Anthony Sampson: Across the Middle East, autocratic regimes are being reinforced by rising oil prices

Western consumers are driving up petrol costs by being addicted to a fuel which comes from dangerous places

Anthony Sampson

The Independent

23 October 2004

As the world oil price rises still higher, motorists everywhere will soon be paying even more at the pump, and they will again be asking: who is to blame? The short answer is: 'you, the consumers, for becoming addicted to a fuel which comes from dangerous places.'

But there is a wider consequence of expensive petrol: the more consumers pay, the more they are enriching the producers, who include potential enemies. Many of the countries which are seen as most dangerous in the war against terror, have benefited most from the high oil price.

The Islamic rulers of Iran are now emerging as the next target for President Bush, as the would-be controllers of a nuclear power, the backers of Shia rebels in Iraq, and part of the "Axis of Evil". But thanks to Western motorists they have now found more billions to spend, to increase their arsenal and strengthen their hold on their people.

And across the Middle East and Central Asia all kinds of autocratic and undemocratic regimes are being reinforced by the rising oil price, from Syria to Kazakhstan.

While American and European governments are pressing them to democratise elections and abandon corruption, Western consumers are helping to subsidise them by driving up the oil price still further, thus making any pressure much less effective.

Saudi Arabia, which has the biggest oil reserves of all, has been under constant attack for its clandestine support for al-Qa'ida, and is subject to constant American pressure. Two years ago, its government was seriously strapped for cash: now it is awash with money, enriched both by higher oil prices and by record oil production

The British are not the worst culprits. They have been largely self-sufficient in oil and they pay heavy taxes at the pump, so they contribute comparatively little to foreign oil producers. Many other countries around the world can be blamed for the rising price, including Chinese oil consumers for increasing demand, and Iraqi insurgents and Nigerian strikers for interrupting supplies.

But it is the Americans, who are most wasteful of petrol and who rely increasingly on imported oil, who have been the leaders in forcing up the world oil price: while they refuse to countenance higher taxes to cut back their consumption. And it is George Bush who must be held responsible for the obvious contradiction in his policies: while he is constantly extending his list of enemy countries in the war on terror, he has done nothing to dissuade the American motorists from helping to finance them.

The danger has only just begun to dawn. "Of all the short-sighted policies of President Bush and Vice-President Cheney," wrote the American columnist Thomas Friedman in The New York Times two weeks ago, "none has been worse than the opposition to energy conservation and a gas tax".

But the contradiction is part of a much deeper predicament for Americans: while they are becoming increasingly anti-Muslim in their foreign policy, most of the world's oil remains within Islam. And Europeans have to be seriously concerned about their own future. Can they really be drawn into a growing confrontation with Islam, while they remain dependent on Islamic countries for their energy?

Many American Neo-Conservatives will answer yes: if necessary we must use force to protect our oil. The underlying assumption behind the invasion of Iraq was that the West could safeguard its oil supplies by decisive pressure and, if necessary, by military means.

But anyone who has followed the history of oil in the Middle East since the Second World War must know that military intervention is much harder than it appears.

In 1951, the British oilfields in Iran, then controlled by BP, were seized and nationalised by the Islamic revolutionary Dr Mossadeq. The British Labour foreign secretary, Herbert Morrison, argued that Britain should intervene by force, but he was countermanded by the Prime Minister, Clement Attlee, who realised the hostility it would provoke throughout the Arab world.

In the 1960s, the Americans, as they became more dependent on oil in the Middle East, were soon following an opposite policy of conciliating Arab governments, offering agreements which allowed them a greater share of the revenues. As they became more reliant on Saudi Arabia, their prize new source of oil, they were more determined to keep close to the Saudi royal family.

When in 1973 the oil powers, including Saudi Arabia, got together in Opec and quadrupled the price of oil, the Nixon administration considered - as we now know - the possibility of seizing the Saudi oilfields by force. But the idea was soon rejected as far too dangerous and impractical. Instead the oil companies actually co-operated with the Saudis in enforcing the embargo on oil to America and Britain.

After the trauma of 1973 the Americans and Europeans abandoned the idea of using military force. They found more oil outside the Middle East and Opec, and they realised that Opec would have to sell their oil to them anyway, to maintain their own revenues.

But the galloping oil consumption still left the West dangerously dependent on a few Islamic countries, led by Saudi Arabia. And in the Nineties the growth of fundamentalists presented a new danger: for they were prepared, if necessary, to forego their oil revenues.

The involvement of Saudis, led by Osama Bin Laden, in the attacks of 11 September 2001, changed the whole American view of the Middle East. It strengthened the political arguments for the use of force, and helped to persuade President Bush of the need to invade Iraq - partly to provide an alternative, safe source of oil, to balance the power of Saudi Arabia.

The Iraq war was, in the end, a war about oil: for without its oil Iraq would have been much less important to the Americans. It was not a war instigated by the oil companies, as many left-wing critics have assumed. The two chief British oil companies, BP and Shell, both warned the British government that it would threaten the security of oil supplies - which it did. But the war was part of Washington's new view that military force might be essential to safeguard American oil supplies. In fact, the use of force proved full of dangers. The invasion and occupation made Iraqi oil much less secure than before. The wave of anti-American feeling through the Muslim world has put relations with more oil producers at risk.

Now we are back with the inescapable fact: that while most of the oil consumers are in the West, most of the oil is in Islam. Our long-term security of oil supplies will depend on maintaining good relations with the crucial Muslim producers.

In the meantime, there is one immediate remedy to avert this danger: for Western consumers to cut back their oil consumption. The Americans are now at last beginning to recognise that their national security has a common cause with the interests of environmentalists and the Greens: they all need to reduce their dependence on this dangerous and addictive fuel. But they can only hope to achieve that goal if their next president dares to face the truth, and take a lead.