At the fifth annual conference of ASPO (the Association for the Study of Peak Oil), held in July in Pisa, Italy, there were many excellent presentations, one of which I will report on at some length below.
But the timing of the conference proved ominous. During two weeks of travel in Italy I had only occasional access to the Internet or to other news sources, and heard only sporadic reports on the unfolding crisis in Israel, Gaza, and Lebanon. Back home, I quickly caught up on the events.
The situation clearly requires comment, as it has enormous implications both for the world as a whole and for the small but growing community of people involved in preparations for Peak Oil. Mainstream reporting seems to miss much of the context of events and, when discussing the Middle East, the geopolitical struggle for control of energy resources nearly always forms much of that context.
Israel / Palestine / Hezbollah / Lebanon
It seems useful to start by recounting a timeline of the crisis, but that’s not as easy as it sounds. Where does one start? What incidents should be mentioned or not mentioned? The following is my best effort, but may strike some as incomplete or skewed.
In elections held last year, the Palestinian people voted in a Hamas government, which came to power in January. Israel and the US responded by refusing to recognize the new government’s legitimacy; since then, there has been a steady escalation of tensions between Israel and the Palestinian authority.
On June 24 Israeli soldiers kidnapped a Palestinian doctor and his brother in Gaza and removed them to some unspecified detention facility. This would not be a particularly noteworthy event, except for the fact that on the following day militants in Gaza—perhaps in retaliation—kidnapped an Israeli soldier.
Israel responded with dramatically intensified attacks on Gaza.
Then, on July 12, Hezbollah—a political and military Shia Muslim organization based in Lebanon—captured two Israeli soldiers and killed six others. According to the official Israeli version of the story, this occurred during a cross-border raid by Hezbollah into northern Israel. However, early press accounts said that Israel had sent a commando force into southern Lebanon; these commandoes, operating near the village of Aitaa al-Chaab inside Lebanon’s southern territory, were then allegedly engaged by Hezbollah fighters, who struck an Israeli tank.
In either case, over the next days and weeks Hezbollah fired hundreds of rockets into Israel, killing dozens and wounding many more, while Israel bombed southern Lebanon, using (according to some reports) chemical weapons and cluster bombs, killing hundreds and destroying roads, bridges, power stations, and other civilian infrastructure.
US Secretary of State Condoleeza Rice traveled to Lebanon on July 23, but not to broker a ceasefire; instead she called a ceasefire “premature.” In Washington she had said that Israel should ignore calls for a ceasefire; en route to Beirut she honed the message: while there was an “urgent” need for peace, conditions had to be right. In Beirut Rice explained that those “right” conditions consisted essentially of the satisfaction of Israel’s goals in the conflict; she also called for the creation of “a new Middle East”—a phrase that can inspire little hope or comfort in the inhabitants of the region, given what the US has accomplished in Iraq during the past three years. While no one would say so, it was obvious to nearly everyone that the US was refusing to call for a ceasefire to give Israel time to conclude its operations.
On July 26, Israel bombed a UN observer post in Lebanon, killing four. Then, on July 30, Israeli bombs killed 54 civilians (mostly women and children) in Qana, raising such international outrage that Israel felt compelled to suspended most of its bombing campaign for 48 hours.
As of this writing, Rice is proposing a ceasefire to be implemented on condition of the banning of arms sales to Hezbollah, the moving of the Lebanese army to the southern region, and the creation of an international force as a backup. There is no mention, in this proposal for a “lasting” peace, of an Israeli pullback from Gaza or the release of hundreds of Lebanese prisoners. Meanwhile, Israel has commenced a large-scale ground offensive that seems likely to continue for at least a couple of weeks.
This is more or less what we know—given the differences in the versions being rehearsed by news outlets and government officials. But there is much that is even less clear: Why is this happening now? What are the motives of Israel, Hezbollah, and the US? And in what direction are the events headed?
Hezbollah’s initial motive seems principally to have been to gain a couple of Israeli hostages to use as bargaining chips in exchange for Lebanese, Palestinian, and Hezbollah prisoners held in Israel. Hezbollah’s leader, Sheik Hussein Nasrallah, made it perfectly clear months prior to the commencement of the current hostilities that this was the plan. Secondarily, Hezbollah wishes to support the embattled Palestinians in Gaza. There are those who have suggested that Hezbollah was acting at the behest of Iran in order to deflect international attention from that nation’s nuclear research program (more on that below), but this suggestion seems far-fetched.
It would be a mistake to probe only Hezbollah’s motives in the conflict while assuming (as most American politicians and news outlets do) that Israel is merely responding self-defensively to a situation imposed upon it. First, there is the legitimate question as to whether Israel provoked the conflict through its own cross-border incursion; then there is an article published in the San Francisco Chronicle on July 21 (“Israel Set War Plan More than a Year Ago,” by Matthew Kalman), detailing how Israel’s campaign against Hezbollah in Lebanon was in fact planned months in advance, merely requiring a proximate trigger. If this is the case, then it is Israel’s motives that we should probe first and foremost. According to leftist international affairs commentator Pepe Escobar, in “The Spirit of Resistance” (Asia Times, July 26, www.atimes.com/atimes/Middle_East/HG26Ak02.html),
As far as Lebanon is concerned, Israel wants nothing less than a permanent buffer zone on its northern flank. And if Lebanon turns into an Iraq, even better—although the Lebanese have learned the hard way about sectarianism and won’t “Iraqify” their own country. Beirut will be rebuilt—again, and again the Hariri clan (with its dodgy deals with the US and the Saudis) will plunge Lebanon in further debt purgatory with regard to the International Monetary Fund and the World Bank, as the clan did in the previous reconstruction process. There’s also the all-important matter of the waters of the Litani River in southern Lebanon. Israel might as well prepare the terrain now for the eventual annexation of the Litani. Beyond Lebanon, Israel is mostly interested also in Syria. The motive: the all-important pipeline route from Kirkuk, in Iraqi Kurdistan, to Haifa. Enter Israel as a major player in Pipelineistan. So Israel wants to grab water (and territory) from Palestine, water (and territory) from Lebanon, and oil from Iraq. This all has to do with the inevitable—the 21st-century energy wars.
While the US is not a direct participant in the conflict, its own aims cannot be ignored. These, according to Escobar, include “cutting off Hezbollah from Lebanese society,” which would in turn “lead to a vulnerable Syria extricating itself from a close relationship with Iran.” In the short term, the United States would like Israel to wipe out Hezbollah, allow the Lebanese government to send its troops to the south of the country, ensure the safety of northern Israel, cut Syria’s influence down to size, and apply greater pressure on Hezbollah-supporting Iran. In the longer term, Washington apparently wants to redraw the political and ideological map of the Middle East in ways set forth in various neoconservative planning documents, regardless of the cost to locals.
Currently, between Israel and Hezbollah, it is unclear whose goals are being accomplished more fully—although on balance it would seem that Hezbollah has had the upper hand so far (this view appears to hold across the international political spectrum). Israel’s devastating attacks seem not to have turned Lebanese society against the militant organization; moreover, Hezbollah’s Viet Cong-style guerilla campaign appears to be succeeding, as merely to survive the sustained Israeli atttack can be counted a victory. As Israel’s ground assault continues, that assessment could change.
But what are the longer-term implications? Where is all of this headed? It may be impossible to assess the situation merely by reference to the current combatants; we must take into account the other trends in the region and how this conflict may play into them.
Iran: Will the US Attack Before November?
At the ASPO conference a riveting presentation was delivered by Terence Ward, a writer (Searching for Hassan) who grew up in Iran and is currently a cross-cultural consultant for businesses, foundations, and governments in the Islamic World and the West. Ward believes that a US bombing attack on Tehran is nearly inevitable (a view that I put forward in MuseLetter #155, March 2005, “Onward to Iran”), and that it will have devastating consequences for the region and for the world.
He began by reminding the audience that there is no clear proof of an Iranian nuclear weapons program, and that what the US and Israel have pointed to as evidence falls short of what would be needed to publicly justify pre-emptive military action. The central question hanging over the proposals and counter-proposals involving the US, Iran, the UN Security Council, and other interested parties including Russia and China, is this: What if both the US and Iranian presidents seek confrontation and war?
Sure enough, on August 1 the US was able to obtain a UN Security Council resolution giving Iran 30 days to end its uranium enrichment program (otherwise permitted by the Nuclear Non-Proliferation Treaty)—which it seems unlikely to do. Events appear to have achieved a relentless, irrational momentum in a direction all too reminiscent of those in the weeks leading up to the 2003 US invasion of Iraq.
Why would the US administration want confrontation with Iran? Perhaps that country represents an essential next step, following “regime change” in Iraq, in the project of remaking the Middle East. From a geopolitical point of view, Iran is located at the juncture of the Middle East and Central Asia. Not only are its own reserves of oil and gas considerable, but it controls access to the Persian Gulf. Iran is thus crucial to oil and gas transshipment routes to Europe, Japan, and the rest of the world.
Neoconservatives appear to believe that, as soon as the bombing commences, Iranians will rise up en masse to overthrow their humiliated rulers—just as they believed that the Iraqi people would welcome an American effort to completely reshape their country’s economy and political system following the invasion.
Ward speculates that Mr. Bush may bomb before the November elections in order to preserve his Republican majority in Congress. However, the US military is already under enormous strain, and would be unable to deal with likely chain reactions following an air attack; and the likely response of the American people is difficult to gauge.
Why might the Iranian leaders want confrontation? Ward made the important point that the current Tehran regime is even less popular domestically than is its US counterpart among Americans. This is shown in the remarkable statistic that, according to a report by the Islamic Republic’s Ministry of Culture and Guidance, less than two percent of the population attends Friday prayers regularly. Ahmadinejad, whose support comes almost entirely from the dwindling ranks of religious fundamentalists, is in power only because his opponent in the most recent election rendered himself utterly odious through blatant corruption.
Iranian hard-liners believe the US bombing will enrage and unite their people. Lacking a strong popular base, the Tehran regime has seized upon “nuclear nationalism” as a way of gaining legitimacy with the masses—just as Bush and company seized upon the issue of national security following 9/11. Ahmadinejad and his cohorts evidently believe that, in the event of an American attack, the Iranian people will rally behind their government, thus injecting new life into the Islamic revolution. In confronting the US and Israel, the hard-liners also expect to be propelled to the forefront of the radical Muslim world.
Iranian exiles, who number roughly two million, generally loathe the current regime and look forward to its collapse, yet fear a conflict with the US, according to Ward. They say the bombing will not only leave the country in ruins, but will play into the hands of the hard-liners.
In discussing the likely scope of the air campaign, Ward foresees a bombing lasting two weeks, targeting 1,000 sites including sea ports, missile defense systems, military bases, airports, industries, and 20 nuclear facilities.
Iran’s response is not hard to guess. The nation has hundreds of undeclared dock and port facilities along its Persian Gulf coast. The Iranian Navy recently conducted exercises in the Strait of Hormuz, in which a thousand small Iranian boats simulated attacks on American ships. The Strait is the world’s only access point for millions of barrels per day of OPEC oil. The passage of tankers through this narrow waterway would almost certainly be interrupted for days, weeks, and perhaps months if hostilities erupted.
An attack on Tehran would also unleash an enormous backlash against the US in Shia areas of Iraq, possibly making the American presence in that country untenable. The Iranians’ capabilities in this regard have not been lost on US military leaders. According to Ward, from American military leaders’ perspective this is a mission from hell. The Pentagon brass are uncertain what targets to attack, because American and European intelligence agencies have found no specific evidence of clandestine activities or hidden facilities.
Thus it would be virtually impossible to gain confirmation of the effectiveness of air strikes in eliminating Iran’s nuclear program. Recently, General Pace, head of the Joint Chiefs of Staff, apparently forced the White House to agree not to use nuclear weapons in its planned bombing campaign. This rebellion by the military has infuriated the White House.
Ward also provided a helpful perspective on the Shia-Sunni divide in Middle East. He noted that the bulk of oil reserves on the planet lie in Shia territory:
The Shia of Saudi Arabia would love to have the same control over their oil revenues as their Shia brothers in Iraq. Long oppressed by the Sunni Wahhabi rulers, these Shia go on pilgrimage to Iran and will react in subtle and overt ways if Iran is attacked. Bahrain is over 95% Shia and has experienced unrest before along the Shia/Sunni divide. Dubai is a large center of Persian-speakers and Iranian influence. Kuwait is also 30% Shia. In Aramco and KOC, the Shia vastly represent the local skilled labor force. An incident like the attempt on the Abqaiq collection stations by al-Qaeda operatives is not out of the question.
Ward pointed out that the Saudi and Jordanian monarchies speak openly of a radical “Shia crescent” across the Middle East, and that both ruling families would support a US strike against Iran. The Shia-dominated government of Iraq strikes fear in the hearts of Saudi leaders because they know it emboldens Shias in the Saudi oil-rich Eastern Province of al-Hassa. It is the emergence of Iran as a regional power that is their principal concern, not Israel.
Southern Lebanon is Shia majority, and Syria’s Bashar al-Assad is a member of the Alawite Shia sect. The alliance between Hezbollah and the Syrian regime is strong, and Iran has provided monetary and military assistance to Hezbollah for decades. Thus the current conflict in southern Lebanon carries a deep resonance across the region.
Ward also notes:
Many Sunnis view the US and Shia cooperation in Iraq as a conspiracy against them—a “Wahhabi containment policy.” The profound conviction among much of the Arab world today, including the Saudi royal family, is that the U.S. plans to do the same to Saudi Arabia that they have engineered in Iraq. Like Iraq, the theory goes, Saudi Arabia would be divided into three parts. The moderate Hashemites of Jordan would regain their historic control of the holy cities of Mecca and Medina; autonomous Saudi Shia would control the oil-laden Eastern Province; and the Wahhabis would be left baking in the sands of the Nejad Desert.
Thus the bombing of Iran could trigger wider chaos in the region, provoking not only temporary oil shortages and a global recession, but a wholesale reconfiguration of the Middle East in ways difficult to foresee.
Ward offered this helpful insider’s view of Iranian politics:
Iran’s clerical regime includes three pragmatic factional power blocs willing to engage in an opening to the USA: Mehdi Karroubi, Mostapha Moin, and Hashemi Rafsanjani, the Leader of the unelected Guardian Council. They all continue to openly criticize the President, who is increasingly viewed as a loose cannon. His Messianic claims have proved more controversial in Iran itself than in the West. Among the President’s critics, the “dealmaker” Rafsanjani may be a significant figure, for he represents the business class and the unelected clerics. These three factions, in contrast to Ahmedinejad, do not thrive on a siege mentality or on provoking a clash with the West.
When hostilities eventually ceased, negotiations between the US and Iran would necessarily ensue. Why not pursue them now and bypass the intervening catastrophe?
Ward discussed a recent Trilateral Commission Report—Is There a Plan B?—prepared for the plenary meeting of the Trilateral Commission in Tokyo, which recommended US-Iran negotiations with the goal of creating a Regional Middle East Nuclear Council, which would engage all countries with nuclear weaponry: The United States, Russia, Israel, Iran, China, India, Pakistan, Japan, the UK and France. IAEA inspections would be accelerated, with open, transparent, unrestricted access in all countries. Israel would be provided with a comprehensive security package, and Iran would be offered explicit US security guarantees. Meanwhile the Middle East would be offered a modern Marshall Plan to provide Palestine, Jordan, Tunisia, Morocco, Turkey, Egypt and Algeria access to the WTO and World Bank funding. A regional Middle East Water Council would deal with the region’s most valuable resource. Potential members would include Turkey, Syria, Lebanon, Iraq, Israel, Palestine, and Jordan. Finally, a Middle East Energy Council would deal with the region’s other valuable resources—oil and gas. Regional pipelines, oil security, technology-sharing, and reservoir depletion and monitoring would all be discussed. Such a council would include Saudia Arabia, the United Emirates, Kuwait, Bahrain, Oman, Yemen, Iraq, and Iran.
This plan has the potential to avert the looming conflict, but it is handicapped by conventional Western notions about the benefits of association with the World Bank and WTO.
Ward’s presentation was remarkable for its depiction of Bush and Ahmadinejad as two sides of the same coin. Both need external conflict to maintain domestic legitimacy, and both are right-wing hard-liners supported by religious fundamentalists; they are also unpopular at home and habitually rely on bravado to boost their image.
There are those who maintain that a US attack on Iran is unlikely because the negative consequences for America would be severe and the benefits few or nonexistent. I recently made the acquaintance of an Air Force officer with a high-level security clearance who receives daily classified briefings; while being careful not to divulge secret information, he insisted that no bombing campaign is being seriously contemplated. I can only hope he’s right.
Iraq: This Is What Collapse Looks Like
The war between Israel and Hezbollah in southern Lebanon and the growing hostilities between the US and Iran are of course unfolding in the context of the failed US occupation of Iraq. There, ethnic conflicts are deepening, a de facto civil war rages, and a partition of the country seems likely if not inevitable.
Iraqi Grand Ayatollah Ali al-Sistani was recently forced to issue a fatwa denouncing the Israeli assault on southern Lebanon. Even the US-supported Iraqi president had to make statements critical of Israel while in Washington, embarrassing his official hosts. But any other attitude would have been unacceptable to his constituents. So far, the only thing to unite Baghdad’s parliament—consisting of Sunnis, Shias, and Kurds—is condemnation of Israel and the call for a ceasefire.
Fiery nationalist Shia leader Muqtada al-Sadr, whose rising influence now rivals that of Sistani, said at a recent Friday sermon in Kufa, “I will continue defending my Shi’ite and Sunni brothers, and I tell them that if we unite, we will defeat Israel without the use of weapons.” Were Muqtada’s Mehdi Army to join with the few thousand Sunni Arab guerrillas currently bedeviling US troops, Iraq would quickly become untenable for the Americans.
Mr. Bush has repeatedly announced a “turning point” in the ongoing war—at the end of the invasion, with the capture of Saddam Hussein, with elections, with the formation of a government, and with the killing of reputed al Qaida leader al-Zarqawi. Now he has ordered an additional 5,000 troops to Baghdad to attempt to control the rapidly deteriorating situation there. This is not the sort of turning point he likes talking about.
A New Oil Regime in the Middle East?
There is considerable danger that the smoke and fire from these three geographic flashpoints—Iraq, Iran, and Lebanon—could converge in a larger regional conflagration. In light of all this potential for apocalyptic mayhem, a discussion of the oil business may seem almost frivolous. But it is important to remember that, historically, the drawing of borders in the Middle East; the establishment of British, French, and later US-backed puppet governments in these faux nations; and the rise of a radical Islamic fundamentalist movement to challenge the Western-backed regimes, have all been fueled by the wealth produced by oil, and by the need for oil on the part of importing countries.
For decades there was a petroleum status quo of sorts in the Middle East: the capacity for production exceeded demand, and OPEC worked to restrain exports in order to keep prices from collapsing; meanwhile big producers like Saudi Arabia served as the world’s petroleum bankers, maintaining the solvency of the system. On only one occasion—the embargo of 1973-74—did the swing producers withhold needed oil flows for political reasons, or cause prices to reach levels unacceptable to consumers (the other major post-1970 oil shocks, due to wars or revolutions, were beyond OPEC’s control).
Now the status quo is crumbling—not so much for political reasons (though those are certainly imaginable, given the situations outlined above), but for reasons of geology.
Questions about the real size of Kuwait’s oil reserves have emerged in the Kuwaiti National Assembly, leading the opposition party to call for production cuts. Remarkably, Kuwait appears to be groping toward implementation of the Oil Depletion Protocol, without ever having heard of it. However, from the standpoint of nations that want to keep the oil flowing so the global industrial party can continue, this is bad news.
Even worse news, potentially, comes from Saudi Arabia, where oil flows have shrunk by some 400,000 barrels per day over the past few months, despite astronomic prices. No one knows for sure what is going on. The Saudis themselves say the production cuts are due to lack of demand, but this hardly seems plausible, unless the kingdom is only able to deliver unwanted heavy, sour crude to market—but even in that case, one would expect flows to increase, with a price discount factored in for resource quality.
At the same time, the Saudis are hiring just about every spare drilling rig in the world, resulting in a dramatically falling rig count in the Gulf of Mexico—a place that would otherwise be seeing an increasing count, given the fact that Mexico’s giant Cantarell field is in now in steep decline, with dire implications for the nation’s economy.
Matthew Simmons (Twilight in the Desert) has been insisting for the past few years that Saudi production is close to peak and that Ghawar, the world’s biggest field, may be in decline. Now many others are speculating that this is the real reason for the falling production figures.
What happens next? It depends on the real condition of Ghawar. Perhaps a heroic drilling campaign could result in a temporary bloom in production, lasting perhaps three years, followed by a swift, terminal collapse. On the other hand, it is possible that the field has been so thoroughly exploited already that we are seeing the irreversible, rapid decline. At the ASPO conference a well-connected industry insider who wishes not to be directly quoted told me that his own sources inside Saudi Arabia insist that production from Ghawar is now down to less than three million barrels per day, and that the Saudis are maintaining total production at only slowly dwindling levels by producing other fields at maximum rates. This, if true, would be a bombshell: most estimates give production from Ghawar at 5.5 Mb/d.
While these events in Kuwait and Saudi Arabia are not front-page news, they are in their way every bit as significant as the ongoing violence in Iraq and Lebanon, and the ritualistic war dance of the American and Iranian leaders. The Israel and Lebanon situation seems to be about religion, terrorism, and land; the US-Iran situation seems to be about nuclear proliferation. But if one looks beneath the surface, nearly everything of significance that happens in the Middle East is at least partly about oil.
It may be pure coincidence that, just as the world’s biggest oil producers are reaching a historic turning point signaling the end of the energy regime that has held since the end of US production dominance in 1970, a war has erupted between Israel and a militant organization supported by a nation the US plans to attack anyway in order to maintain dominance of world oil supplies going forward. History is full of such coincidences. But coincidence or not, it will be difficult to keep these unfolding realities from rebounding off one another, undermining attempts at a peaceful resolution.
Some commentators speculate that we are seeing the slow-motion commencement of World War III (or IV or V, depending on who’s counting). I have no interest in fueling apocalyptic speculations. My strong wish is for a quick and peaceful resolution of the Israeli-Hezbollah-Lebanese conflict, a US stand-down from confrontation with Iran, and a speedy, voluntary US exit from Iraq.
In his talk at the ASPO conference, Terence Ward repeatedly said that America’s bombing of Iran would make the work of petroleum depletion analysts easier—presumably because skyrocketing oil prices would force everyone to acknowledge that Peak Oil is a reality. On this point I disagree. If the scenario Ward outlined comes to pass, the public’s attention will be fixated on military developments and casualties, with horrific news footage dominating nearly every moment of every television news broadcast. Oil prices will indeed soar and everyone will feel the economic pain from a crashing global economy—but few will look to geology as an explanation. Instead, they will point to the obvious proximate causes—attacks and counterattacks disrupting oil shipments, with speculators pushing prices even higher than they would otherwise go.
We have many reasons to hope that events are not spinning out of control.