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Blood may be thicker than water, but oil is thicker than both.
-Perry Anderson, "Scurrying Towards Bethlehem," New Left Review, July-August 2001
In his 2006 State of the Union address, George Bush finally put into words what all previous presidents could not bring themselves to utter in public: addiction. The United States, he conceded, is "addicted" to oil-which is to say addicted to the car-and as a consequence unhealthily dependent upon Middle Eastern suppliers. What he neglected to mention was that the post-Second World War U.S. global oil acquisition strategy-a central plank of U.S. foreign policy since President Roosevelt met King Saud of Saudi Arabia and cobbled together their "special relationship" aboard the USS Quincy in February 1945-is in a total shambles. The pillars of that policy-Iran, Saudi Arabia, the Gulf oil states, and Venezuela-are hardly supplicant sheep within the U.S. imperial fold.
With surplus capacity in OPEC at an all-time low and speculation running rampant in the commodity exchanges, Big oil is awash with money. Corporate profits are historically unprecedented. Chevron netted a cool $14 billion in 2005, and first quarter earnings in 2006 are 50 percent higher than the previous year, a historic high obscene enough to have Congress muttering about a windfall profits tax. So-called supply risks in Iran, Venezuela, and Nigeria coupled with the speculative impulses of the oil traders have driven up the price of oil to around $70 a barrel, and a former oilman (surrounded by a posse of former oilmen) stalks the halls of the White House. As if that were not enough, the New York Times (March 27, 2006) reported that through a "vague law" the U.S. government will waive, for the oil supermajors, about $7 billion in state royalties over the next seven years. All of this takes us back to the 1973 oil embargo and President Nixon's Project Independence, designed to achieve U.S. self-sufficiency by 1980. The policy failed miserably (U.S. dependency upon imported oil in the late 1960s was 20 percent and is expected to be about 66 percent by 2025) and Nixon resorted to maximizing domestic supply and turning to reliable foreign suppliers at minimal cost-just as George Bush intends to do.
It is no surprise, then, that alternative sources of oil should...