Was the Iraq War About Oil?
By David Henderson
Reader warning: If you do not “do” nuance, then please don’t read this post and especially don’t comment.
On this 10th anniversary of the U.S. government’s invasion of Iraq, there have been many articles assessing the war. I wrote a piece for Hoover in July 2002 arguing why, if Saddam Hussein did have weapons of mass destruction, that was a reason not to invade. But I don’t want to rehash the wisdom of having gone to war.
Instead, I want to examine a narrower issue that has caused a lot of confusion on both sides: was the second war against Iraq about oil?
In a sense it was, and in a sense it wasn’t.
Here’s the sense in which it was. Various important participants seemed to have thought that it was. Virtually all involved, will, I think, grant that Vice President Dick Cheney had a large influence on the decision to invade Iraq. Here is David Frum’s recollection of part of Vice-President Dick Cheney’s thinking:
In 2002, Chalabi joined the annual summer retreat of the American Enterprise Institute near Vail, Colorado. He and Cheney spent long hours together, contemplating the possibilities of a Western-oriented Iraq: an additional source of oil, an alternative to U.S. dependency on an unstable-looking Saudi Arabia.
So, for Cheney, oil does seem to have been an important factor in his support of the invasion.
Or consider the words of one of the high-level soldiers involved in the war, General John Abizaid:
Of course it’s about oil, it’s very much about oil, and we can’t really deny that.
So at least he and probably many of the people under him thought they were fighting for oil.
But you can do something with motive x even if motive x doesn’t make sense. Which brings me to the sense in which the war wasn’t about oil: From a narrowly selfish point of view, it didn’t make sense to fight war for oil. Here’s where economics kicks in. There is a world market for oil. There is no danger that a country that wants to keep the United States from getting oil can do so simply by restricting sales to the United States. The reason is that it will then want to sell its oil elsewhere. That means that someone who buys that newly freed-up oil will then want to buy less from his suppliers. Those suppliers then have oil to sell and Americans can buy that oil. It’s a game of musical chairs in which the number of chairs equals the number of players. The game would be awfully boring, but in international trade, boring is good.
The only way a country’s government can hurt the United States using the “oil weapon” is to reduce its own production. But then, that country, unless it produces a huge amount of the world’s supply, will hurt itself as well. And that country will hurt its oil-consuming allies and help its oil-producing enemies. I’ve laid this all out in “Do We Need to Go to War for Oil?”
Now, it’s possible that Cheney, Bush, Abizaid, et al were a bunch of economic illiterates. So, again, in that sense, the war could have been about oil even if it didn’t make sense to be about oil.