Was the Iraq War About Grabbing Oil … Or Keeping It Off the Market?

George Washington's picture

U.S. Secretary of Defense Chuck Hagel, 4-Star General (and CENTCOM commander with responsibility for Iraq) John Abizaid, Fed boss Alan Greenspan, President George W. Bush, Senator John McCain, Sarah Palin, Bush speechwriter David Frum, key war architect John Bolton,  and a high-level National Security Council officer all say that the Iraq war was about oil.

Documents from Britain show the same thing.

But apologists for the Iraq war said this can't be true, because American companies didn't really end up with that much Iraqi oil.

BBC and Guardian investigative reporter Greg Palast - a New York Times bestselling author - thinks he knows why.  Palast is famous for obtaining original source documents from whistleblowers which tell the real story.

Palast argues today that source documents he obtained through cloak-and-dagger methods prove that the war was actually focused on keeping Saddam's oil off of the market ... so as to keep oil prices high:

[I obtained] a 323-page, three-volume programme for Iraq's oil crafted by George Bush's State Department and petroleum insiders meeting secretly in Houston, Texas.


I cracked open the pile of paper – and I was blown away.

Like most lefty journalists, I assumed that George Bush and Tony Blair invaded Iraq to buy up its oil fields, cheap and at gun-point, and cart off the oil. We thought we knew the neo-cons true casus belli: Blood for oil.


But the truth in the Options for Iraqi Oil Industry was worse than "Blood for Oil". Much, much worse.


The key was in the flow chart on page 15, Iraq Oil Regime Timeline & Scenario Analysis:


"...A single state-owned company ...enhances a government's relationship with OPEC."




I'd already had in my hands a 101-page document, another State Department secret scheme, first uncovered by Wall Street Journal reporter Neil King, that called for the privatisation, the complete sell-off of every single government-owned asset and industry. And in case anyone missed the point, the sales would include every derrick, pipe and barrel of oil, or, as the document put it, "especially the oil".


That plan was created by a gaggle of corporate lobbyists and neo-cons working for the Heritage Foundation. In 2004, the plan's authenticity was confirmed by Washington power player Grover Norquist.




The neo-con idea was to break up and sell off Iraq's oil fields, ramp up production, flood the world oil market – and thereby smash OPEC and with it, the political dominance of Saudi Arabia.


General Jay Garner also confirmed the plan to grab the oil. Indeed, Secretary of Defense Donald Rumsfeld fired Garner, when the General, who had lived in Iraq, complained the neo-con grab would set off a civil war. It did. Nevertheless, Rumsfeld replaced Garner with a new American viceroy, Paul Bremer, a partner in Henry Kissinger's firm, to complete the corporate takeover of Iraq's assets – "especially the oil".


But that was not to be. While Bremer oversaw the wall-to-wall transfer of Iraqi industries to foreign corporations, he was stopped cold at the edge of the oil fields.


How? I knew there was only one man who could swat away the entire neo-con army: James Baker, former Secretary of State, Bush family consiglieri and most important, counsel to Exxon-Mobil Corporation and the House of Saud.

(One unwitting source was industry oil-trading maven Edward Morse of Lehman/Credit Suisse, who threatened to sue Harper's Magazine for my quoting him. Morse denied I ever spoke with him. But when I played the tape from my hidden recorder, his memory cleared and he scampered away.)


There was no way in hell that Baker's clients, from Exxon to Abdullah, were going to let a gaggle of neo-con freaks smash up Iraq's oil industry, break OPEC production quotas, flood the market with six million bbd of Iraqi oil and thereby knock the price of oil back down to $13 a barrel where it was in 1998.


Big Oil could not allow Iraq's oil fields to be privatised and taken from state control. That would make it impossible to keep Iraq within OPEC (an avowed goal of the neo-cons) as the state could no longer limit production in accordance with the cartel's quota system. The US oil industry was using its full political mojo to prevent their being handed ownership of Iraq's oil fields.


That's right: The oil companies didn't want to own the oil fields – and they sure as hell didn't want the oil. Just the opposite. They wanted to make sure there would be a limit on the amount of oil that would come out of Iraq.


Saddam wasn't trying to stop the flow of oil – he was trying to sell more. The price of oil had been boosted 300 percent by sanctions and an embargo cutting Iraq's sales to two million barrels a day from four. With Saddam gone, the only way to keep the damn oil in the ground was to leave it locked up inside the busted state oil company which would remain under OPEC (i.e. Saudi) quotas.


The James Baker Institute quickly and secretly started in on drafting the 323-page plan for the State Department. With authority granted from the top (i.e. Dick Cheney), ex-Shell Oil USA CEO Phil Carroll was rushed to Baghdad in May 2003 to take charge of Iraq's oil. He told Bremer, "There will be no privatisation of oil – END OF STATEMENT."




Some oil could be released, mainly to China, through limited, but lucrative, "production sharing agreements".


And that's how George Bush won the war in Iraq. The invasion was not about "blood for oil", but something far more sinister: blood for no oil. War to keep supply tight and send prices skyward.


Oil men, whether James Baker or George Bush or Dick Cheney, are not in the business of producing oil. They are in the business of producing profits.


And they've succeeded. Iraq, capable of producing six to 12 million barrels of oil a day, still exports well under its old OPEC quota of three million barrels.


The result: As we mark the tenth anniversary of the invasion this month, we also mark the fifth year of crude at $100 a barrel.

Palast concludes that Cheney - a neo-con, but also a long-time oil man - sided with the oil companies, and decided not to divvy up the Iraqi oil spoils, but instead to make sure that the oil supply remained relatively scarce.

Indeed, top oil economists have said that the Iraq war substantially raised the price of oil ... making a lot of people rich.

As bizarre as the oil-restriction theory may sound, the big U.S. oil companies have been doing that kind of stuff for years.

Note: We've heard such speculation for the last 10 years.  But Palast - one of the best investigative journalists in the last century - has such a spectacular record for breaking stories based upon source documents he obtains from whistleblowers that we think this is newsworthy.

There may - of course - have been additional motives for the war. And see this.

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Species8472's picture

The war was about securing oil to replace Irans oil, we can't invade Iran without replacing their oil on the market.

mayhem_korner's picture




A little lesson industrial organization...the only reason to hoard/accumulate anything is to withhold it from others.  Sometimes the "others" are competing suppliers, and sometimes the "others" are buyers.

I am on to you's picture

Just like the good old, war on drugs,the 800 pound Godzilla.

Drik  Chivas Legal or Glenfidus,but hell if you smoke a joint.

This world is sleeping soundly and safe!

You keep to amaze,GW!Thanks!

KashNCarry's picture

We've known for years that the war in Iraq was about CONTROL of oil.  The idea was to keep it in the ground, remove Saddam Hussein and his plans to sell Iraqi oil for petro Euro's instead of petro dollars, and to continue waging war with Syria, Lebanon, and Iran for control of the middle east.  Now the plan is to destroy Syria and divide it into more managable sub states before moving on to Iran.

Flakmeister's picture

GW this doesn;t pass any form of sniff test...

For example, why is Iraqi production significantly up since Saddam's day?

Broken_Trades's picture

GW may remember me calling BS on some of his sensational GOM Oil Spill Stories back in the day.


Heres a link for Iraq oil production.  Took about 6 seconds to fact check the info in this story.



Any drop in production that was going to the United States is now going to China, India etc...  I dont see the benefit to the united states by invading Iraq for the oil - They certainly arent getting much of it. To me it seems like a "Control of" resource situation where they can now ensure it will be sold in USD vs EUROs or other.



steveo77's picture

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Poor Grogman's picture

This is so incomprehensible to most, simply because most people cannot conceive of the breath or depth of the global central planning and deception that is taking place.

The premise of the article makes sense on many levels, it also fits with the elite preoccupation promoting AGW. The elite do not give a damn how much oil costs them personally. However they do care about future profits and continuation of "the system" that enables them to profit from simply being in control...

The explanation given by this article, would ensure elite control of " the system" further into the future than would otherwise be possible under an unfettered free market.

Means and motive...

Dieselclam's picture

This is the key as to why gold hasn't gone to $40,000/oz. See FOFOA and ANOTHER's "thoughts" for details.

Poor Grogman's picture

When FOFOA loses the verbose secret squirrel attitude and just says what she actually means, I might bother...

Go Tribe's picture

Bush invaded Iraq looking for WMDs. His closest advisors insisted on it, but knowing full well there were none. The last thing any oil-industry cabal would want to do is let the President in on a scheme like it had going.  Ditto for obama, he is being played entirely. And we are totally ass-fucked. Don't let your babies grow up to be soldiers.



incognito's picture

The Iraq war was about replacing a stable, albeit evil and murdurous, dictator with Muslim extremists. The plan was repeated across North Africa.



blazinrabbit's picture


I think you’re giving way too much credit for the brilliance of the aforementioned conspirators. If they (the bad guys) were half as smart as you seem to imply then the banks and the military industrial complex would have taken over the land we love and we would all be in debt to our eyeballs. Thank God for the rational people on CNBC, CBS, CNN, and the CIA.


XRAYD's picture

WMD WMD WMD 9/11 9/11 9/11 Mushroom cloud!

MrBoompi's picture

The US wants control of the oil. They especially don't want the oil traded for gold or any other currency besides the USD. No need to pump into a glut when you can wait for $500/bbl.

ekm's picture

Possible. Conjecture worth following.

However, any plan, is always time limited.

Fred Hayek's picture

As others have noted, it wasn't about the oil. It was about the dollar. Saddam Hussein was talking about accepting the euro as payment for oil, wasn't he?

It's too bad that the lefties who protested the war got it so wrong. It wasn't blood for oil. It was blood, as usual, for the dollar.

Meremortal's picture

No and no.

There were less politically dangerous and easier ways to do those things if that was the desired result.

THE DORK OF CORK's picture

The North Sea needs high prices to sustain the now rapidly declining production.


At £50 dollar oil most of those fields are not worth pumping.

unirealist's picture

There is an apocryphal story that in 1973 with the oil "crisis" caused by the OPEC embargo, the Saudis offered to ramp up their oil production and bust the oil prices back down.

David Rockefeller and Henry Kissinger rejected his offer.

You see, the oil embargo was an enormous gift to US banks like the Rockefellers' Chase-Manhattan.  All that new Arab income, hundreds of billions in new oil revenues, had to go somewhere, and it went into US banks.

The banks in turn loaned it out to South American gov'ts for idiotic and expensive capital improvement projects, airports in the jungle and such.

Ultimately most of those loans went bad and the banks that made them became insolvent with their losses.  No worry.  Under Fed chief Volker interest rates were raised and the US taxpayer wound up recapitalizing the banks.

The oil shock may have been horrible for the US taxpayer and US economy, but it was a windfall for the big US banks, which made billions from the new Arab deposits of oil profits.

Nixon's administration, with the help of our friends the Saudis, could have broken the back of the embargo.  It didn't happen for the simple reason that the banksters LOVED the embargo and didn't give a damn about the taxpayer and the economy.

What's new.  

johnQpublic's picture

when i left for the first gulf war, gas cost 73.9 per gallon.

when i came back it was 1.35 per gallon

i said then that we went to war to raise the price of oil.

it was true then and its true now.

OccupyTVstations's picture

One might think the oil embargo was a nice cover for Nixon's de-coupling of the dollar to gold. They told us the subsequent rise in price was "due to the evil OPEC" when actually it was massive deflation as the FED was now able to print dollars freely.

Goldilocks's picture

Richard Nixon - "I'm not a crook" [HIGHER QUALITY - FULL VERSION]
http://www.youtube.com/watch?v=sh163n1lJ4M (0:37)

ebworthen's picture

Considering the amount of money we spent, and the number of lives lost, we should have a direct line from Iraqi oil fields to our refineries.

I mean, if we are going to act like Rome we may as well get some of the benefits, no?

But instead we give everything back, and shut down our refineries.

The goal can't be freedom and lower gas prices.

little buddy buys the dips's picture

"we" don't get anything but assfucked.

OpenThePodBayDoorHAL's picture

The real booty and plunder from these wars is not oil (cheap or otherwise), it's dollar flow from taxpayers to Boeing Raytheon Halliburton, but also Federal Express (no-bid contracts to ship pallettes of bottled water from Seattle to Baghdad), KFC (on every major base) etc etc. I mean check out the largest clients of most of the S&P 500: the US Gov't. Microsoft's biggest customer by far: The US Army.

America = War = America

What do you think the "pivot to Asia" is all about? They've shit the bed across the MidEast, no more warmaking plunder available, time to move to greener pastures. And how about "al-Qaeda in North Africa"? AfriCom is just gearing up.

History will not be kind. Empire of Death.

Radical Marijuana's picture


Empires Then And Now

By Paul Craig Roberts, April 3, 2012.

Great empires, such as the Roman and British, were extractive. The empires succeeded because the value of the resources and wealth extracted from conquered lands exceeded the value of conquest and governance. ... America’s wars are very expensive. George W. Bush and Barack Obama have doubled the national debt, and the American people have no benefits from it. No riches, no bread and circuses flow to Americans from Washington’s wars. So what is it all about?

The answer is that Washington’s empire extracts resources from the American people for the benefit of the few powerful interest groups that rule America. The military-security complex, Wall Street, agribusiness and the Israel lobby use the government to extract resources from Americans to serve their profits and power. The U.S. Constitution has been extracted in the interests of the security state, and Americans’ incomes have been redirected to the pockets of the 1 percent. That is how the American empire functions. ... In this new empire, success at war no longer matters. The extraction takes place by being at war. Huge sums of American taxpayers’ money have flowed into the American armaments industries and huge amounts of power into the Department of Homeland Security. The American empire works by stripping Americans of wealth and liberty.

smartstrike's picture

Best post I read on ZH... and with the help of Wall Street traders, Iran, and Chavez they ran up the price of oil from about $10 to over $140. The oil mafia in Texas got so rich on arms and petrol that they managed to buy the whole political class in DC.

Fix It Again Timmy's picture

Throw away the very sane constitutional article that only Congress can declare war and only in the event of an imminent attack and you get this disgusting bullshit dreamt up by pencil-dick psychopaths who think of themselves as swinging-dicks lords of the world...

thisandthat's picture

Meanwhile, gas is now way more expensive than it ever was, even during 2008 crude peak...

Radical Marijuana's picture

It is NEVER so much about the natural resources, such as oil, as much as it is ALWAYS about the monetary system that is able to control those resources. "Our" weapons do not defend "freedom and democracy!" Those weapons and wars defend and advance the banksters' frauds. Being able to legally make money out of nothing, as debts, while also being able to force everyone to accept that financial fraud, is of almost infinite value, since money controls the natural resources, and practically everything else! The war in Iraq basically fit into the overall series of events described as the operations of the economic hitmen, by John Perkins.

I will repeat the most important quote, which is what everyone should keep in mind when attempting to understand all the false flag attacks and other lies used to start genocidal wars, along with preparing to impose martial law, as laid out by Georgetown professor and historian, Carroll Quigley, who commented on the creation of the central banks in his 1975 book, Tragedy And Hope, as follows:

"The powers of financial capitalism had (a) far reaching (plan), nothing less than to create a world system of financial control in private hands able to dominate the political system of each country and the economy of the world as a whole. This system was to be controlled in a feudalist fashion by the central banks of the world acting in concert, by secret agreements arrived at in frequent meetings and conferences. The apex of the system was to be the Bank For International Settlements in Basel, Switzerland, a private bank owned and controlled by the world's central banks which were themselves private corporations. Each central bank ... sought to dominate its government by its ability to control treasury loans, to manipulate foreign exchanges, to influence the level of economic activity in the Country, and to influence cooperative politicians by subsequent economic rewards in the business world."

I would add that it is misleading to call the established system "financial capitalism!" The closest label for that system is fascist plutocracy. However, that label too is misleading, since the greatest form of "wealth" that the plutocrats enjoy is their ability to legally counterfeit the money supply that everyone else is forced to use, since that fiat money is backed up by taxation and legal tender laws. The established money/murder systems are state religions, which were made and maintained by organized crime effectively controlling governments.

Of course, ultimately, the control over the natural resources matters! BUT, the means to do that is through the money system. That money system is backed by murder. The wars against Iraq, etc., were more about the Anglo-American (Zionist) empire willing and able to go for broke to achieve their goals! In my opinion, when one looks behind the oil companies, one sees the banksters. The central issue is the control of natural resources through controlling the money system, and that is why there are wars started to keep such systems going, by wiping out any kind of competition anywhere. That is the primary reason WHY ONE SHOULD FOLLOW THE MONEY TO THE SOURCE.

The war in Iraq was a manifestation of the overall realities that "our" governments are organized crime, operated by the biggest gangsters, the banksters. Wars are always organized crime on the largest scale: "War is a racket." The War Kings morphed to become the Fraud Kings: "War is the harvest of the bankers." Of course, they want to make more money from controlling natural resources, in ways which make them their greatest profits. However, there is never anything else which comes close to the profit they make from being able to make "money" out of nothing, as debts, while controlling governments to force everyone else to go along with that triumphant runaway financial fraud, which is in an increasingly insane positive feedback of controlling civilization with legalized lies, backed by legalized violence.

Furthermore, if one fully faces those social facts, then the only realistically possible future solutions to these runaway social insanities are to, perhaps, evolve better murder systems, to operate better money systems, in the future. (By better I mean a greater use of information, on more levels, through higher consciousness about those energy systems.) The reasons why that is almost infinitely difficult and dangerous to do is that the established systems work by those actually running them being able to lie the best about what they are doing, while the vast majority of the people being lied to have been brainwashed to believe in the dominant state religion, which was made and maintained by the banksters.

Bicycle Repairman's picture

"the war was actually focused on keeping Saddam's oil off of the market ... so as to keep oil prices high:"

Always my thought.  What's easier. controlling the oil or creating chaos so the oil doesn't get produced.?


Chaos as a weapon.  That's a major theme here.

Urban Redneck's picture

UN Security Council resolutions 687, 692, 705, 706, 778, 986, 1330, 1483, 1546...


TPTB like to hide shit in plain sight, and you shouldn't believe everything you read on them internets.

Racer's picture

And the more the price of oil goes up the more tax that the UK gov can take on it.. 20% VAT is percentage after all, along with the other over 4/10 of the total cost being tax

NuYawkFrankie's picture

Ughh?  It was all about oil? 

I thought it was all about them "hating us for our kosher freedom-fries"... no?

a growing concern's picture

I thought it was revenge for the collapse of the WTC on 9/11.  Those buildings, after all, spontaneously collapsed because of fires caused by aviation fuel, as steel frame buildings have done many, many times throughout history.

PhysicalRealm's picture

Heh.  You left out the 'sarc' tag, but hopefully readers won't need it. 

Duke Dog's picture

However, it seems to me that Big Oil could, and would, have "controlled" the supply from Iraq while owning the resource and infrastructure. Now, if this was demanded by Saudi Arabia, what did we (USA) get in return? - that's the question that needs to be answered.

dick cheneys ghost's picture

we got to keep the petro-dollar, IOW oil priced in $$$$, not EURO's

DawgAss's picture

This is so disgusting, but not suprising!

dick cheneys ghost's picture

A pesky little thing happened right around the time of 9/11.......it caused the US to go full retard with wars and money printing...........That pesky little thing was the Introduction of the EURO, a potential threat to the Reserve Currency status of The Dollar and the almighty petro dollar........The price of gold started its RISE around the same time...........The charts dont lie........

Palast is right, a high oil price was needed to keep OPEC using $$$, not Euro's or any other currency for that matter


This information is nothing new........FOFOA and the freegolders have been saying the same thing............. check out ........'Victor the Cleaner' on twitter



btw.........these assholes having been doing this since the 1970's see YomKippur war and arab oil embargo and the 'birth of the petro-dollar'

Fuh Querada's picture

Which producer of any commodity has an interest in low prices ? Check out diamonds.


Urban Redneck's picture



Nice pointilism (and people wonder why TPTB are able to continually out-think and maneuver the the sheeple)...

Baker is key, but this effort is missing some key facts (points) that have been available from documents leaked even before the 2004 election.

If he wants to name drop boogeymen, he should try Baker, Carlyle, KIA, and the UN (UNCC/OFF)...

Iraq's oil was NEVER going to be seized, despite what little trolls like Wolfowitz may have thought or even testified because they hadn't bothered checking w/ counsel first.

The House of Saud is irrelevant except as ardent and principled supporters of Kuwait (along with the rest of the GCC).  Invasion and expropriation by the US is not a precedent any of them wanted to see, this is the cost of the willingness of the coalition of the willing.

Exxon is also irrelevant to discussion of what actually happened and why.

Palast is either just trying to make a quick buck off the tinfoil hatters desperation for intellectual validation, or he actually sucks at getting to the bottom of things.