Yes, Donald Trump is working closely with the oil and gas industry. He’s hired several former fossil fuel lobbyists and executives to head up federal agencies–including Rex Tillerson, former ExxonMobil CEO, as Secretary of State. One former cabinet member, Department of Interior Secretary Ryan Zinke, even told a gathering of industry executives, “our government should work for you.”
And yes, Trump has also cultivated close relationships with autocrats in charge of petro-states like Russia and Saudi Arabia.
But a close reading of American history shows — this may not be so new. Oil, and access to it, has dramatically informed American foreign policy for more than a century. Since it was discovered in 1859, oil has equated to power, and the U.S. and other Western powers have gone to great lengths to protect their access to it.
This is the story that Matthieu Auzanneau’s book Oil, Power and War: A Dark History (Or Noir) (Chelsea Green, 2018) sets out to detail. The book is a sweeping history of big oil’s influence over global politics, from the 1850s until now. And it explains a lot about the world we live in.
“We must ask,” Auzanneau writes, “who had the stronger hold over the other: Uncle Sam or Big Oil? American political power deployed its empire thanks to control over sources and flows of oil far greater than those of other nations. But simultaneously, the oil establishment was able to put its own interests above the political sovereignty of the American people.”
The book’s subtitle, “A Dark History,” alludes to some of the not-so-well-remembered ties between the American oil industry and Nazi Germany, the creation of Iraq by the Western powers to divvy up the region’s oil resources, the CIA-engineered coup of Iran’s democratically-elected prime minister in 1953, and the role oil played in the rise of Middle Eastern strongmen like Saddam Hussein and Muammar Gaddafi. It also explains the special relationship between the U.S. foreign policy establishment and the House of Saud from the 1930s to the present.
Auzanneau joined Trump on Earth host Reid Frazier to discuss the book, and why oil has kept a grip on the levers of power at the highest levels of government.
Reid Frazier: This is a book about the intricate relationship between the oil industry and what we’ll call the Western powers, primarily the United States, the U.K. and, to certain degrees, France and other countries. What got you interested in this topic?
Matthieu Auzanneau: It goes back to my teenage years. I think watching the movie Mad Max made me think a lot. I thought that’s an interesting question: what happens if oil becomes scarce and what is the link between energy and power?
Perhaps more seriously, I was impressed (so to speak) by the invasion of Iraq in 2003. And it was like, what are the odds that the Bush family and the bin Laden family knew each other for several decades. And I started wondering, what is the Bush family phenomenon exactly? Is it a singularity in American history or is there a thread, a link between big oil, on one hand, and political power?
And you realize that when you talk about power, whether it’s political power or corporation power or even individual power, there is a compact relationship with the ability to have the proper sources of energy to exercise power. Actually, that’s the whole frame of the book. Who had the energy means to exercise its power during that 20th century, which was the century of the explosion of the expression of human power?
RF: Yeah. Let’s go back into that history. This book starts essentially with the Standard Oil era from around the 1870s to about 1911 when the U.S. government “broke it up” and I’m using air quotes because parts of it remain intact to this day. How foundational was Standard Oil in this story that you’re telling of oil and economic, political, even military power?
MA: I think that the name Standard Oil and the name Rockefeller is a symbol of U.S. capitalism. And if you look back at the foundation of Wall Street, you realize that the two main banks, the two pillars of Wall Street — the Chase Manhattan and what has become Citigroup — both are Rockefeller banks. That is to say, banks that developed thanks to the incredible profits of the oil industry. You have to say it’s exceptional because there are no industries that are as generous as the oil industry when it comes to creating profits. And that is for a physical reason. When you drill a normal well, you have to drill it and then you have to plug it to a pipeline. And then if you are lucky, you’re sitting on an actual goldmine for many years, or even many decades if you are very lucky, like the Saudis or like the U.S.
You have to remember symbols like the fact that the United Nation headquarter is built on land that was given by the Rockefeller family. That is a symbol of how profound the extension of the power that was given to the Rockefeller family by black gold. And then given by the Rockefeller family to American capitalism.
RF: You surveyed how many of these Western countries set about to control oil reserves. This was a very important aspect of global policy throughout the 20th century, but especially after World War II. There are so many countries that you survey –Iraq, Iran, Saudi Arabia–that are absolutely critical to understanding our foreign policy today. Can you walk me through how the oil industry in the Middle East used American foreign policy and how integral the U.S. government was in helping these companies achieve dominance over some of these oil reserves?
MA: That’s the key. As you’ve understood the whole frame of the book is to try to tell the history of power, political power, military power, corporation power, through the necessity of having access to the proper energy resources to exert that power.
It’s very interesting for me to notice that the U.S. economy was once the first energy producer and oil producer and also exporter. And then something happened, which is a natural phenomenon. In 1970, conventional oil production in the U.S. entered a long decline for environmental reasons. That’s the starting point of the dreadful projection of force by the U.S. to control the chessboard of energy in the world, which went from the U.S. to the Persian Gulf precisely when the oil production in the U.S. started to be too low to fill the tank of the U.S. economy.
“You do not understand anything about what happened from the ’80s until now if you don’t realize that to exercise its paramount power, the U.S. economy has to dominate the Gulf region.”
When you realize that, for instance, the way the geopolitical masters in Washington used Iraq and Saddam Hussein to fulfill their goal, which was to plant the U.S. flag very firmly in the Gulf region and to achieve the main goal, which was for the U.S. to remain the sole and ultimate hegemonic power at the center of the energy chessboard, which was the Gulf War.
Al-Qaida came from that. You do not understand anything about what happened from the ’80s until now if you don’t realize that to exercise its paramount power, the U.S. economy has to dominate the Gulf region. The Bush family, father and son, they were very much on that agenda. And in some extent, Donald Trump is still on that agenda. Usually, political leaders talk about energy independence. Donald Trump talks about energy dominance. So for me, there’s a continuous thread for the U.S. economy.
But you have the same kind of thread for any industrial power. Today, China is the main importer of oil so they have to be friends with Iran in order for them to fill the tank of their own economy. But you have also the same kind of logic for France. We have a very dark history with our former colonies who had the chance – the luck and the bad luck – to have oil in the ground. In Algeria or Gabon, for instance, the French government made sure that we would remain the ultimate hegemon.
MA: So it’s the national oil company in Saudi Arabia. Its name used to be ARAMCO and it stands for Arabian American Oil Company. In the ’30s, right under the nose of the British, U.S. oil businessmen realize that Saudi Arabia had tremendous oil resources. And up until the ’80s, it remained a U.S. company. And that was the prime jewel of the U.S. oil empire. Why is that? Very simple, because Mother Nature happened to give the largest oil reserves to the Saudis. The Saudi king made this deal with Roosevelt. On the way back from the Yalta Conference in 1944, Roosevelt stopped along the Suez Canal to settle this historical deal which is usually summarized as “oil for security.”
But even after that, Saudi Arabia and Washington kept a very close relationship. For instance, al-Qaida is one of the direct results of this intimate and intricate and sometimes scary relationship. And up until today, most of the American presidents, when they arrive in the White House, their first trip is to go to Saudi Arabia. So that trivial fact gives you the reason why Saudi Arabia, a very remote desert, despotic country, is at the center of the policy of the most powerful nation in the world.
RF: One question that comes to mind is how central is understanding oil in understanding why the U.S. and Western allies have been fighting wars in this region for so long.
MA: My answer to this is very simple. If you want to remain in power, you need energy. That’s a basic fact. Right now with the whole shale oil boom in the U.S., this mindset is changing a little bit. People in the U.S. are saying, ‘we have oil now again, we no longer need to fight wars that nobody understands with a strange agenda of trying to remain at the top of the game around the Persian Gulf.’
“So we fought many wars for access to oil when oil was plentiful. You have to wonder what’s going to happen when oil becomes – and it will become – a scarce resource.”
But I would argue that this is not going to last because the thirst for oil all around the world remains and it remains very high in the U.S. It’s very hard to be certain that the shale oil that is booming right now is going to remain for this for several decades. The trouble is that oil is an exhaustible resource at some point. The faster you empty your glass, the faster it’s empty. Mad Max is not just a bad nightmare. It’s a reality for several countries in the world. When you look at Venezuela, its production is decreasing. When you look at China, not many people know that China is a very large oil producer. But it’s passed its so-called peak oil, and its production is declining. So we fought many wars for access to oil when oil was plentiful. You have to wonder what’s going to happen when oil becomes – and it will become – a scarce resource.
RF: I live in a region where there’s a lot of this unconventional oil and gas, mainly natural gas. You see these drilling rigs all over the place. I wonder how much the shale revolution has changed this paradigm. It sounds like you don’t think it’s changed all that much.
MA: That’s the big question. Conventional oil production, which brings to the market 3/4ths of the production, it has passed its historical peak production. It’s in decline. And you have many, many regions in the world that are in decline – Algeria, Venezuela, China, the North Sea. So you can look at the shale oil and gas phenomenon as a solution to this problem of conventional oil production decreasing for a geological reason. You can look at it as a solution or as a symptom. A century ago, the place of birth of the whole U.S. oil industry was Pennsylvania. That production peaked in the late 19th century and that oil has been exhausted for a long time.
And the source rock in which shale producers are tapping to exploit and produce shale oil is the actual source rock of the conventional oil that is now exhausted. So we have to remember that and zoom back on the proper historical scale. You have this boom that’s been going on for 10 years; is it going to last 10 more years? There are many doubts not only from environmentalists but observers of the industry like geologists who say that the shale oil boom is going to be on a plateau and level off as of next year.
RF: So there are these twin crises in this story. One is, of course, climate change. But another is this question of are we going to reach peak oil and be in a world where there’s less and less oil available for use. How do you see this playing out in the next few years or decades?
MA: I don’t do predictions. So the peak of conventional oil production was passed in 2008, according to the International in Energy Agency. The quantity of oil that we discover each year is less than the quantity of all that we consume. So it’s not rocket science to figure that this will have an end at some point and possibly an unpleasant ending if we are not cautious enough.
The most optimistic predictions, Exxon Mobile for instance, say that peak oil will probably happen in the 2040s. The less optimistic put the date during this decade. For instance, the International Energy Agency, which is very important in this discussion, says that we would need to triple the production of shale oil worldwide in order to compensate for the decline of conventional oil production. And if we don’t do that, we will have a “possible supply crunch” around the year 2025.
So when you have one of the most important sources of information regarding this issue saying that we are at the risk of facing a supply crunch worldwide in the year 2025, you need to be cautious. You needed to take that question seriously.