New documents from Whitehall reveal the role that oil played in the UK support for U.S. invasion and occupation of Iraq together with several other countries. According to the documents the UK saw Iraqi oil as vital to the UK's long term energy security.
The privatisation of its oil industry was central to the post-invasion plan for the country, according to previously unseen Whitehall documents. Certainly the U.S. tried to do this but was unsuccessful. Recall that while looters were allowed free sway to vandalise and steal objects from a Baghdad museum the oil ministry was guarded .
The Iraqis put up such a resistance to privatization that they U.S. backed off and tried to pass an oil law that would open up Iraqi oil to foreign investment. That did not work either. This law was one of the benchmarks of progress. There still is no oil law although the Kurds have signed their own agreements with foreign oil. Only PSA Production sharing agreements were put up for auction.
Even though Tony Blair and his ministers' publicly insisted that Iraq's vast oil reserves - then estimated at 112 billion barrels - were a matter for the Iraqis alone behind the scenes the UK was working to obtain favorable terms for UK companies. Officials warned a meeting of the "inter-departmental Oil Sector Liaison Group (OSLG)" that appearing "gratuitously exploitative" in its policy goals - which included the aim to "maximise benefit to British industry and thus British employment/economy" - could "backfire politically". So the official story and what was actually happening had to be different and the latter kept under wraps
Minutes of a meeting held on 12 May 2003 starkly spell out the importance of the issue, stating: "The future shape of the Iraqi industry will affect oil markets, and the functioning of Opec, in both of which we have a vital interest."
London officials outlined a "desirable" outcome for Iraqi's crippled oil industry as "an oil sector open and attractive to foreign investment, with appropriate arrangements for the exploitation of new fields".
The new revealed document concluded "foreign companies' involvement seems to be the only possible solution" to make Iraq a reliable oil exporter. But the document recognised that would be "politically sensitive", and would "require careful handling to avoid the impression that we are trying to push the Iraqis down one particular path".
Greg Muttitt obtained about 1,000 documents as part of his research for his new book Fuel on the Fire.Mr Muttitt said: "These documents demonstrate again the central importance of oil to Britain's thinking on Iraq."
Baroness Symons was trade minister at the time and told BP five months before the March 2003 invasion that UK energy firms should be give a share of Iraq's oil as a reward for Blair's military commitment to U.S. plans for regime change. Documents show that Lady Symons had agreed to lobby the Bush administration on behalf of BP.
In Libya it is the UK and France that are leading the pack. Perhaps they will cut the USA in on any postwar oil developments. No doubt there will be attempts to convince any new Libyan government that the oil sector should be privatized. There may be a similar reaction to that in Iraq. It is one thing to liberate Libya from Gadaffi quite another to liberate Libyan oil for foreign oil companies.