Oil & Politics in the Middle-East

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Oil: A Double-Edged Sword for the Middle East Politics

 "Oil. That is what the modern Middle Eastern politics have usually been about." (Shah 1). At the end of World War I, the convergence of two phenomenon led oil and politics to intermingle in the Middle East and this intertwining has lasted up to now. The first of these phenomenon is the beginning of intensive oil extraction. Indeed, since the 1870s, the Western specialists were convinced that the Persian Gulf soils were filled with oil. This belief, which led notably Russia and England to negotiate several oil leases with countries like Persia, Bahrein and Kuwait at the turn of the XXth century, proved to be accurate. On the 26th of May 1908, oil for the first time gushed out of Middle Eastern ground for the first time, in Masjid el Suleiman, Persia, paving the way for decades of petroleum extraction. After World War I, the Middle East became the first oil producing region of the world, and has remained so up to this day. Today, it accounts for 32,6% of oil production worldwide. The second of these phenomenon occurred in the post-World War I period, when Western societies started their energy transition from coal to oil. Oil first demonstrated its advantages on the battlefields of World War I, when it became the main fuel for tanks, planes and trucks. Soon, oil became the "backbone of Western economies [which explains that the] influence and involvement in the Middle East has been of paramount importance for the former and current imperial and super powers, including France, Britain, USA and the former Soviet Union" (Shah 1).

Yet oil and politics do not only intermingle at the layer of the relations between the Middle East and the external powers involved in this region. Oil also constitutes a critical component of the regional Middle Eastern policies, as the "income from oil […] structures the Middle East balance of power" (Gelvin 297). Finally, "oil production has affected state formation […] in the Middle East in a number of ways," (Gelvin 285) which will be discussed later. Oil thus offers a framework to understand the actions of outside powers, the regional dynamics and the internal developments of the Middle East. Moreover, oil also constitutes a common thread between the Middle Eastern countries, each of them being linked to oil in a way or another. Countries like Iran, Irak, Bahrein, Saudi Arabia, Kuwait and Iran started oil extraction during the first half of the XXth century. Other states began oil recovery after World War II, such as Lybia, Dubai, Qatar, Oman, Syria, Egypt and Algeria. Finally, even non-producing oil countries like Lebanon and Turkey are linked to oil through the oil traffic that transits accross their national territories. This geographical situation leads André Bourgey to conclude that the Middle East is the only region in the world where oil constitutes a political concern that involves each country of the region. (Bourgey 244).

What is the nature of the link between oil and politics in the Middle East since the end of World War I? Oil has been a double-edged sword for the Middle Eastern politics, simultaneously a source of power and of weakness, of economic development and of inequalities, and of social stabilization and of conflicts. Primarily a vector of domination for the West upon the Middle East, oil progressively became a lever of emancipation for Middle Eastern countries. This process culminated in the "oil revolution" (Gelvin 285) of the 1970s. Oil then became an ambiguous tool: at the same time a source of "wealth and power" (Rogan 355) and of "vulnerabil[ity]" (Rogan 355).

 

After World War I, the Middle East's oil resources became a source of subjugation to the Western powers. Indeed, during World War I, "oil has become as important as blood" (Clémenceau) for the Western countries. Witness the increase by 130% of the global oil demand between 1914 and 1918, due mostly to the skyrocketing use of military equipment. (Conrad I) In the aftermath of the conflict, an enhanced control upon the Middle East's oil resources thus became more than ever a crucial objective for the European powers and the USA, who seized the post-conflict reconfiguration of the Middle East to achieve this goal. The British succeeded in placing the oil rich province of Mosul under their influence through the San Remo agreements, concluded in April 1920. They also gained a full control of the Turkish Petroleum Company, a firm created in 1912 under the initiative of the British businessman of Armenian origin, Calouste Gulbenkian, to obtain a petroleum concession in Iraq. After having threatened the Iraqis into not endorsing their Constitution, the British obtained in March 1925 the exclusive right to extract, refine and sell Iraqi oil for a period of seventy-five years. Finally, in Iran, the 1933 Anglo-Persian agreement provided a new 60-year concession to the British government, although the British were compelled to increase the royalties and to restrict oil's perimeter of exploitation. Yet the British were not the only Western power to increase their control over the Middle East's oil resources and politics.  During the 1930s, a significant number of Western oil firms also started to set up in several territories on the Arabic Peninsula. The discovery of oil in Bahrein in 1932 led the Standard Oil of California to constitute the Bahrein Oil Company. Two years after, the American Gulf Oil and the Anglo-Iranian Oil Company came together to create the Kuwait Oil Company. Lastly, in 1938, oil extraction began in Saudi Arabia under the control of the United States. This alliance, which took the name of the ARAMCO (Arabian American Oil Company) in 1944, led in February 1945 to the famous Quincy agreement concluded between King Ibn Seud and President Roosevelt. This agreement granted the ARAMCO an exclusive right to Saudi Arabia's oil resources for at least sixty years. In exchange, the USA were to protect the stability of the Kingdom. During World War II, external powers' meddling into the Middle East's oil policies was took a step further through the British forces' invasion of southern and western Iran, combined with the Russian occupation of the country's northern region, in order to secure the Iranian oil fields.  This last example illustrates the form of interference that the Western powers had implemented in the Middle East since the end of World War I: the takeover of foreign companies and powers upon the Middle Eastern oil resources, and if needed, the military protection of these resources.

After World War II, the time of external powers’ unilateral exploitation of the Middle Eastern oil came to an end. In the 1950s, three significant events bore witness of this phenomenon. First, the renegotiation of the oil returns of the ARAMCO to a 50:50 division in 1950 (Rogan 356). Second, the nationalization of oil led by the Iranian Parliament under Muhammad Mossadegh in 1951. Although this decision was cancelled by the 1953 military coup, which overthrew Mossadegh, backed up by the CIA and the MI-6, it still paved the way for an increased independence in terms of oil policies. Third, the nationalization by Nasser of the Suez Canal in 1956 demonstrated the capacity of the Egyptians to slow down the petroleum traffic from the Middle East to Europe, which resulted in considerable financial loss for the Europeans (Musset 163). In the next decade, a decisive step was taken towards the emancipation of Middle Eastern countries through an increased control upon their oil resources with the creation of the OPEC (Organization of Petroleum Exporting Countries) in September 1960. The OPEC was created with an aim of controlling oil prices from unilateral changes. The project was initiated by four Middle Eastern countries - Saudi Arabia, Iran, Iraq and Kuwait - and Venezuela. The creation of the OPEC thus reveals that oil, to a certain extent, constitutes a factor of political unity in the Middle East beyond the ethnic and religion differences. The OPEC indeed gathers Saudi Arabia and Iran, two traditional rivals for the leadership of the Middle East, as Saudi Arabia is willing to embody the leading figure of the Sunni Arab world, whereas Iran is seeking to lead an alternative path in the Muslim world by leading the Shia religion in the region. Oil thus increasingly became a factor of regional unity and emancipation for the Middle East countries in the aftermath of World War II.

In the late 1960s it became more and more popular among Arab countries to think that petroleum could be used as a "weapon in battle" (Rogan 368). However, this weapon turned out to be ineffective during the 1967 War between Israel and the Arab countries. During this conflict, the Arab countries threatened to cease the production of oil for the West, who responded by increasing oil production in other areas of the world. It is within this context that the OAPEC (Organization of Arab Petroleum Exporting Countries) was created in 1968. This reveals that in the 1960s, oil served various political alliances within the Middle East; at the same time oil was used to defend the interests of oil producing countries in general as witness the creation of the OPEC, yet at the same time oil served as the cutting edge of the Arab countries' policy against Israel. In both cases, however, oil was an emancipating political tool. By the end of the 1960s, the Middle Eastern countries decided to use oil to "terminate the concession-type arrangements and [to achieve to] reinstitute national ownership over the resources and national control over levels of production." (Odell 314)

Within this context, the "oil revolution" (Gelvin 285) broke out in the 1970s. Gelvin uses this term to describe the Middle Eastern countries’ takeover of their own oil resources, rendered possible by them "acting in concert" (Gelvin 285). In the beginning of the 1970s, several successive nationalizations attest the birth of this phenomenon. Algeria and Iraq nationalized their oil industry in 1971 and 1972 respectively, followed by Libya’s nationalization campaign in 1971 On the 5th of October 1972, an agreement was signed in New York between the representatives of several American oil companies and the countries of the Arabo-Persian Gulf, laying out a timeline for the latter to progressively purchase full control of their national oil consortia. Yet the decisive step was taken when the Arab countries member of the OPEC decided to act together. Reunited in Kuwait and led by Saudi Arabia, they launched an oil boycott against the Western countries that supported Israel in the October War against Egypt and Syria, triggering the first oil crisis in October 1973. The price of a barrel of oil quadrupled from three to twelve dollars in a period of six months. This unprecedented demonstration of force is evidence that oil had become a tremendously significant source of "power" for the Middle East (Rogan 285). This trend was confirmed five years later, when the Iranian Revolution followed by the Iran-Iraq led the OPEC to decide eight successive price augmentations between the Abu Dabi conference in December 1978 and the Bali conference in 1981. This entailed a second severe global oil crisis, which further certified that oil now represented an instrument of political legitimacy, power and credibility for the Middle East on the international stage.

Oil also contributed to structure the regional balance of power within the Middle East. First, oil established a form of hierarchy between the Arab states. Indeed, "as a result of its income from oil, the Gulf region […] assumed a new and important role" (Gelvin 297) in the inter-Arab balance of power, notably by "assist[ing] the less fortunate [Arab] states" (Rogan 288). The Gulf countries notably represent a considerable source of professional opportunities for the labor of other Arab countries. For instance, between 1973 and 1985, "one-third of all rural Egyptian men worked at some time during their lives in the Gulf" (Gelvin 296). The Gulf countries also provided the other Arab countries with substantial financial assistance, such as when in 1980 Jordan received  financial assistance of over $1.2 billion from the Gulf countries in order to support the welcoming of Palestinian refugees (Benitsy 469). Yet the financial power based on the oil supply of certain Arab countries can and has been used by the latter as an instrument to pressure other Arab countries.  For instance, on the eve of the 1991 Gulf War, Iraq expelled one million Egyptian workers because Egypt was a member of the Gulf War coalition. Furthermore, oil does not only shape the inter-Arab balance of power, but also numerous regional dynamics of the Middle East. For instance, the rivalry discussed above between Iran and Saudi Arabia to become the regional leader of the Middle East, is at the same time partly based on their common legitimacy as major oil exporting countries, and at the same time softened by their common interest as OPEC members. To that extent, oil contributes to the establishment of the dynamics of the political hierarchy peculiar to the Middle East.

Oil also affects the internal political patterns of Middle Eastern countries. As far as oil producing countries are concerned, Gelvin signals that "oil production has affected state formation and sustained autocratic governments in the Middle East." (285) Indeed, "when a country relies on an economy based on oil, oil often turns out to [...] reinforce and worsen social inequalities [...] as well as bolster autocratic political regimes." (De Lestrange, Gaillard & Zelenko 57) From an empirical standpoint, in the Middle East, oil-based economies indeed contributed to enhance social inequalities. Oil has been used as a political tool to reinforce ethnical divisions, like in the case of Gaddafi's use of Libya’s petroleum rent to bolster Libya’s clan-based system. In the Gulf countries, oil revenues have been used to foster the development of infrastructures instead of being equally redistributed among the population. Oil thus contributes most often to increase social inequalities within the Middle Eastern societies. Which shows that although oil confers a significant political power to the Middle East, oil most often constitutes a source of social fragmentation within the Middle Eastern societies.

The post-Cold War era illustrates in a particularly acute manner how oil remains a double-edged sword for the Middle Eastern countries. From a geopolitical perspective, the successive American interventions in Kuwait and Iraq of the last two decades cannot be reduced to a question of oil.  However, what was at stake remains by and large petroleum. These interventions prove that oil contribute to "make a state more vulnerable to outside threats." (Rogan 355) Today, one of the main financial sources of the terrorist group ISIS comes from the illegal oil trade this entity organizes in the region, posing a serious regional and global threat to peace. This reveals that oil remains at the heart of the Middle Eastern equilibrium and conflicts. The paradoxical effects of riches gained from oil can also be seen with global warming. In the long-run, this might undermine the political power of oil. In the Middle East, this leads countries like Saudi Arabia or Qatar to diversify their source of revenues. An example of this is the recent investment in the French football team Paris-Saint-Germain by the Qataris. To conclude, since World War I to this day, oil has not ceased being a deeply ambiguous political lever within the Middle East. Whether at the international, regional or internal layer, oil is a genuine yet ambiguous source of power, that makes the Middle East both politically strong and vulnerable. 

The Cold War in the Middle East, or how the Superpower's Rivalry Intensified local Conflicts and undermined the spread of Democracy.

 The question of the responsibility of external powers in general, and of the Cold War belligerents in particular, regarding the Middle East conflicts is an old-heated debate in international relations and history. Some political scientists, like Lebanese Fouad Khouri-Hélou, argue that the absence of stability that the Middle East has been experiencing since the end of World War II is the result of the American and Soviet imperialism’s influence and interventions within this region. On the other hand, analysts like Dominique Moïsi, a geopolitical Professor at King's College, stresses the ineluctable nature of the conflicts that have been rising in the Middle East since 1945. The nature of these conflicts can be tied, however, to dynamics inherent to the Middle Eastern societies rather than to external interventions.  Was the Cold War the source of the conflicts in the Middle East, and did it prevent democracy from blossoming in the post-World War II period? Or is the Middle Eastern history between 1945 and 1990 mainly independent from the Cold War's interferences? The answer lies is found in a combination of responses to both questions. This essay will therefore bring into focus how the Cold War rivalries between the USA and the Soviet Union both exacerbated local conflicts in the Middle East and stifled the spread of democracy.

Let us first investigate how did the Cold War played a role of catalysts for conflicts in the Middle East. This argument is the core of the demonstration made by Professor Khalidi in his book Sowing conflicts, where he highlights that "the importance of the Middle East in the strategic calculations of the United States and the Soviet Union during the Cold War [....] has probably been insufficiently recognized by analysts." (Khalidi 101) This is illustrated in a particularly acute way in the case of the Israelo-Arab conflict. This conflict was not fully penetrated by the Cold War until the War of June 1967, which "saw a full identification with Israel of the United States." (Khalidi 117) Indeed, the 1960s marked a turning point in the relations between the USA and Israel. Although the United States recognized the Jewish state in May 1948, "President Kennedy was the first to truly consider Israel as an ally state, and to integrate Israel into the US global diplomacy and strategy." (Claude 5) Thus, under Kennedy's presidency, the USA started providing weapons to Tel Aviv, notably Hawk missiles. The objective of the USA was clearly motivated by the Cold War dynamic, namely to "ensure a military balance in the region and to fight against the communist ideology that Moscow was intermingling the Arab nationalism with, particularly in Cairo and Damascus." (Claude 6) Kennedy's successor, Lyndon Johnson, stuck to the same policy. On the other side, the Soviet Union had been leading the Suez Crisis in 1956. This alignment probably mainly resulted from the need of the Soviets to mask their own Eastern European neocolonialism as in 1956 the USSR ferociously repressed the Hungarian uprisings. As the Suez Canal crisis that took place simultaneously with the Hungarian uprisings, it provided the Soviets with an unexpected opportunity to eclipse their actions in Prague by highlighting the imperialism of France and Britain and aligning with the Arab countries. Within this context, the Six Day War functioned as a catalyst in the penetration of the Cold War rivalry in the Arab-Israeli conflict. Until this point, the influence of the superpowers through the supply of weapons to their respective ally was real yet quite limited. After June 1967, the situation significantly shifted. Since Egypt and Syria had lost almost the totality of their air force, they requested high-tech aircraft and antiaircraft missiles to the USSR. Because the Soviets feared the image of "major Soviet client states being left defenseless in the face of an Israel armed and backed increasingly openly by Washington," (Khalidi 121) they succumbed to the Arab states' request. It was a similar reasoning that led the US to supply weapons to Israel in mass in the aftermath of the Six Day war. Pressured by the triumph of Israel over the Arabs, the USA responded to Israel's request to be supplied in high-tech weapons. Because "Israel's victory in 1967 had come to be seen as a victory of a US proxy over those of the Soviets," (Khalidi 122) the USA felt all the more compelled to fully align with Israel. Therefore, the main reason why the USA and the USSR were drawn in the three-year long War of Attrition that followed the Six Day War was therefore their mutual fear of seeing their military prestige threatened by indirect enemies. It followed that the military power, that neither Israel nor the Arab States could have had without the help of the superpowers, considerably increased the violence of the War of Attrition.

The example of the Arab-Israeli conflict clearly illustrates the catalyst role played by the Cold War in the Middle East military confrontations. The USA and the USSR did obviously not create the Arab-Israeli, which is rooted in the post-World War I periode. Yet, they dramatically exacerbated it through their military assistance. Moreover, the involvment of the USA and the Soviets in the Arab-Israeli conflict contributed to increase its importance within the international public audience, notably through the enhanced mediatic representation of the conflict triggered by its integration to the Cold War rivalry. A similar situation can be observed in the case of the Iran-Iraq war, that took place between 1980 and 1988. This conflict was rooted in the aftermath of the 1979 Iranian Revolution, when Ayatollah Khomeini called the Iraqi people to overthrow their leader Saddam Hussein, who had seized power one year earlier. The latter, afraid of the increasing popularity of Khomeini across the Muslim world, decided to invade in Iran in September 1980, triggering the Iran-Iraq War. Moreover, since the establishment of the new Islamic regime in Iran, both the US and the USSR had been "horrified by the radical anti-American and anti-Soviet revolutionary zeal of the new regime." (Khalidi 155) This is the reason why, when the war broke out between Iran and Iraq, the two great powers simultaneously supported Saddam Hussein. The United States started by removing Iraq from the list of state sponsors of terrorism, which permitted the US and its allies to start proving Iraq with some of the technology necessary to produce internationally banned weapons, notably poison gas. At the same time, the Soviet Union was offering absolutely essential military support to the Iraqi war effort. Yet, simultaneously, both the USSR and the USA were supplying arms to Iran, including TOW antitank missiles and Hawk antiaircraft missiles. The degree of violence of the conflict, in which over 1 million of people were killed, and which involved unconventional weapons, is therefore due by and large to the " duplicitous support of both superpowers for both sides." (Khalidi 157) Moreover, "the collusion of the superpowers and their allies was essential to preventing the United Nations from acting to halt Iraq's initial employment of poison gas." (Khalidi 156). Therefore, not only were the USA and the Soviets enhancing the degree of violence of the conflict, but also were they hampering the implementation of the United Nation humanitarian support.. This sordid example demonstrates once again how a conflict that was inherent to the Middle East was worsened by the Cold War.

 

Yet, the damages inflicted by the weapons that the superpower sold to the Middle East was not the only price paid by the region because of the penetration of the Cold War. The impact of the Cold War upon the development of democracy in the Middle East was also particularly harmful. Undeniably, a number of elements inherent to the Middle East explain why did democratical regimes failed to be implemented in the aftermath of World War II. Khalidi explains that during this period, "much of the Middle East [was] affected by having powerful states with a tradition of strong rulers; elites loath to give up their privileges or their control of the political system; high levels of weak political parties, unions, and professional associations" (161). However, although these specific obstacles certainly prevented greater progress toward democracy, the Cold War further prevented the rise of democratical systems. In the Middle East like in other regions of the world, contrary to their official discourse, the US and URSS did not "made the promotion of democracy [....], and [their] meddling in the internal affairs of the countries of the region often served exactly the opposite purpose." (Khalidi 166) This is best exemplified by the subversion of Iranian democracy, which Khalidi describes as perhaps "the quintessential case of both superpowers not only failing to promote, but actually undermining, Middle Eastern democracy in their headlong pursuit of their strategic and economic objectives." (167) Let us analyze why. This event occurred when Muhammad Mossadegh, elected in 1951, launched the nationalization of the oil concessions owned by the Anglo-Persian Oil Company. In order to preserve the financial interest of its British ally, as well as to undermine the increasingly strong influence of the communist Iranian political party Tudeh, the CIA organized a coup in 1953, that overthrew Mossadegh and re-established the power of the Pahlavi dynasty. This coup did not only destroy the democratically elected regime of Mossadegh, but also "announced to the entire Middle East that receptiveness to Western economic demands and rigid, kneejerk anticommunism were the main criteria for those who wanted American support." (Khalidi 174) This example reveals how the Cold War contributed to discredit democratic political forces in the Middle East. Indeed, by undermining the Mossadegh government, the USA showed the Iranian people that their democratically elected government could not embody a respected political entity on the international. Other situations further confirm this phenomenon. For instance, Lebanon was particularly destabilized by Western pressure to join the Cold War alliance in the 1950s. In 1956, the Maronite President of Lebanon, Camille Chamoun, refused to break diplomatic relations with France and the United Kingdom despite their intervention in the Suez Canal. The Lebanese Muslim community condemned this decision, and pressured the government to join the United Arab Republic. Yet the Maronite community was firmly opposed to such a union. During the following two years, tension increased between the different Lebanese communities, and broke out in June 1958. To face the situation, President Camille Chamoun obtained the intervention of 14,000 American soldiers. The reason for the American military support can be understood by "American policymakers percei[ving] that Soviet and Egyptian money and influence were guiding the actions of the Lebanese opposition to Chamoun." (Khalidi 195) Khalidi argues that the American intervention contributed to "undermining [...] the legitimacy of the parliamentary system, [which] was a major precipitant of the 1958 civil war." (196) This example further illustrates how the Cold War contributed to distort the Middle East political systems, and thus to prevent on the long-run democracy to progress.

 

In conclusion, because it "exists [a] continuous confrontation [between the Middle East and] dominant outside political system," (Brown 3) the Cold War particularly intensified the Middle East conflicts as well as undermined the spread of democracy within the region. Yet the superpowers instrumentalized pre-existing conflicts and authoritarian regimes that pre-existed in the Middle East, they did not create them.

© Rosalie Calvet, December 2015

 


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