Bush's oilmen got it all wrong in Iraq

9 August 2005Newsday.comNo oil for blood.The bumper sticker popular among left-leaning opponents of the conflict - no war for oil - has been inverted. There is no oil to be had for the shedding of American blood. Not for years anyway.Remember the bold promises?"Iraq has oil," Defense Secretary Donald Rumsfeld told Fortune magazine in 2002, discussing the potential cost of an Iraq invasion and how it would be met. "They have financial resources."Paul Wolfowitz, formerly Rumsfeld's deputy, was bolder: "The oil revenues of that country could bring in between $50 [billion] and $100 billion over the course of the next two or three years," he told Congress as the war began. "We're dealing with a country that can really finance its own reconstruction."Iraq exported 1.6 million barrels per day in July, according to the oil ministry, at least half a million barrels a day less than in the waning months of Saddam Hussein's regime. Hours-long lines at gas stations are a constant of daily life, and the country must import gasoline.How did an administration overflowing with oilmen get it all so wrong?The story line is tiresome. It parallels the warnings about weapons of mass destruction. It tracks with the delusional prediction about being greeted as liberators, and the fantasy about how only a few "dead-enders" continued to fight after our troops took Baghdad.The president's men saw what they wished to see - the 115 billion barrels of oil reserves beneath the desert. They were blind to what was really there: an oil industry decimated by more than a decade of economic sanctions, with technological decay and even geological deterioration of the fields already gnawing at it.The rash predictions about Iraqi oil paying for the American conquest of Iraq were always suspect, part of the marketing campaign that sold the war. "The statement in and of itself always struck me as part of the spin that this was going to be a clean, simple, fairly cost-free operation," a veteran adviser to Western governments in Baghdad told me in an interview.Just as UN weapons inspectors, once allowed back into Iraq, correctly surmised that there were no weapons of mass destruction, so, too, did oil industry inspectors for the United Nations accurately assess the dire condition of Iraq's oil industry. In 1998 a UN report found it in a lamentable state. The conclusion was confirmed in 2000 and again in 2001. "Basically being held together with chewing gum," is how the Western expert described it. "At the time this was dismissed by the United States as just another example of how the UN had been taken in by the Iraqis."The U.S. Energy Information Administration concedes the point. The report for the United Nations "now appears to have been largely accurate," the agency says in its latest analysis of Iraq's oil situation.Now Iraq's oil industry contends with sabotage and violence. No major oil company is likely to put its employees, or its money, at risk. The Kurds, if they succeed in forming an autonomous state in the north, are likely to lay claim to Kirkuk, a locale responsible for as much as a quarter of the oil production.There has never been credibility to the crude argument that this war was about crude. If it had been, wouldn't the oilmen who waged it have conducted it differently? The fields would have been secured, not left as targets. The careerists who ran the industry under the old regime would not have been banished.We are told now that by Aug. 15 another bright marker toward Iraq's golden future will be reached. The writing of a constitution is to be finished. It is a deadline the Bush administration is determined to have the Iraqis meet. For Iraqi political progress is a prerequisite for the president's underlying political goal: an American troop withdrawal to begin before the 2006 congressional elections.But if Iraq cannot produce and sell its oil, it cannot rebuild its roads or hospitals. It cannot feed itself. It is a candidate not for becoming a fabulously wealthy Middle East player, but for becoming a failed state.