The huge risks of Trump’s call to ‘take’ Iraqi oil

Sunday 26/02/2017
An Iraqi worker operates valves at the Rumaila oil refinery, near the city of Basra. (AP)

Beirut - Iraq is the second largest oil producer in the Organisation of the Petroleum Exporting Countries (OPEC). Iraqi crude oil reserves stand at 143 billion barrels, representing about 9% of global reserves and ranking fifth globally.

Iraqi crude oil production has averaged more than 3 million bar­rels per day (bpd) in the past two years. Approximately 3.6 mil­lion-3.8 million bpd are produced from the southern fields and about 450,000 bpd are produced in the north by the Kurdistan Regional Government (KRG) and the North Oil Company, which is owned and operated by the federal govern­ment.

The Islamic State (ISIS) ran­sacked and destroyed the 310,000 bpd Baiji refinery, Iraq’s largest and most modern. ISIS burned a large number of al-Qayara wells, causing an environmental crisis in north-central Iraq.

Since the 2003 invasion, Iraq’s oil industry has suffered scores of attacks on facilities, corruption and smuggling of crude oil and petroleum products. There have been chronic problems between the KRG and the federal govern­ment. The KRG undertook an inde­pendent oil policy from the federal government, leading Baghdad to cease paying the KRG its share of the national oil wealth.

Despite international sanctions imposed by the United Nations in the 1990s and the repeated attacks since 2003, Iraq’s oil production capacity increased from about 2 million bpd to more than 3.5 mil­lion bpd.

US President Donald Trump ad­vocated during the election cam­paign that the United States should take Iraqi oil as a compensation for the approximately $2 trillion cost of the 2003 invasion of the coun­try. The day after his inauguration Trump spoke at CIA headquarters in Langley and reiterated his call “to take” Iraqi oil to reimburse the United States for the invasion and to stop ISIS from benefitting from Iraqi oil funds

“The old expression, ‘To the victor belong the spoils’ — you re­member. I always used to say, keep the oil. I wasn’t a fan of (the Iraq war). I didn’t want to go into Iraq but I will tell you, when we were in, we got out wrong,” Trump said.

“And I always said, in addition to that, keep the oil.

“Now, I said it for economic rea­sons but, if you think about it, if we kept the oil you probably wouldn’t have ISIS because that’s where they made their money in the first place. So, we should have kept the oil. But, OK, maybe we’ll have an­other chance, but, the fact is, we should have kept the oil.”

These are uncertain times in in­ternational politics. Trump’s ad­ministration has daily surprises, domestically and internationally, starting with building the wall on the border with Mexico and inflam­ing the Islamophobia campaign with regulations for the entry of citizens from seven Muslim-ma­jority countries and blocking the entry of Syrian refugees.

Trump has ignored the fact that the UN Charter and other interna­tional documents have abolished since 1945 the principle of “to the victors go the spoils”.

The US president also ignored the fact that the United States was not asked by the Iraqi authorities to send troops to their country, nor did the United States obtain UN Security Council approval for the invasion. The US or UN teams did not find weapons of mass destruc­tion, the casus belli.

Trump also got his facts wrong about ISIS financing. ISIS was be­ing financed while in Syria, more than a year before it occupied Mo­sul in June 2014. ISIS did not oc­cupy the southern Iraqi oil fields or fields controlled by the KRG. Its ex­ploitation of Iraqi oil was minimal. It is not the original or main source of its financing.

If Trump plans to go ahead “to try another chance to take Iraqi oil”, he will ignite a new war in Iraq. A US annexation of Iraq or its oil fields would ignite armed con­flict in the country, lead to the rise of new militias and the destruction of facilities in the fields.

An overt call to take the Iraqi oil fields would cause a national rally in Iraq, despite the many confes­sional splits.