[QUOTE=BrainGlutton]
I hope you are not really expecting American oil companies’ control of foreign oilfields to translate automatically into lower prices at the pump. Perhaps you are assuming that oil companies, like most manufacturers and most wholesalers, want to buy the raw material as cheaply as they can, and then either pass the savings along to the end consumer, or pocket the difference. Actually, in their industry it is often more profitable for them to buy dear than to buy cheap. As explained by Greg Palast in his book Armed Madhouse:
Maintaining the status quo for the oil companies requires holding down oil production, and Iraq has been assigned that sorry role since it was founded (it has 74 known oil fields and only 15 in production). In 1927, the major oil company execs met at a hotel room in Belgium and signed an agreement: The Anglo-Persian company (now British Petroleum) would pump almost all its oil from Iran; Standard Oil, under the name of the Arabian-American Oil Company (Aramco), would limit almost all its drilling to Saudi Arabia; Anglo-Persian would drill in Iraq’s Kirkuk and Basra fields but it would drill very little.
In the early '60s, the frustrated Iraqi government canceled the BP-Shell-Exxon concession and nationalized the oil fields, but that didn’t solve the problem.
So why did Hussein – a secular Ba’athist, no sponsor of Islamist terrorism, possessing no WMDs, contained as a military threat, yet arguably still useful as a counterbalance to Iran – why did Hussein, finally, have to go?
Whatever “oil law” the Iraqi Parliament finally approves, whatever military or political settlement finally emerges, whoever ends up owning or running Iraq’s oilfields, I have no doubt the OPEC production cap will continue to be enforced and the global price of petroleum kept stable – and higher than it would be in a free competitive market without cartelization. Because that is in the common interest of both the OPEC nations (most of them, anyway) and the international oil companies. It’s not in your interest or mine, but there you are.
[/QUOTE]
Excellent analysis: except to add: IRAQ has vast reserves-and hasn’t been producing in any significant way for 5+years. It would not surprise me to learn that Iraq has more reserves than Saudi Arabia. The obly problem: getting it out: you either pump it to Basra on the Persian Gulf (and load onto tankers), or pump into the pipeline that crosses Syria. Either link is vulnerable to sabotage. The emergence of an Iraq in full production is something OPEC won’t like.