PROBLEM AND SOLUTION
By Dr. Hajime Fujiwara, international affairs commentator, and author of 20 books regarding international oil politics.
The Wrong Button
Pressing the initial wrong button can lead to unimaginable turmoil. On the surface looking at Saddam Hussein's invasion and annexation of Kuwait along with the reaction of the United States and the rest of the world may be a classic example. Wrong buttons were pushed on both sides. Only by looking deeper into the circumstances can we avoid making some dangerous emotional decisions.
With a world wide embargo on Iraq's economy, nearly a million people fleeing the country to escape the ravages of war. a massive mounting of military presence in the Mid-East, and a pervasive fear that war will break out, there is no wonder that there is an explosive rise in oil prices. The result is sending huge shock waves throughout the world economy.
The conspicuous movements of Iraqi armored divisions and the bold American military moves are astonishing spectacles. But equally astounding was the rare unity of the United Nations' members in agreeing to cooperate on the Iraqi embargo. And then the United States and the Soviet Union working together was yet another surprising but welcome sight. But this unity between two great world powers was not triggered by the Iraqi aggression.
The Iraqi reasons for using military force to discipline Kuwait does have significant historical precedence in the Mid-East as a solution to territorial disputes and the taking of oil wells. Stealing the Kuwait gold from their central bank and stealing many other kinds of property are examples of the nomadic Arab belief in a brute force solution. And some of the wrong buttons were pushed in this area.
But one of the most important overlooked factors is that before any military action was taken by Iraq, they issued a complaint to Kuwait about their stealing oil from the Rumaila oil field which is locate partly in both countries. Kuwait's response was only excuses and refusal to address the matter seriously. Then Kuwait followed this up with a demand for repayment of their $20 billion dollar loan to help Iraq finance its war with Iran. The first major wrong button was certainty pushed here.
The Rumaila oil field extends from Basra, Iraq's second largest city. south across their border into Kuwait. Rumaila, the fifth largest known single reserve of oil in the world, was developed by Iraqi bartering with the Soviets and through technology offer by the French. The Soviets bartered armaments for Iraqi crude oil which the Soviets sold for cash to buy such survival necessities as U.S. grain.
Being the most productive oil field in Iraq, the Rumaila field was a great hope for cash from future oil exports in order to fund their dreams of modernization with new foreign machinery. This oil field represented their path to economic independence. But during the Iran-Iraq war, repeated military action in the Basra threatened damage to their production facilities. Iraq finally laid land mines to protect their valuable asset.
Then Iraq completely shut in the Rumaila oil production for six years. At this same time on the much smaller southern end of the Rumaila oil field, Kuwait drilled more than 40 wells and continued produce and sell the oil. And all the while Iraq was concentrating on its Iranian war efforts which were supported by Kuwait and other Arab countries.
Oil is a liquid that moves under pressure and disregards all man made boundaries. As oil production increases, the gas in a field escapes and the initial pressure is lost. And the oil field reserves are also depleted.
When Iraq resumed production in the Rumaila oil field after their war, they discovered this lost pressure reserve depletion and they lodged a formal complaint with the Kuwait government. Iraq estimated their oil depletion losses at $2.4 billion. In addition, because Kuwait and United Arab Emirates pumped more oil than their OPEC quota, this drove down the oil price costing Iraq an additional $14 billion. Iraq demanded compensation. Iraq's final demand on August 1 was then refused by Kuwait on the same day, which was the day before Iraq invaded Kuwait.
So Kuwait's refusal of Hussein's demands along with Kuwait's counter demand of repayment of their war loan to Iraq were key events immediately preceding Iraq's invasion of Kuwait. Hussein gave the order to attack and his armored divisions swiftly crossed the border and pushed immediately toward Kuwait City with little resistance. Iraq seized complete control. More wrong buttons were pushed.
But the Saudi Arabian military made no preparations to fight even though powerful Iraqi armored divisions on the day of invasion, August 2, could have easily plunged 200 miles further south into Saudi to Dhahran and captured the pipelines and pumping stations which are the heart of the Saudi oil production. However the Iraqi army stopped short of the Saudi border, deployed its tanks, and gave no indication of an invasion. The only real panic was in the Saudi royal family who were afraid that the Iraqi would destroy their kingdom.
Meanwhile, President Bush recalling the Nazi blitzkrieg, compared Hussein to Hitler, and not about to follow in Chamberlain's or Daladier's footsteps of appeasement, elected military force. He pulled out his Pentagon file titled, "Middle East Military Contingency Initiative," and put this plan into immediate action by ordering a massive military build up in Saudi Arabia. Another wrong button was pushed.
Washington's official announcement of the U.S. military deployment to Saudi Arabia came on August 8, But Bush had already Secretary of Defense Cheney to Riyadh to meet with King Fahd on August 6. When the first Marines were air lifted on August 7, Washington could then say this action was taken in response to the Saudi request to defend their country.
The proposed possibility of an Iraqi invasion of Saudi Arabia then became the provocation for the American decision. Hussein, fearing destruction, countered with a plan to use hostages as "human shields" for protection. This was followed by the U.S. "Desert Shield" operation which escalated the build-up day by day. More buttons were pressed. No one could see any of the right buttons to push
The American military build-up grew steadily to the point where they could attack at any time. A strategic night attack was another possibility if the use of hostages as a shield had not been a factor. Hussein vowed to use the hostage shield and promised to retaliate by attacking Saudi oil fields if the U.S. took the first military action.
Oil production and transportation facilities are extremely vulnerable to attack and can be easily destroyed. And it takes a long time to repair them. If the power station and plumping station at Dhahran, or the Saudi computer control centers, pipe line terminals were attacked, Saudi oil would undoubtedly stop flowing for at least a year. This would wreck havoc on an already precarious world economy.
The Saudi coastal area around Ras At-Tannurah boasts the world's largest terminal capable of handling eighteen tankers at one time and responsible for 80% of all Saudi oil shipped, is their most inviting target. Also nearby are the oil refineries and vast storage tanks for petroleum products. The possibility of missile retaliation on this area is extremely high.
But the real heart of the problem is not the defense, but how to keep from cornering Iraq into a situation of total desperation with no possibility of a solution allowing both sides to save face. Both Saudi Arabia and Iraq have sophisticated attack weapons of destruction. Triggering the madness of a Kamikaze-like attack by Iraq, the strongest military force in the gulf, would be a disaster because the fate of mankind would be in danger. The mouse could bite the cat. We cannot afford to push any more wrong buttons. We must reset the buttons and look for a way to start over.
The specific issues of the Rumaila oil field must be placed squarely on top of the table. This is what Saddam Hussein requested and what Kuwait refused to discuss. The U.S. has the best expertise to solve oil drilling and production disputes. The Texas Railroad Commission and the Kansas Corporation Commission are two of the world's best systems from oil producing states which arbitrate and control disputes. U.S. oilmen know that developing regulatory organizations is a much better solution than force at the end of a gun.
Bush had ties to the Texas oil industry and was formerly president of a drilling company. He has been exposed to resolution of these oil disputes. And Hussein is looking for a solution of a serious oil dispute. This just may be the door to a peaceful solution. But frustrating Hussein by an escalating military containment is a button which could give us a disastrous result,
Bush's problems of upcoming fall elections and the budget issue all playing important parts in hitting the wrong buttons, like the Pentagon plan. Why don't we put our strong feelings aside and shake hands? Two armies trying to stare each other down in a hot desert isn't a solution. This could generate more problems than we can now imagine. World history gives us insight to wars over oil and there are no winners. Fighting over oil is not a positive direction for the future of mankind. The next generation would be best served by focusing our energy on conserving our dwindling oil reserves and by seeking peaceful solutions
English translation of KASHU MAINICHI (The California Daily News) On September 28th and October 1st 1990.