YESTERDAY:
How America’s unappeasable thirst for cheap oil led to foreign-policy bungling in the Persian Gulf?!
Once upon a time, United States of America was the world’s number one oil importer with Iran as his foremost ally in Middle East. To Americans, The Shah was the guardians of the Gulf. It was with United States of America’s approval that Shah raised the price of the oil and that kept America’s on top of richest countries in the world.
“I like him, I like him and I like the country. And some of those other bastards out there I don’t like, right?”
Richard Nixon – 1971
Him in “I like him” was Shah: The person who could run the country better, but instead he fell into the wrong trap.
Bastards: please you take the hint.
If you would remember the recession of 1969-1970, you would know that it lasted for almost 11 months. The beginning of it was in Dec.1969 following an economic slump which began in 1968 which became serious by end of 1969. One of the plans to rescue from this recession was having access on Middle East petrol!
It's always been about oil when it comes to the Middle East!
Various exploratory ventures were launched in Persia (present: Iran) at the turn of the 20th century. The first concession was formed between Baron Julius de Reuter, founder of the Reuters news agency, and the Persians in 1872 but it was later dissolved due to opposition within Persia and Russia.
“Now is time to cash in credit with Iranians.”
Henry Kissinger – 1972
With Iran’s annexation of Abu Musa, Greater Tunb and Lesser Tunb, Mohammad Reza Shah was confirmed in his self-designated as Guardian of the Gulf.
“Iran will get all available sophisticated weapons short of the atomic bombs”
Mohammad Reza Shah – 1972
“We were going to make the Shah the Guardian of the Gulf. Well, if we were going to make the Shah the Guardian of the Gulf, we’ve got to give him what he needs— which comes down to giving him what he wants.”
James Schlesinger – 1972
But Iran’s Arab’s neighbors were not happy with that. In the summer of 1972, a few weeks after Nixon’s meeting with the Shah in Tehran, the Saudis made it clear they wanted to renegotiate the terms of the oil production monopoly enjoyed by Aramco, as an alternative to nationalizing its operations outright. Late January 1973, United Sates was running low on sullies of natural gas. The shortage forced the Nixon administration to abandon the import quotas of the Eisenhower era in April. The oil shortage and Saudi’s success in taking over the oil companies convinced Shah to try similar tactic and he was successful. Iran took the control of Iran’s oil industry and Nixon agreed to remove the restrictions on conventional weapons sales on Tehran. Shah was seeing the plan as a great opportunity for his growth but to them it was a plan that had the potential to ignite a religious-based war pitting Shi’a Iran against its Sunni Arab neighbors and potentially draw in the Soviet Union but;
September 1, 1973: Colonel Qaddafi announced the expropriation of 51 percent of the assets of foreign oil companies operating in his country.
October 6, 1973 the combined armies of Egypt and Syria attacked Israel.
October 10, early on the morning Schlesinger phoned Kissinger to inform him that the Soviets were resupplying Arab forces and that King Faisal had committed Saudi troops.
October 13, the Israelis were bogged down, having lost a quarter of their air force.
October 19 Colonel Qaddafi imposed an oil embargo against the United States and raised the price of oil.
October 17, Arab oil ministers meeting in Kuwait agreed to monthly 5 percent cuts in production until Israel evacuated the territories it had seized in 1967.
October 21, Kuwait, Qatar, Bahrain, and Dubai announced that they were joining Saudi Arabia, Libya, Algeria, and Abu Dhabi in halting oil shipments to the United States.
November 25, President Nixon went on national television to announce strict limits on weekend sales of gasoline, a blackout on all unnecessary outdoor lighting.
Watergate scandal,
Nixon’s resignation,
Shah’s sickness,
U.S.‘s withdrawal from Vietnam,
Nation’s disappointment,
Start of revolution.
And plan got changed.
American started to increase their dependency on Saudi Arabia
Most of the book consists of historical descriptive narrative of US policy decision-making and diplomatic relations with Iranian and Saudi counterparts addressing the high oil prices and their impact on US and Western European economies.
TODAY:
China is the world’s largest net importer of crude oil, and in recent years, China’s crude oil imports have increasingly come from countries outside the Organization of the Petroleum Exporting Countries (OPEC).
Organization of the Petroleum Exporting Countries (OPEC) was founded in Baghdad, Iraq, with the signing of an agreement in September 1960 by five countries namely Islamic Republic of Iran, Iraq, Kuwait, Saudi Arabia and Venezuela. They were to become the Founder Members of the Organization.
These countries were later joined by Qatar (1961), Indonesia (1962), Libya (1962), United Arab Emirates (1967), Algeria (1969), Nigeria (1971), Ecuador (1973), Gabon (1975) and Angola (2007).
As the EIA reports in recent blog post, , while OPEC countries still made up most (57%) of China’s 7.6 million barrels per day (b/d) of crude oil imports in 2016, crude oil from non-OPEC countries made up 65% of the growth in China’s imports between 2012 and 2016. Leading non-OPEC suppliers included Russia (14% of total imports), Oman (9%), and Brazil (5%).
“The Oil Kings” is a captivating and interesting read worthy of confidential explosive political and economic informations.