The Squeeze: Oil, Money and Greed in the 21st Century. Tom Bower

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СКАЧАТЬ the commodity has been on a rollercoaster, swinging from surplus to shortage. Cheap oil has fuelled booms while high prices have plunged the world into recession. Finding a balance has been elusive. Always the target of mistrust, oil has now become a tougher, more unpredictable business than ever before.

      In 1975 Anthony Sampson, the redoubtable author of The Seven Sisters, a groundbreaking description of the relationship between the seven major oil companies and OPEC, described the Arab – Israeli war of 1973 as the ‘last battle’ to control the industry. ‘The fascination of oil history,’ he wrote, ‘lies in the ever changing form of the battle to control supply.’ Focused on the ‘collision course’ between the governments of the oil producers, the oil companies and the governments in Washington and London, Sampson, like others, did not anticipate Iraq waging war against neighbouring Iran and Kuwait, or that America would twice lead invasions of Iraq, characterised by some as ‘blood for oil’. He would have been struck, as I was, by the candour of the vice president of one of America’s biggest oil companies whom I asked in passing in 2007, ‘Was George W. Bush’s invasion of Iraq about oil?’ He replied, ‘Absolutely, yes.’ Some argue that the ideological Cold War has been replaced by ‘resource wars’. In Sampson’s era, the ‘resource war’ revolved around disputes about prices between the oil companies and OPEC.

      In the two years after the 1973 Arab – Israeli war, the OPEC leaders defied American forecasts that their cartel would collapse, because the consequence of oil prices quadrupling would be a recession in the West. But OPEC’s defiance was rewarded, and despite the nationalisation of many Western-owned oilfields, the unnerved oil companies collaborated with their expropriators. Stripped of their mystique and their arrogance, the American and British giants were transformed into paper tigers. Anxious to guarantee oil supplies and to maintain their share of markets, the companies that had discovered and developed the oilfields and refined the crude became supplicants. To many, OPEC’s ascendancy appeared to be irreversible. Only a few wise oil men mentioned the fact that cycles never changed. Permanently fixing the market was beyond any mortal, even the OPEC nations.

      By 1990, OPEC’s lurking threat had indeed diminished. The procession of technocrats following Ali al-Naimi to the second floor of OPEC’s headquarters understood that oil had become democratised: prices were set by traders in New York’s and London’s markets rather than by OPEC’s edict. Yet, even though they were no longer brokering mankind’s destiny, the ministers retained control of 40 per cent of the world’s oil supplies – sufficient to wield considerable influence.

      Since oil is the OPEC countries’ principal, and usually only, source of income, the 11 officials who attended that 153rd meeting had every incentive to seek the highest prices. Between the certainty of extracting oil from the Saudi desert for $2 a barrel or risking $100 billion to drill a speculative well four miles below the sea in the Gulf of Mexico, is the insoluble mystery of establishing the true price of a simple product. The conundrum is to identify the dividing line between reasonable businessmen and villains. Since 1990, that division has become obscured.

      In that year Daniel Yergin wrote The Prize, a magisterial description of oil’s influence on modern history. Oil, he commented, remains ‘central to … the very nature of civilisation’. But many of the political trends of the previous century which he described were changing. The major oil companies were becoming minnows, and OPEC’s power was being challenged by non-OPEC oil-producing countries, especially Russia and the states around the Caspian Sea.

      The moral keynotes were also changing. Historically associated with corruption, civic corrosion and civil war, the relationship between the governments in Washington and London and the oil companies had been a dominant topic for a century. Posing as representatives of mankind’s interests, but beyond mortals’ control, the corporations’ chairmen appeared detached from national governments. Uncertain who was using whom, many debated whether the oil companies should be supported, controlled or investigated. An important theme explored by Yergin and Sampson was the battle waged by America’s federal and state governments against J.D. Rockefeller, the creator of America’s oil industry. The epic legal contests against oil companies had usually ended in the governments’ defeat, spurring public anger about Big Oil. ‘His lack of scruple and his mendacity,’ wrote Sampson of Rockefeller, ‘provoked a continuing distrust of the oil industry.’

      Oil provokes irreconcilable emotions. Moralising sermons about oil have never stopped, but since Sampson’s and Yergin’s books, some issues have changed. Destitution in the Niger delta, the contamination of Alaska’s pristine wilderness, the destruction of Canada’s forests and spreading corruption across Africa are all blamed on oil companies. ‘African oil did not create the system or its failings,’ wrote Nicholas Shaxson in Poisoned Wells, accusing Shell, ExxonMobil and the French oil corporation Elf of destroying idyllic communities. Serious authors have claimed that the oil industry is ‘among the least stable of all business sectors’, and that supplies are ‘utterly dependent on corrupt, despotic “petrostates” with uncertain futures’. The riddle is whether, in pursuing their priority of caring for their shareholders and their customers, the oil majors should refrain from interfering in the internal affairs of Third World countries, or accept a duty to prevent the ‘institutionalised pillage’ of impoverished populations and to oversee the fate of their nations’ oil wealth.

      These issues continue to be exhaustively debated. Besides the technical and corporate histories, there are many descriptions of evil corporations exploiting the Third World and causing environmental catastrophe. In addition, a new dominant theme has arisen: ‘The End of Oil’. Predictions laced with alarming statistics foreshadow permanent shortages, blackouts and soaring prices. ‘Terminal decline’ is the favoured phrase of those speaking in apocalyptic terms about the world imminently running out of oil. One authoritative tract is Twilight in the Desert (2005) by the investment banker Matthew Simmons, who claims that Saudi Arabia’s oil production is ‘at or very near its peak sustainable volume (if it did not, in fact, peak almost 25 years ago), and is likely to go into decline in the very foreseeable future’. Even Simmons’s critics acknowledge the value of his polemic. If Saudi Arabia’s supply of oil does indeed decline, the world’s destiny is questionable. However, despite Simmons’s insistence that his doom-laden prediction is ‘not a remote fantasy’, Saudi Arabia increased its production capacity from eight million barrels a day in 2005 to 12.5 million in 2009, when the world’s daily consumption was 86 million barrels. In the aftermath of prices crashing in July 2008 and surplus oil sloshing around the world, the prophets of doom disappeared from the television studios and newspapers. Since then, the wailing about the world’s endangered oil supplies has reverted to blaming the oil companies for restricting their investment in the search to find new oil.

      Unlike oil’s first century, over the last 20 years no single nation, government, cartel or corporation has controlled its fate. Markets have determined prices and investment; but there has been a twist. Because the oil-producing countries retain up to 90 per cent of the profits, the Western oil companies have the delicate task of persuading what are usually classified as Third World countries to share their wealth and sell access to their reserves. The apparent shift of power to African, Asian and Middle Eastern governments provoked the increasingly fashionable assertion that ‘White people and their companies no longer pull the strings.’ The contention that the former imperialists have been humbled ignores the irrefutable truth that without the ‘white people’s’ technology, organisation and marketing, the oil-producing nations could not prosper. In Africa, Asia and South America, impoverished nations may be ecstatic about the sudden promise of effortless wealth; but it is only realisable with skills invented by Western companies.

      In pulling the strands of the oil industry together, this book takes no sides СКАЧАТЬ