Wednesday, June 05, 2013
After the George W. Bush administration launched the 2003 invasion, officials promised that access to Iraq’s oil supplies would result in the war paying for itself.
That hasn’t happened, in large part because most of the Iraqi petroleum is flowing east—to China.
Almost half of the country’s oil supply is bought by Chinese companies, which intend to purchase even more in the near future. They currently have their eyes on one of Iraq’s largest oil fields, which is owned by Exxon Mobil.
“We lost out. The Chinese had nothing to do with the war, but from an economic standpoint they are benefiting from it,” former Pentagon official Michael Makovsky, who worked on Iraqi oil policy during the Bush administration, told The New York Times.
It was following the overthrow of Saddam Hussein that Chinese companies began investing $2 billion per year in Iraq, placing hundreds of workers in the country and winning oil contracts, even if it meant—unlike its Western counterparts—accepting lower rates of profit.
One upshot of the Chinese buying so much of Iraq’s oil is that the Asian giant needs less from other suppliers, which should result in cheaper petroleum elsewhere for American companies, Max Fisher wrote at The Washington Post.
China is the world’s biggest oil importer, having invested $12 billion in global oil and gas fields in 2011, with 50% of its oil coming from the Middle East.
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