What I learnt about US Middle East policy and the international oil market in a kebab shop in Tooting

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Posted Jun 28 2015 by Dave Darby of Lowimpact.org
kebab

I learnt something about US foreign policy (or more accurately, corporate foreign policy – this has nothing to do with the American people) in a kebab shop in Tooting – or rather, I didn’t so much learn about the foreign policy as how events that are largely unknown to most British people are common currency for Muslims.

Skirting swiftly around the reason I was in a kebab shop in the first place (oh, OK – chips, salad and chilli sauce in pita bread – supporting a local small business, if you must know), this is how it panned out. I was standing at the counter – there were two Pakistani men behind the counter, and three Pakistani men on my side. There was a news programme on a large TV, and  I was the only one who didn’t understand what was being said, because it was in Urdu.

My attention drifted, but was caught again when I heard English being spoken. An American was being interviewed, with Urdu subitles. Here’s a summary of what he said:

“I was sent to Saudi Arabia in the early 1970s as part of a delegation to ‘do a deal’ with the House of Saud. The deal was this: make sure that you keep supplying oil to the US, and that you never, ever sell oil in anything but dollars, and we’ll make sure your oilfields are kept safe (i.e. we don’t blow them up).”

Now that got my interest. It was a classic protection racket deal, by the sound of it. I looked around me. All eyes were still on the screen. He said a lot more than this. For example, he said that another part of the deal was: all the money that you receive for your oil must be used to buy goods produced in the US, or to invest in US bonds. And in return, again, the corporate-controlled US military will resist the urge to blow your oilfields up. The Saudis agreed, and that was that – they had a deal. He was then sent to all other OPEC countries, with the same protection offer, and everyone agreed. Well they would, wouldn’t they?

The whole thing took a couple of minutes, and when I looked around, everyone was looking at me, with a sort of ‘well, what did you think of that?’ sort of expression (if you can imagine that). I asked if they all knew this already, and they said they did. I asked if this sort of thing was common on Urdu-language TV and they said it was. I said that I’d read about it, although not in any detail, and it wasn’t very common on mainstream British TV and they said they knew that as well. I left and walked down the street, eating my chips in amazement.

Why does the US need oil producers to only sell oil in dollars? Well, that’s an easy one. As long as the dollar is the international oil currency, everyone needs dollars to buy oil, so demand (and therefore the dollar’s value) remains high, which means that the US can easily hoover up all the world’s resources with a high-value dollar that everyone wants. This keeps your average American in a comfortable, bread-and-circuses lifestyle, with no thoughts of rocking the boat. Very important in the Land of the Free.

So has anyone broken ranks and offered oil in any other currency than the dollar? Only two – Saddam Hussein and Muammar Gaddafi – and I don’t need to tell you what happened to them. The big kerfuffle with Iran recently has been because they too have been talking about accepting euros or yuan for oil. They’ve gone further than that actually – they’re building a bricks and mortar oil bourse (exchange), to sell oil for a range of currencies. I remember reading something about it in the International Energy Bulletin years ago, which seems to have disappeared, but was reproduced here in Resilience (it occurs to me that the Energy Bulletin may have changed its name). They’re only trading petroleum derivatives, rather than oil at the moment. If pushed, I’d say that they won’t start trading oil until they have the protection of nuclear weapons – that being the reason that the US are so against that particular development. You can’t bomb a country with nuclear weapons after all, as Kim Jong-un knows.

I didn’t hear the name of the American in the film, but I’ve looked into it and I’m pretty sure it’s this guy. Here’s something about him by the great Greg Palast. And here’s a video of him saying similar things, although it wasn’t the one in the kebab shop.

This is all just so that you know about the real machinations of the corporate world behind the Disney-esque advertising. It’s not fair if the Muslim community know these things, but other people don’t. Actually, I carried out a poll of around 20 friends, including a couple of Muslims – all of them quite switched-on – and no-one had a clue about it. I’d have expected something like this to have been in the papers and on Newsnight, but I must have missed that (cue for someone to send me a link to show that this story actually has been covered by Newsnight, but I doubt it).

August, 2017

I’ve just been reminded about this article, and the fact that it comes across as a little flippant, so I’d just like to add a few things:

Of course, this is John Perkins, author of Confessions of an Economic Hit Man – the second edition came out in 2016.

What he wrote in the first edition has never been successfully refuted. Have a look at this ‘veracity memo’ put out by his publisher, Steve Piersanti. He has lots of support from respectable and influential people for what he’s saying – basically that oil-producing countries only use dollars to trade oil, and that’s down to what amounts to a classic protection racket, although the details of which will obviously be murky due to the secrecy of the negotiations.

Those attempting to refute his claims are exactly who you’d expect to – the NSA, the US State Dept, and his main critic is Sebastian Mallaby of the Council on Foreign Relations, a powerful corporate think-tank, which exists to ‘promote globalization, free trade, reducing financial regulations on transnational corporations, and economic consolidation into regional blocs such as NAFTA’ – so no surprise there.

As China and others grow in strength, America is going to struggle to keep the dollar as global reserve currency. This combined with the oil running out anyway, and the wobbliness of the global financial sector means that in all probability, the US is in trouble. The problem is, they have the weaponry to destroy the world, and they’ve always shown a willingness to invade. Very dangerous, and it needs new ways of looking at things. And the original article was written before we had Trump with a cabinet filled with Goldman Sachs people.