Mainline: Geostrategy Feeds America's Oil Addiction

The large players in oil - Saudi Arabia, Canada, Kuwait, UAE, Libya and Nigeria - are playing in toe with the US and British Administrations. The problems lie with the Soviet Union, Iraq, Iran and, Venezuela.

By Jacob Matthan
Published March 01, 2006

With no end in sight for America's oil addiction, it is imperative for the neoconservative agenda that the US controls the trade of oil and natural gas to maintain Dollar Power.

The Oil Bourses run by the US in New York and the British in London have allowed the US to print unlimited amounts of the US Dollar and the British to hold on to their emotional Pound Sterling and stay outside of the Euro currency zone.

Any threat to Dollar or the Pound Sterling would cause an upheaval so enormous that the US Depression of the Twenties and Thirties would look like a children's Happy Holiday party.

Woe betide any country that shows up to be resource rich. The economic hitmen would soon be around to start their play. Control, per se, of resource has not been enough in their game.

The large players in oil - Saudi Arabia, Canada, Kuwait, UAE, Libya and Nigeria - are playing in toe with the US and British Administrations. The problems lie with the Soviet Union, Iraq, Iran and, Venezuela.

Oil Reserves by Country, 2005
Rank Country Proven Reserves (billion barrels)
1. Saudi Arabia 261.9
2. Canada 178.8
3. Iran 125.8
4. Iraq 115.0
5. Kuwait 101.5*
6. United Arab Emirates 97.8
7. Venezuela 77.2
8. Russia 60.0
9. Libya 39.0
10. Nigeria 35.3
* Leaked internal records reveal that Kuwait's reserves are actually less than 50 billion barrels

In the case of natural gas, the situation is worse, as the Soviet Union, Iran, Venezuela and Iraq lie outside of the control of the US/British "axis of evil".

Natural Gas Reserves by Country, 2006
Rank Country Proven Reserves (trillion cu. m.)
1. Russia 47.57
2. Iran 26.62
3. Qatar 25.77
4. Saudi Arabia 6.65
5. United Arab Emirates 6.01
6. United States 5.35
7. Nigeria 4.98
8. Algeria 4.55
9. Venezuela 4.28
10. Iraq 3.12

With the oil rich former states of the Soviet Union now controlled by puppets of the US, the next in line for destabilisation were Iraq, Iran and Venezuela.

Target One was the ways and means to get the oil and natural gas economically out of the land-locked Caspian Sea region to the international market, making Afghanistan the first target of the neocon agenda. This has been played out.

However, the pipeline scenario to take the products out of the region is still a major headache. A puppet government in Afghanistan permitting the permanent residence of US and British (NATO) forces is essential in this strategy.

Target Two was Iraq. Despite the catastrophe, chaos has been established, and Iraqi oil is firmly in the control of the US corporations.

Target Three was Iran. This destabilisation process is now in play.

The intention has been to invade Iran. To do that there has to be provocation. With a moderate leader in power, this would be difficult, as diplomacy would be the name of the game. A radical had to be elected. The US needed a demonic character to point the finger at.

Many theories abound as to the fraud and stealing of the last Iranian election. Was President Mahmud Ahmadinejad of Iran actually elected by the people of Iran? Is it not more likely that the US engineered the election of this radical?

Since his election, President Ahmadinejad has not failed his US neocon admirers with his outpourings, posturing and defiance, making Iran an easy target for the US and the world.

Target Four is Venezuela. This act has been in play for a few years, but the massive grassroots support for President Hugo Chavez, not only in Venezuela, but also in Latin and South America is proving problematic for the US neocon agenda. However, the end game is approaching.

Indian Influence

US President Bush is to visit India in March 2006. He is not going to receive a pleasant public welcome.

Here are a few headlines that appeared on January 26th, the Republic Day of India:

William M. Arkin, The Nuclear Option in Iraq, The Los Angeles Times, January 26, 2003

Mike Whitney, Iran's Oil Exchange Threatens The Greenback, Dissident Voice, January 26, 2006

Dan Dombey, US warns India to back Iran UN referral or lose nuclear deal>, Financial Times, January 26, 2006

India Rejects U.S. Attempt to Link Iran Vote to Nuclear Accord, Bloomberg, January 26, 2006

India summons US envoy over Iran, BBC News, January 26, 2006

The Indian Government is bending over backwards, as a result of corporate pressure, to keep relations cordial between the US and India and protect the huge inflow of outsourcing business from the US. The Indian urbanisation boom, at the expense of the America middle class, is essential to keep Indian growth rate at the eight to ten percent level.

Many major Indian corporations are benefiting greatly from the mismanagement of the American economy by the Bush administration. They are anxious to keep this US Administration group in power at any cost.

India voted to move the Iran nuclear issue to the UN Security Council. The Indian Government says that it did not take notice of a US threat to withdraw civilian use of nuclear technology. US needs to market this civilian nuclear technology to business, but India does not depend on this source. They have alternate plans in place with France and Russia.

The underlying reason for the shift in the Indian stand on Iran was at the behest of the Indian multinationals, who did not want to cause problems for the Bush Administration as they enjoy the enormous fall-out benefits of the Bush Administration's policies.

Intelligent, concerned Indian liberals are, on the other hand, planning mass protests to follow Bush. They intend to show the displeasure with the policies being followed.

Target One: Afghanistan

What did the innocent people of Afghanistan do to be bombed to oblivion? What logical reason could there be for the North Atlantic Treaty Organisation (NATO), having its presence in Afghanistan? Should NATO now be renamed as the Arabian Sea Treaty Organisation?

Cliché - 9/11!

The attack on Afghanistan had nothing to do with 9/11, Osama bin Laden or the Taliban. With the now white elephant, Dabhol Thermal Power Plant, being constructed south of Mumbai by a subsidiary of Enron Inc., the firm was desperate to get access to the cheap natural gas and oil from the land-locked Caspian Sea area.

The Dabhol project, located on the Maharashtra coast approximately 180 kilometers south of Mumbai, was to be Enron's flagship project in India. Dabhol Phase I was to generate 740 MW of power and begin operating in May 1999.

When Phase II was completed at the end of 2001, Dabhol was to have generated 2,450 MW of power to become the world's largest independent natural gas-fired power plant.

Enron hammered its way to get everything in place, but the final outcome was that the Indians saw through this ruse and killed the project, which added to the woes of a company tottering on the edge of collapse.

The nations involved - Azerbaijan, Kazakhstan, and Turkmenistan - are sitting on about 10 percent of the earth's potential oil reserves. Proven reserves are between 16-32 billion barrels of oil. About 100-300 billion barrels are not yet proven.

Route for Natural Gas Pipeline from Iran to India (click on the image to see a larger map in a new window)
Route for Natural Gas Pipeline from Iran to India (click on the image to see a larger map in a new window)

The pipeline was to have run through Afghanistan, into Pakistan and across to Delhi, with a feeder from the Multan-Delhi pipe direct to Dabhol. The gas pipeline across Pakistan was to have a spur to the seaport of Gwadar to ship the raw materials to the proposed Dabhol terminal.

A pipeline through Iran would have been the most economical solution. The shorter distance and the well developed oil production and exporting capabilities were plus points. But the U.S. had to control Iran before this option could be considered, hence the inclusion of Iran in the "axis of evil".

Politically speaking, Americans wanted to see the oil distributed away from the volatile Middle East, which already controls the bulk of the world's supply. Hence, the unprovoked attack on the nation of Afghanistan, with American creation Osama bin Laden providing the ideal foil!

Target Two: Attack Iraq

As Colin Powell's former Chief of Staff, Lawrence Wilkerson, said on the PBS Program NOW, the pre-war intelligence in Iraq was a "hoax on the American people". The US was quite happy with sanctions in place on Iraq as the Oil-For-Food programme netted huge profits for many US corporations.

With sanctions likely to be lifted, and the threat by Saddam Hussain to deal Iraqi oil in the Euro rather than the US Dollar loomed closer, it was the straw that broke the back of the US neocon administration. The Project for the New American Century (PNAC) document dated 1998 had spelt out the details but was rejected by President Bill Clinton.

Bush was there to convert an idea into reality, hence the pounding of the war drums to take out Iraq and to take control of Iraqi oil. It is not necessary to repeat here what everyone knows were the falsehoods used to invade and occupy Iraq.

Target Three: Attack Iran

Iran broadened its oil and natural gas goals away from US controlled markets as demand burgeoned in China and India. Iran has also been talking about starting the Iranian Oil Bourse. Further, there is the deal between Iran and energy starved nuclear power India, for the former to supply natural gas directly to the latter via a pipeline through Pakistan.

The proposed 2,600-kilometer gas pipeline from Iran to India would cost $7.6 billion and would carry natural gas from Iran, through Pakistan, to India. Strained relations between India and Pakistan prevented negotiations progressing during the last decade. With the current thaw, the proposal gained new momentum.

India needs the Iranian gas. India produces only half the natural gas it needs and imports 70 percent of its crude oil. India must tap new energy sources to sustain the eight to nine percent growth.

Pakistan favoured the project as it would generate $1 billion annually in transit fees. Each year, Iran could ship five million tons of natural gas to India over the next 25 years. These shipments would be worth approximately $22 billion dollars.

With this, and with the exploding demand by China for Iranian energy, the Iranians were confident they could start their own Oil Bourse. No US or European players were needed in either of these markets. That was too much for the US Administration. The US Dollar is tied to energy resource capitalisation.

There are two important aspects to the Dollar Security. The first is the transportation and the super profits to be gained out of controlling the international trade of oil and natural gas. The second is the enormous national debt of the US and the way it is financed - in worthless paper, which the US can produce by the shiploads - the US Dollar and Treasury Bills (T-Bills).

The first step of the US administration was to try to destroy this Iranian-India deal by lifting the sanctions on India to supply technology for furthering nuclear power generation in India. When this did not stop the deal, then came the more direct attack on the deal with a threat to India to stop talking natural gas supplies - or else.

This deal would provide the much needed finances for Iran to establish its independence of the Oil Bourses in London and New York, which would be a huge tragedy for the American economy. Without control of the Oil Bourse, the American Dollar could lose its power on the world stage.

All the talk about Energy Security, which was the prime subject of the recent G8 summit in Moscow, was aimed primarily at maintaining the dollar at the centre of the oil bourse.

Swiss banking giant UBS AG has announced it is no longer doing business with Iran due to "the company's economic and risk analysis of the situation in that country."

Iran is under increasing international pressure over its nuclear program and mindful of the freezing of its U.S. assets after the 1979 seizure of the American Embassy in Tehran. The nation has an estimated $50 billion in European banks and Iran's Central Bank governor said over the weekend that it will move its reserves quickly if it deems it necessary to do so.

There are several issues at stake with the huge budget deficit that the US has run up. The only way that the US can continue this policy is to prop up the US Dollar by printing more notes and issuing more T-Bills. This can only be done so long as the US has ensured that other countries keep their end of the bargain by accepting the dollar as the preferred currency of trade and by investing in T-Bills.

Any doubt in either could cause the US Dollar edifice to tumble like a pack of cards. At this stage, selling of the family jewels is the only alternative available to prop up the US Dollar. Hence such deals as the takeover of the sea ports by all those who hold the US currency and T-bills, immaterial of the security of the US!

As Scott Ritter, the now "discredited" former US member of the UN Weapons Inspection Team said recently, the attack on Iran is imminent after a dramatic speech at the UN by interim Bush appointee, US Ambassador, John Bolton. Asked how he knew, Ritter replied that he had got the information from the horse's mouth, the speech writer!

That Peninsular and Oriental Steam Navigation Company (P & O), the British firm that owned several ports in the US, decided to cash in and get out by disposing US ports to an energy-rich country, United Arab Emirates, is the best possible pointer of what lies ahead for the US Dollar.

Jacob Matthan is a writer, activist, and retired technology consultant who lives in Oulu, Finland with Anniki, his wife of 39 years. He maintains a political blog at http://jmpolitics.blogspot.com/.


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By aequitas (registered) | Posted March 02, 2006 at 00:00:00

I agree with your assessments but I would be interested in hearing your views on how American actions might be effectively countered or reacted-to in places like Hamilton or Oulu. Do we just sit back and watch, hanging our heads in shame when decent people ask for our reactions?

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By jmatthan (registered) - website | Posted March 02, 2006 at 00:00:00

Nobody can afford to sit idly by. I hope you read Arundhati Roy's comment on Bush's visit to India. (You can read the text on my blog site.) Not only was it hilarious but it showed the tragicomic situation that is facing the world. I am doing several things, and that means being in touch with several US Liberal Talk Show Hosts who speak the truth. Extend all support to them and see that you expand their audience reach. Do not watch the MSM TV as that is a waste of time. Support the Blogging Community all you can, such as Blogs of experienced and respected people such as Steve Clemons of The Washington Note, Congressman John Conyers jr., etc. Add to Comments on Blogs wherever possibly giving constructive criticism. I was actively encouraging Cindy Sheehan from my location in Finland. She knew that with support from around the world it was important to carry on her work. Write and ridicule all those who you know who are the problem, even if they be Democrats as Joe Liebermann! i have been hammering Barrack Obama as a fake democrat - because his actions and words never match. let them know that the world is watching them, not just Americans. Take part in Discussion Forums - when I joined Democratic Underground it was just 20,000 participants. Today it is over 80,000. I express my opinions strongly there so much as to influence many people, even possibly educate many. So it does not matter whether I am sitting in a cellar in the frozen Arctic as each one of us can influence events by active participation. Can one man make a difference - YES. AST was the 5th or 6th largest computer company in the world. they sold me a defective computer and tried to cheat me. I started a one man international campaign in 1996. AST does not exist any more. can you imaging the power of you and me acting together from Hamilton and Oulu. It is an unstoppable force.

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By Nancy Fulton (anonymous) | Posted None at

Someone's gonna see us on the battlefield? Yeah, that rule of law, democratic republic thing will never catch on. Anyway, I think you are right. I think today's deal to give nuclear technology/information to india is "payment in advance" for an attack on Iran. Just a guess . . .

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By Tony (anonymous) | Posted March 03, 2006 at 09:27:03

The Soviet Union fell apart a long time ago. I am surprised you keep referring to it. In the oil sector we call it the FSU, Former Soviet Union when we want to talk about oil reserves.

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By jmatthan (registered) - website | Posted March 03, 2006 at 03:18:48

Dear Nope Nope - 80,000 delusional people on DU? I cannot agree with your hypothesis. I have seen great postings on the DU Forum almost every day. You may not agree with their views, but most major postings are well thought out. Also, it is single source for Latest Breaking News from around the world - well before the mainstream Media wakes up to a story. So I do not have to watch TV as I can get hold of a story without being subjected to the "white woman missing" stuff. Dear Nancy - No not payment in advance. Just Indian Industrialists milking the situation of a stupid President and his policies. Why kill the goose that lays the golden egg? Dear Tony - Sorry, should have read as "lay" instead of "lie". However, the next sentence under the table correctly states "With the oil rich former states of the Soviet Union now controlled by puppets of the US,..."

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By Bob Kincaid (anonymous) | Posted March 06, 2006 at 11:01:52

Your mention of talk radio hosts who "speak the truth" is a volume in itself. The critical factor for the U.S. is awareness. Where Jacob doesn't waste his time with "missing white woman stories" millions upon millions of Americans do. Right now, that's ALL they pay attention to, with the exception of "reality" TV, sports and the weather. But we truth tellers will be there when the scales fall off their eyes. Making sure we're able to be there is what's important. In the U.S., we need to pay attention to the advertisers in markets that carry liberal talk. We need to avoid advertisers that support militaristic right wing hate talk. A lot of our current problems may be easily traced to the anti-labor, anti-middle class, anti-fairness policies whose genesis lay in the Reagan Administration. The rise of hate radio also lies therein. It is the elitism of liberal "leaders" who thought talk radio "gauche" or "meaningless" who helped create this problem. Now that the blinders are off, people need to hear others talking about liberal ideas. In a free market of ideas, liberal talk wins the contest, in the main because it deals in facts and not hate-driven propaganda.

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By Ron DeWitt (anonymous) | Posted March 12, 2006 at 05:40:12

Wow!!!! I have been studying this. We put our money out there for good reasons of keeping world wide trade stable. That was done under the Brenton Woods Agreement to keep trade stable after the WWII so we would not have WWIII. Now Iran is trying to kill us just because along with Germany. Out of time. Ron ron77511@yahoo.com

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