Oil Omissions: Bush Senior, Cheney Have Big Stakes in Saudi Status Quo

Oil Omissions: Bush Senior, Cheney Have Big Stakes in Saudi Status Quo

18 October 2001

The New York Times ran an interesting article Sunday, as interesting for what it did not say as for what it did.

Headlined, “Fears, Again, of Oil Supplies at Risk”, the piece by Neela Banerjee addressed the nightmares that George W's war has raised among those concerned about oil. Politicians and oil executives imagine, says Banerjee, a potential domino effect that could end up with angry Persian Gulf states cutting off the flow of oil to the west, terrorism blocking its transport through the Strait of Hormuz and even Osama bin Laden taking control of Saudi Arabia from a toppled Saud family.

“If bin Laden takes over and becomes king of Saudi Arabia, he'd turn off the tap,” Roger Diwan, a managing director of the Petroleum Finance Company, a consulting firm in Washington, told Banerjee. “He said at one point that he wants oil to be $144 a barrel - about six times what it sells for now.” And Saudi Arabia, the Times reminds us, is Osama bin Laden's Enemy No. 1: “Mr. bin Laden has long made clear that his ultimate goal, more than wreaking havoc in the West, is toppling the Saud family. And Saudi Arabia would be a crucial target for anyone seeking to cut deeply into the world oil flow.”

Banerjee restates other points that need emphasizing, such as the fact that while U.S.-dependence on Gulf oil is down to 13 percent of overall use, Saudi Arabia is still the country's biggest single supplier of crude. Moreover, “The Saudis are the only ones with enough spare oil-field capacity to call on if there is a severe disruption elsewhere,” he writes. There are some major omissions, however, in Banerjee's piece. The first of these is that in an article focusing on Saudi Arabia, oil and the United States, there is no acknowledgement of the Bush family's ties to the corrupt Kingdom of Saud, and its explicit investment in maintaining the status quo in that fundamentalist country.

Most obviously, ex-President and ex-CIA Director George Bush has been working his assets for the Washington-based Carlyle Group, a $12 billion private equity firm, since he left office. He specializes in Saudi Arabia and certainly has in interest in the Kingdom's enduring profitability.

The public-interest law firm Judicial Watch earlier this year strongly criticized this situation, pointing out in a March 5 statement that it is a “conflict of interest [which] could cause problems for America's foreign policy in the Middle East and Asia.” In a Sept. 29 statement, Judicial Watch added that, “This conflict of interest has now turned into a scandal. The idea of the president's father, an ex-president himself, doing business with a company under investigation by the FBI in the terror attacks of September 11 is horrible.” They demanded President Bush make his father pull out of the Carlyle Group.

Additionally, an article about oil supplies that doesn't mention the Caspian Sea is quite something to see. Banerjee entirely ignores the story that is burning up progressive talk radio waves this month, and buzzing around thoughtful alternative Web sites. Hidden behind President Bush's war to avenge the victims of September 11, could there be an Oil Agenda? Michael Klare, author of “Resource Wars,” has suggested that the long-term Bush/Cheney plan is to establish a Pax Americana in Central Asia and secure the vast oil resources of the Caspian Basin.

U.S. oil companies have been negotiating with the post-Soviet republics of Kazakhstan and Turkmenistan for access to the oil for years, but have been stymied by political instability in the region. Oil conglomerates were torn between two possible pipeline routes to Western markets: west through the war-torn Caucasus Mountains to Turkey, or south through war-torn Afghanistan to Pakistan and the Arabian Sea.

Until it was put on hold in 1998, Unocal, which spearheaded the Afghan project was to have built a 1,005-mile oil pipeline and a companion 918-mile natural gas pipeline, in addition to a tanker loading terminal in Pakistan's Arabian Sea port of Gwadan. The company projected annual revenues of $2 billion, or enough to recover the cost of the project in five years. As reported by journalist Jan Goodwin, Unocal opened offices in Kazakhstan, Uzbekistan, Pakistan and Turkmenistan and got every faction of the Afghan Northern Alliance to sign on. Even former Secretary of State Henry A. Kissinger got on board to help sell the project in the region. [See: New York Times, 12/5/98]

Backing the Caspian plan is none other than Vice President Dick Cheney, who, as CEO of Halliburton was successful in winning contracts from Caspian Sea states to be part of any future development. In 1994, Cheney helped to broker a deal between the oil company Chevron and the state of Kazakhstan when he sat on the Oil Advisory Board of that former soviet state.

The Amarillo Globe-News reported on a 1998 talk to oil executives in which Cheney said that "the current hot spots for major oil companies are the oil reserves in the Caspian Sea region. Former Soviet states Azerbaijan, Kazakhstan and Turkmenistan all are seeking to quickly develop their oil reserves, which languished during the years of Russian domination." The stakes in that region could be as much as 200 billion barrels of oil and natural gas, he told the crowd.

“The potential for this region turning as volatile as the Persian Gulf, though, does not concern Cheney,” the article continued. “You've got to go where the oil is,” he said. “I don't worry about it a lot.”

In a story about oil fears and worries, the New York Times failed to ask the obvious question: Is Cheney worried now? And if not, why not?

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