The Bush Administration Strikes Oil in Iraq -- TomDispatch

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The Pentagon-Petroleum Partnership

Another connection, long ignored in the mainstream, that reporters like Kramer might consider pursuing when it comes to the complex ties among Iraqi officials, the Bush administration, the Department of Defense (DOD), and Big Oil is the overt Pentagon connection. The DOD is, as national security expert Noah Shachtman notes, "the world's largest energy consumer." And, when it comes to Pentagon gas-guzzling, its post-9/11 wars and occupations, especially in Iraq, have been a boon. While the Bush administration has been working overtime to clear the path for Big Oil's return to Iraq, the Pentagon has been paying out staggering amounts of U.S. taxpayer dollars to the very oil majors now negotiating with Iraq's Ministry of Oil.

According to recent reports, the proposed Iraqi service contracts, which may be paid off in cash or crude oil, will be worth $500 million each. That is roughly what the Pentagon paid out on June 18 alone – the day before the Times broke its story about Big Oil's return to Iraq – for natural gas and aviation fuel. Over half the total amount, in excess of $268 million, was handed over to one of the oil giants set to benefit from the Iraq deal: BP (formerly British Petroleum). Only days earlier, two of the other majors from the coterie of potential no-bid contractors, Exxon Mobil and Chevron, nabbed contracts from the DOD – in Exxon Mobil's case, a $73 million deal for gasoline and fuel oil; in Chevron's, a $16 million contract for aviation fuel.

Keep in mind, however, that – although you won't learn this in your daily paper – this has long been standard operating procedure. Each of the oil giants named in the original New York Times piece – Exxon Mobil, Shell, Total, BP, and Chevron – regularly show up on the Pentagon's payroll. In fact, last year, Iraq's new fave five took home more than $4.1 billion from the DOD – with Shell leading the way with $2.1 billion.

It's no secret that the Pentagon relies on vast quantities of oil to power the ships, planes, helicopters, heavy armor, and other ground vehicles essential to its occupation of Iraq, nor that it regularly pays out vast sums of taxpayer dollars to the very companies that U.S. advisers have aided in working out oil deals with the Iraq Oil Ministry. Despite ample evidence of the Pentagon connection, this circular and mutually-reinforcing relationship has been almost totally ignored in the mainstream media. But think of it this way: Your tax dollars have given the Pentagon the opportunity to use up oil – bought from the oil majors, in prodigious quantities – in order to create a situation in Iraq in which those same majors will soon receive no-bid contracts to make money off the Iraqi oil industry and, if all goes well, get far better, longer term deals in the near future.