So we all know it’s about oil, but what is the underlying motivation in dollar and cent terms.
Currently, as a result of UN sanctions, Iraq is the world’s 9th largest producer of oil. It sits on known reserves slightly less than that of Saudi Arabia and is estimated to have twice Saudi Arabia’s reserves as yet untapped.
The US predicts that a successful invasion of Iraq will allow it to take over oil production in Iraq’s oil fields. This will have a dual benefit. The first being the insurping of French oil giant ELF and installing of US and British Oil interests. But this is small fry compared to the benefits expected from the collapse in the oil price. The US estimates that a fall in oil prices from 25 USD/Barrell of Brent crude to 19 USD will raise US GDP by 75 Billion dollars a year.To put that in perspective that’s a gain of the entire New Zealand or Phillipines economy per year in extra income.
The more likely outcome is a price well below that of 19 USD per barrell as running Iraq’s current oil fields at full capacity would place them 4th in world production. This would give the US cartel breaking capacity and control over the world’s oil production and price. The price of oil under such a scenario could fall as low as 9 USD per barrell or lower. The wind fall profits for the US economy are stupefying at this price as was the case in the late 90’s.
This is the critical issue here. Support from Middle Eastern Oil producing allies will never be forthcoming under this scenario, they stand to lose all. Most of these States were under huge pressure when the price of oil was low in the late 90’s just to stay in power. It is a brilliant strategic move on the part of the US administration and that is why it will go ahead no matter what people feel about it.
In fact, it really is a rounding out of what Bush senior started. He at that time was concerned about the the invasion of Kuwait and Saddams desire to take over Kuwaiti oil fields which were producing oil at such a rate of knotts the price of oil was falling to historically low levels. Saddam’s concern then and it was a legitimate one (as legitimate as the US’s current concern) was that he was losing between 6 and 7 billion dollars a year in the State coffers as a result of the crappy oil price.
If you think it’s about weapons of mass destruction then there’s this bridge I’ve got for sale in Sydney Harbour. I think you’ll really like it.