I have just received an attachment to an email all about the Gulf war and who paid for it, indicating that it was a financial war, not a war based on freedom from oppressors - and implying that the Iraqi war is exactly the same.
I know there have been other posts on this but this makes it really clear. Can anyone find a cite that backs up or disclaims the following information?
The Gulf war cost between $40 and $42 billion US.
25% or 10 billion came from the US, 75% or 30 billion from Kuwait and Saudi Arabia.
Pre-war a barrel of oil cost $15, during the war it cost $42, making an extra profit of $60 billion.
50% of the profit or 30 billion went to the state (Kuwait and Saudi) and 50% or 30 billion to the multinationals controlling the oil deposits.
The oil companies are owned by 7 sisters (Shell, Tamoil, Esso…) which are all American owned, State and private.
So 21 billion profit goes to the US state, and 9 billion to US private sector.
Arab nations spent $30 billion and received $30 billion = 0 profit
USA government spent 10 billion and received 21 billion = 11 billion profit
USA private sector spent $0 and received $9billion profit.
We paid for the war by paying for the oil.
The USA also earned $49billion from selling weapons.
I don’t have any specific cites, but this sure doesn’t sound right to me. For one thing, that claim that a barrel of oil cost $15 just before the war sounds way off. For another, that “21 billion in profit goes to the US state” makes no sense at all, as the US government didn’t and doesn’t sell crude oil. For another, Kuwait wasn’t selling a lot of crude during the war (being occupied by Iraq at the time), and lost all kinds of oil reserves due to the burning of those 700 or so wells by the Iraqis, so I fail to see how they made any money. For another, the US oil companies named in that email were net purchasers of crude, not net sellers.
The day before Iraq invaded Kuwait (and it was a surprise to most of us), West Texas Intermediate’s spot price was $21.59/bbl. and North Sea Brent was $19.93/bbl. You can go here (requires Excel) to see daily prices for the period yourself. What you’ll see is that a.) not all oil sells for the same price and b.) the price of crude managed to get above $40 for five days during the entire period from invasion to the end of the war.
Another bit of historical price data is based on weekly market closes, so you don’t see the few days that saw the price make it to $40. So, the statement that “Pre-war a barrel of oil cost $15, during the war it cost $42…” is patently false and appears willfully misleading.
There are thousands of oil companies. Companies such as Exxon Mobil, Shell, BP, ChevronTexaco and TotalFinaElf together account for less than 15 per cent of world crude oil production. Shell, while a multinational, is a Dutch company and Tamoil appears to be an Italian company now owned by a Dutch group.
I’m having a little trouble following how $21 billion went to the U.S. government, but it doesn’t matter; the whole thing’s gibberish.
The Gulf War cost $61 billion to prosecute, out of which the United States paid $7 billion. Kuwait and Saudi Arabia did cough up roughly $30 billion, Japan and Germany also chipped in significantly.
I don’t have numbers on oil production, but like WillGolf says, the US government doesn’t have an oil business. The idea of Uncle Sam making a profit off the war is nonsense. Might I remind you that the US was running a federal budget deficit of roughly $290 billion in 1991/1992.
Finally, I have no idea what it means for the USA to earn $49 billion from arms sales. We have sold far more arms, both to the region and the world, than the amount cited, but what does that have to do with the Gulf War?