It's been a while since I last posted anything, but I've decided it's better to wait for major developments than to post stories about details which aren't changing much day to day and therefore are not very useful for the purpose of the weblog.

First, the U.S. has announced that Iraq will not honor OPEC production limits:

The U.S. adviser to Iraq's Ministry of Oil said it may be in that country's best interest to disregard quotas set by OPEC and export as much oil as it can, The Washington Post reported in its Saturday edition. Phillip Carroll, former head of Royal Dutch Shell's U.S. operations, also told the Post in an interview that oil drilling and production contracts signed by the ousted Iraqi government with companies in Russia, China and France were potentially void or subject to renegotiation.

With world energy markets anxious for any indication of the level of future Iraqi production, Carroll noted the country had historically been an "irregular" OPEC participant. "They have from time to time, because of compelling national interest, elected to opt out of the quota system and pursue their own path. ... They may elect to do the same thing. To me, it's a very important national question," Carroll was quoted as saying.

The Post also said Iraqi Oil Ministry officials were actively considering pulling the country out of the Organization of Petroleum Exporting Countries in order to export as much crude as possible once oil fields had returned to full capacity. Most analysts believe it could take more than a year for the country to reach the level of production needed to meet current OPEC export quotas, the paper reported.

The Post said the government of Iraqi President Saddam Hussein, toppled by U.S.-led forces, had an official policy of steering contracts for drilling services, joint production and machinery to companies in France, Russia and China, whose governments tended to be supportive of Iraq in the U.N. Security Council. Carroll did not identify any specific contracts that could be in peril, but asserted the old system of preferential treatment expired with the government, the Post said. "There will have to be an evaluation by the ministry of those contracts and a determination of whether they were made in the best interests of the Iraqi people," Carroll said. "Certainly, where contracts are, shall we say, excessively beneficial to one party, and that party is not the Iraqi people, and there is a legal basis for not going forward, then I would expect that the ministry would want to have another look," he said. ...

He rejected suggestions the United States was using its influence in Iraq to try to break OPEC. "In the final analysis, Iraq's role in OPEC or in any international organization is something that has to be left to an Iraqi government," Carroll said. But he said Iraqis were right to consider whether they wanted to remain in the oil cartel.

Reuters, "U.S. Advisor Says Iraq May Ignore OPEC Quotas," May 17, 2003

Carroll, former oil company executive, suggests that whether or not to opt out of OPEC is a "very important national question." One must wonder, then, why the U.S. is making it. It is quite obvious that it is not in Iraq's best interest to opt out of OPEC. OPEC is an oil cartel, and there is a reason why business cartels are outlawed in the United States under the Sherman Act: the members acquire too much power vis-a-vis consumers. The U.S. being an importer of oil (i.e., a consumer) is hoping to force Iraq's withdrawal (through force of arms) in order to benefit itself (rather, American elites) at the expense of Iraq. This is plain enough.

Additionally, besides opting out of OPEC, the U.S. is working to void contracts that the Hussein government made with France, Russia, and China in order to make clear the path for American elites for whom the war was fought. "Preferential contracts" means contracts that are not preferential to American elites. Iraq under Hussein, of course, contracted with France, Russia, and China and not the United States because the U.S. has sought all along, in accordance with a 1947 policy document the "removal or modification of existent barriers to the expansion of American foreign oil operations." Hussein being such a barrier (he nationalized Iraq's oil in 1972), we can understand his reluctance to contract with the U.S. These contracts were a motivation for opposition to the war from France, Russia, and China, but they are not the sole motivation. If only cancellation of contracts was at issue, their opposition would not have been so fierce. It was, in addition to simple cancellation, the additional fact that America now would control Iraq's oil instead of an independent party. With this control, America now has a stranglehold on the economies of all three nations (France and China are dependent on Iraq's oil, and Russia's economy is dependent upon its own oil production whose value can be tinkered with by the Americans in Iraq).

What we have here is a pretty simple racket that could have been achieved by even the most inept organized crime families had they been outfitted with the proper bombs and will to kill. The America government has invaded a country, abolished its former government (however rotten it might have been), and established a government (hand-selected!) that will, in exchange for placing it in power, sell Iraq's oil to American elites at a cost set by the American elite far below its actual value to the Iraqi people. (The Americans will of course sell it back to them for a modest profit). It's nothing more than armed robbery, of course, but this is what governments are set up to do.

It should be little wonder, then, that we have this:

Thousands of Shiite Muslims protested here today, demanding that the United States turn over power to an Iraqi government and withdraw its troops from the country. ... The Shiite protest was among the strongest expressions yet of the growing dissatisfaction among Iraqis about the pace of change. Some 10,000 demonstrators marched from a Sunni Muslim mosque in the north of the capital to a spot near a Shiite shrine in the Kadhimiya quarter, carrying placards that read "No, no, no U.S.A.," Reuters reported. They chanted, "We will not sell this country."

New York Times, "Thousands of Iraqis Rally to Protest U.S. Moves in Baghdad" by Neela Banerjee, May 19, 2003