. over a year ago to advise the Iraq Oil Ministry on the drafting and passage of a new national oil law. As previously drafted, the law opens Iraq's nationalized oil sector to private foreign corporate investment, but stops short of full privatization. The ISG report, however, goes further, stating that "the United States should assist Iraqi leaders to reorganize the national oil industry as a commercial enterprise." In addition, the current Constitution of Iraq is ambiguous as to whether control over Iraq's oil should be shared among its regional provinces or held under the central government. The report specifically recommends the latter: "Oil revenues should accrue to the central government and be shared on the basis of population." If these proposals are followed, Iraq's national oil industry will be privatized and opened to foreign firms, and in control of all of Iraq's oil wealth.

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This past July, U.S. Energy Secretary Bodman announced in Baghdad that senior U.S. oil company executives would not enter Iraq without passage of the new law. Petroleum Economist magazine later reported that U.S. oil companies put passage of the oil law before security concerns as the deciding factor over their entry into Iraq. Put simply, the oil companies are trying to get what they were denied before the war or at anytime in modern Iraqi history: access to Iraq's oil under the ground. They are also trying to get the best deal possible out of a war-ravaged and occupied nation. However, waiting for the law's passage and the need to guarantee security of U.S. firms once they get to work, may well be a key factor driving the one proposal by the Iraq Study Group that has received great media attention: extending the presence of U.S. troops in Iraq at least until 2008.