Article: The Guerilla War for Iraq’s Oil

A war is raging in Iraq that will determine the outcome of the present occupation as well as the shape of future conflicts. It is the war for control of Iraqi oil.

Currently, America is losing the conflict in rather stunning fashion with little hope of reversing the situation in the near future. This week the Iraqi Oil Ministry announced that oil production "has reached a post-war low" and that the "exports of crude, which had run at an average of about 1.6 million barrels per day since the end of the 2003 war, dropped to 1.2 mbpd in November and 1.1 mbpd in December." (Al Jazeera) All the indicators point to reduced production due to the escalating violence.

At times, the export of oil has been completely cut off in both the northern and southern regions making it impossible to capitalize off Iraq's prodigious resources. The Iraqi resistance has grown increasingly skillful in sabotaging pipelines and facilities despite the massive security operations devoted to their protection.

This is truly the face of 21st century warfare; disparate cells of armed guerillas disrupting critical energy supplies that sustain the global economy.

Currently, the resource war is concealed behind a propaganda smokescreen created by the establishment media. Their task is to characterize the conflict as a war on terror and to limit their coverage to the random incidents of violence by fanatical jihadis killing. It's rare when the media reports on the real guerilla war that has subsumed Iraq and which will soon be reflected in a global economic downturn.

There's simply no way that the administration can prevail in its original intentions of controlling Iraq's oil reserves if a small army of guerillas focus on disrupting oil production. Millions of dollars of infrastructure can be destroyed in a flash by one determined fighter with a bomb or a Kalashnikov.

The resistance's success is quantifiable in terms of the reduction in oil exports. In 1990, Saddam was exporting 3.5 million barrels per day. Since then, there has been gradual decline from sanctions and neglect. Following the invasion of 2003, the oil sector has taken a nosedive directly attributable to the blowing up of pipelines. Production is now at an all time low, less than half of what it was just prior to the invasion. The development of oil fields and the transport of petroleum are proving to be irreconcilable with the brutal exigencies of occupation.

Again, on the one issue that matters the most to the Washington mandarins, the battle is being lost, and it is being lost quite convincingly.

"The general integrity of Iraqi infrastructure appears to us to be heading backwards rather than forwards," London-based Barclay's Capital said in a report issued last month. (Jim Crane Associated Press)

Gone are the optimistic predictions, like those of Paul Wolfowitz and Dick Cheney, who expected that Iraq would pay for its own reconstruction with oil revenues. Instead, what we see is the chilling rictus of new type of warfare that threatens to sweep across the region swallowing up vital resources in columns of black smoke.

The attacks on facilities have discouraged foreign investors from committing to long-term investment or development. Many of the major players remain skeptical that the US-led occupation will be able to stabilize the situation in the near future. Industry analysts expect little change in output in 2006.

Additionally, the IMF has demanded that the Oil Ministry remove price-supports for the highly-subsidized Iraqi domestic supplies. This has only increased the public's outrage with the ongoing occupation. The IMF authorized a loan of $685 million to Iraq in December with the predictable "vice-like" provisions that require Iraq to follow its structural adjustment programs. In effect, these provisions put Iraqi resources under the direct control of transnational corporations who can decide the terms under which those resources are sold.

The growing opposition to the occupation and the increasingly adept Iraqi resistance provide the foundation for a long and costly conflict. Iraq is the first clear example of asymmetrical warfare in the new century; small groups of rebels who target crucial energy supplies crippling industry and savaging the global economy.

As America continues to tighten its grip on the world's dwindling hydrocarbon resources, we can expect that the guerilla war we see in Iraq will naturally spread throughout the region making oil development a "zero sum game".

Eventually, the successes of the resistance will be adopted by other disparate groups who have no chance of beating the United States in open battle, but hope to bring the empire to its knees by making the costs too great to sustain.