IRAN
What is likely to happen in Iran? It is extremely difficult to tell. It would seem that for some time now the United States has been lining that country up as one of its possible next targets after Afghanistan and Iraq. The immediate pretext for such an attack appears to center on Iran’s nuclear program, and although anti-Semitic/anti-Zionist/anti-Israeli declarations by Iran’s Prime Minister Ahmadinejad have also brought reactions from Israel, these reactions appear also to be connected to Iran’s nuclear program.

There is also the question of Iran’s proposed oil bourse, set to open in March, which will lead to that country’s oil prices being priced in euros instead of dollars. This matter, another possible pretext for the particular armed interventionist trajectory adopted by the United States since 2001, has been under discussion for some time now¹. But would such a strategy really undermine U.S. economic dominance?

Meanwhile, Russia and China have important economic relations with Iran – China is one of its largest buyers of oil, while, nota bene, Russia has a $1 billion stake in the building of Iran’s first atomic reactor. Europe and Japan, among others have many interests in Iran.

The CIA World Factbook gives the following information:

Iran’s largest importers: Japan 18.4%, China 9.7%, Italy 6%, South Africa 5.8%, South Korea 5.4%, Taiwan 4.6%, Turkey 4.4%, Netherlands 4% (2004). Iran’s largest exporters: Germany 12.8%, France 8.3%, Italy 7.7%, China 7.2%, UAE 7.2%, South Korea 6.1%, Russia 5.4 percent² (2004). The absence of the Unites States from either of these categories is noticeable³.

Historically, incidents such as the present one in the Middle East and in the other major oil-producing States have led to strong language that has contributed to rising oil prices. This is happening again today. But can it be argued that the whole thing is a conspiracy between the leaders of Iran, Israel and the United States to push up oil prices? If so, why –why now? How does this serve Capital’s greater interests?

Yes, the oil corporations like high oil prices. But why should this be happening now? We haven’t got all the answers. However, we need to step back and ask ourselves if U.S. policy really centers so simplistically on oil. Perhaps, we should be thinking about world power, about long-term strategy…

Looking back at the 1970s, when oil prices shot up by almost 1,000%, we also notice that a serious crisis of overproduction was occurring as America’s dominance in world markets was challenged by the recovery of production and the growth of productivity in Europe, Japan and elsewhere⁴. This was followed in the 1980s by a massive build-up of armed might by the United States, and although no major war was precipitated under Reagan’s government, the military-industrial complex took a lurch forward (with its “Star Wars” plan). The dramatic events in Russia and Eastern Europe removed America’s previous pretext for a massive military economy, and the Bush regime ushered in the 1990s with its Gulf War against Iraq.

Clearly, we have to reserve our opinions on the present situation, although we certainly do not rule out another military conflict. However, we do not know whether an engagement is being contemplated in the short term –or what form it might eventually take. Commentators have been noting for some time that if the United States desires to transform the situation in Iran to something more amenable to its global strategy, means other than those used in Afghanistan and Iraq would be better –e.g. financing the pro-Western opposition there to overthrow the Mullahs. None of this can be taken at face-value, however, in the first place because none of the pretexts used to justify US aggression anywhere have turned out to be true. Diplomacy and intrigue are giving way bit by bit and here and there to armed confrontation, not because the first two do not work, but because Capital’s dilemma has changed.

It would be worth asking what comes first: oil, war, imperialist power or America’s worldwide competitiveness and hence productivity, including the battle for scientific innovativeness, where America is losing on many fronts –except, generally speaking, on the military front. Mario Pianta’s book indicates the importance of this final factor.

However, since Pianta’s book, U.S. globalization has led to such “paradoxical” situations as the fact that many U.S. imports (and hence America’s trade deficit) are exported by U.S. transnationals based in other countries, including that huge and rapidly growing rival, China.

U.S: OIL STRATEGY AND OIL ABUNDANCE
A paper by John Hopkins’ researcher Roger J. Stern⁵ argues that U.S. policy in the Middle East is totally misguided if it is based on fears that the region could cut off America’s energy supplies. Stern’s data point to an abundance of untapped oil reserves. He states:

“We hypothesize that threats do arise in the oil market, not from the oil weapon, but from the cartel’s management of abundance… If oil were scarce, the cost to recover it should rise over time. The opposite has occurred.”

Among other things, he notes that:

“...only 17 of 80 Iraqi fields are in production…. Iraq may possess ‘reservoirs that have been completely overlooked’... [while] much of Iraq has not been explored at all. Similarly, of 80 Saudi reservoirs, only 23 are in production.”

While arguing against the idea that petroleum exhaustion and the use of scarce oil as weapon in the hands of the oil-producing States are the factors behind America’s stance on the Middle East, Stern proposes that it is the wealth transfer to the OPEC States which may pose a threat to security because it may be used to finance international terrorism. Although we do not agree with the latter argument (as we make clear in our commentary on Iran above), we think Stern has made a contribution to our understanding of some of the issues behind the present world situation by unearthing and analyzing facts about oil abundance and its history.

LATIN AMERICAN OIL PIPELINE
Last week, three of Latin America’s left-of-center Heads of State – Nestor Kirchner of Argentina, Luiz Inacio Lula da Silva of Brazil and Hugo Chavez of Venezuela –announced that they would work together in a plan to build an 8,000 kilometer gas pipeline from Venezuela to connect nine Latin American countries –Argentina, Bolivia, Brazil, Colombia, Chile, Paraguay, Peru, Uruguay and Venezuela. Although social demagoguery is a noticeable element in Latin America’s leftward shift, the situation is worth following. Oil is one of the big issues that is creating conflicts with imperialist capital, which fears the energy independence of nations throughout the world will undermine its global search for markets and overall dominance. It seems likely that the conflict in Latin America over the region’s resources will intensify in the future.

NOTES:

¹ An early example is Peter Dale Scott’s Bush’s Deep Reasons for War on Iraq: Oil, Petrodollars, and the OPEC Euro Question (Updated 5/27/03) http://ist-socrates.berkeley.edu/~pdscott/iraq.html. A recent article on this theme is by Krassimir Petrov The Proposed Iranian Oil Bourse, January 15, 2006.
See: http://www.informationclearinghouse.info/article11613.htm
See also: William Clark’s, The Real Reasons Why Iran is the Next Target: The Emerging Euro-denominated International Oil Marker http://globalresearch.ca/articles/CLA410A.html 27 October 2004

² CIA World Factbook

³ Kaveh L Afrasiabi’s article, Russia’s Iran gamble in the Asia Times notes that despite Russia’s important economic interests in Iran, the Russian government in its desire to appease Israel is being forced to “send strong signals that Iran can no longer count on traditional Russian support in view of the “unacceptable policy positions” of Iranian President Mahmud Ahmadinejad regarding Israel, among other things”. The predominance of powers other than the United States in Iran suggests that there are strong grounds for believing the conflict is part of a proxy war against America’s more important rivals.
See: http://www.atimes.com/atimes/Middle_East/HA18Ak02.html

⁴ See Mario Pianta’s New technologies across the Atlantic: US Leadership or European Autonomy? http://tinyurl.com/czxnm

⁵ See Oil market power and United States national security, Proceedings of the National Academy of Sciences (PNAS), January 16-20, 2006.
http://www.pnas.org/cgi/reprint/0503705102v1