[GegenStandpunkt Index]

On the political economy of oil

A Strategic Good and its Price

[translated from GegenStandpunkt: Politische Vierteljahreszeitschrift 1–01, Gegenstandpunkt Verlag, Munich]

"The euro zone is well-prepared for coping with the new oil price crisis thanks to its stability policy and the strengthened economy. However, the European Central Bank admonishes wage demands to stay moderate and fiscal policy to stay sound." (Handelsblatt, Dusseldorf, Nov.10, 2000)

At last, even a soaring oil price provides an argument for pushing down wages: the more expensive petroleum becomes, the cheaper labor must become. Small wonder. In capitalism, everything leads to this conclusion. Yet there's apparently even more that depends on the price of oil. Its increase is labeled a "crisis," constitutes an "endurance test" for the euro zone's economy, endangers its economic upturn, threatens America's "economy and security" and the world economy as a whole, and "derails the planned debt forgiveness for Third World countries" (which is known to be a matter dear to the heart of global capitalism) — all a bit much of an effect for the price of exactly one commodity. Is the entire capitalistic mode of production — which has captured the whole world by its effectiveness and the outstanding qualities of its human rights in combination with its noblest endeavors to combat poverty — really to run into trouble merely because a barrel of crude oil costs thirty instead of fifteen dollars?

Hysterical journalists are not the only ones to see it that way. The highest authorities of the states organized along the lines of a market economy are personally worried. When they assembled in Prague as the G7 in year 2000, they decided on common "measures" for lowering oil prices, although they themselves are hardly oil traders. They are rather the most powerful advocates of free markets, deregulation and unhindered competition as principles for every economically reasonable and socially just determination of prices anywhere in the world. Moreover, their "measures" are not even aimed against those measures by which they really contribute (and how!) to increasing current oil prices. In this matter, on the contrary, despite and especially in view of soaring crude oil prices, they insist on taking an action that is otherwise reserved for consumer goods which are injurious to one's health: cutting down on consumption by administratively raising the end product's price. This doesn't prevent them in any way from reproaching the oil companies for pursuing a price policy that more or less applies the complementary method: cutting down on supply in order to raise the price of the raw material, a policy they have been empowered to pursue by the selfsame authorities. Thus the politicians, masters of the gasoline tax, stand up against artificial price increases of crude oil, against conglomerates that compete for capital turnover and market share by cutting down on the supply of the commodity; and they do this in order to cut back oil consumption by governmental price policy. Is this the way a market economy works in the energy sector?

Not at all, because that's not yet all there is to it. The "measures" through which the G7 wants to do its bit towards lowering the price of oil consist in urging the oil-producing countries to extract more, deliver more quickly, and ask less for their product, i.e., to squander their resources and do without national revenue. These admonitions publicly accompany the unpublicized extortion against each of these states and against OPEC, their "leaky" oil cartel. This then, is the "world trade for the benefit of all participants" that was declared to be the supranational world constitution by the seven most important "industrial nations." What is more, these states incidentally are responsible for its implementation, not only, but primarily in matters of a worldwide oil market. They do so in their capacity as a strategic alliance and with their declared will, if they deem it necessary, to intervene at every oil well and supply route whatsoever with all necessary military means.

So, when it comes to petroleum we are not talking about just any kind of business nor just any commodity. This is shown in its price (how else indeed in the global market economy), to wit: in the enormous influence the price has; in the importance of the economic subjects who have to put up with it; in the prominent authorities who worry about it; in its realization, in which the same political authorities and economic subjects once again play a crucial role; in the way it is dealt with by traders and consumers, oil consortia and oil-producing countries, and once again by the big capitalistic powers of the world economy. It is obvious that this price is something rather more decisive than merely the amount of money at which supply and demand just happen to cross. Moreover, on the market where it is determined, there's something else at stake than just purchases and sales — more like an entire branch of imperialism today.

1. Oil — a strategic good

a) Artificially produced energy is the crucial source of motive power for the entire material process of life in a modern society. It cannot be replaced by anything else and has to be continually and uninterruptedly provided because it is constantly consumed. Its price directly or indirectly enters into all the accounts of a capitalistic economy. This price substantially determines, although not by itself, the amount of capital — namely that part of it needed to be continually raised — that is required for the simple or extended reproduction of the wealth of society. Its increase can intensify the capitalists' competition, as is known from crises. Thus the indispensability of this use-value[note 1] for money- and profit-making is affirmed in the cost for energy — and vice versa: a continuous and sufficient supply of this particular economic good in the midst of capitalism is vital, i.e., the fact that the wealth of society is dependent on the industrial provision of energy makes itself felt as an especially crucial matter of price in the hustle and bustle of capitalism, and accounts for an unconditional demand that energy costs, if unavoidable, be reliably low. The reliable and cheap provision of energy is a vital interest of capitalistic societies.

Ecologists can draw up an "energy account" for every product — and are right in doing so in a way they probably do not even see themselves, for production is the expedient use of energy. And for a long time now, the latter has not been obtained by the physical effort of producers. No production process can be carried out any more by human exertion alone. The same applies to the transport of commodities and human beings, as well as to a bearable room temperature in various climatic zones. Nor does anything that — according to modern nomenclature — comes under the category of "services" function without the artificially obtained arithmetic product of mass times velocity squared. This economic good is indispensable and cannot be substituted; it is required always and everywhere, consumed by its use, and therefore has to be continually reproduced. Its provision is the objective requirement as such for the entire material process of life — of societies which, however, deal with this process in accordance with accounting rules entirely different from ecological ones. The actually decisive balance sheets, i.e., the profit and loss accounts of capitalistic companies and the "overall economic account" of the ideal collective capitalist (the state) as housekeeper of its society, present energy as a decisive item of expenditure, due to its ubiquitous use.

b) Due to its natural qualities, petroleum is the ideal raw material for a capitalistic economy's energy demand. Secure, free access to it is therefore of vital importance for the state powers in charge. As things stand, since they have on their own territories almost no oil wells that can provide sufficient supplies over the long term, they have to make sure that there is a cooperative foreign power in charge of the foreign oil deposits. This is no modest demand on their ability to exert political influence throughout the world.

Petroleum is available in huge amounts in many places, and at production costs that — all in all — lie well below the expenditure for exploiting other energy sources, for instance coal. And it doesn't take much effort to make it ready for any conceivable use; rather, it is a windfall among all of the energy sources which have been discovered and developed up to now for satisfying capitalistic demand. Yet, the object of desire generally lies outside those national borders which define a capital-site, i.e., a territory for capitalistic growth, whose optimal source of motive power is this same petroleum. Even in the exceptional case of the United States, which really got the accumulation of capital going on the basis of petroleum, consumption has long since exceeded national extraction, and demand is focussed on oil wells outside the national territory.[note 2] Secured access to this ideal raw material for procuring energy by those who need it is consequently an international affair.

In this matter, roles are clearly allotted. Those state powers that are in charge of a territory with the liveliest accumulation of capital know their wealth — and thus themselves with all their power — to be dependent on a reliable oil supply, and this they can bear only if they themselves have the conditions of supply under control. They therefore insist on a foreign management of power in the oil-extracting countries which, on the one hand, has its territory under control, while on the other hand, subordinating itself to the control of its powerful partners. Where oil transportation affects neighbors, the same goes for the neighbors' leadership. The chosen means to enforce this double demand are weapons; equipment is delivered which enables the foreign rulers to remain in power unchallenged, and which, at the same time, places them under a quasi-objective obligation to their partners who have equipped them in such a way. Where, however, nation-states are so run-down that they are not even capable of such an expedient use of force, or where rulers appear to be too unreliable to the great powers as to entrust them with war material, unofficial private or mercenary armies in the service of the engaged oil companies occasionally take care of "security" at the oil deposits. In no way do the great advocates of a peaceful world order thus spare themselves the "projection" of their own military power; the equipping of foreign rulers is accordingly supplemented by the continual development of their own capabilities and their incessant preparedness to force — if need be — their sovereign partners to cooperate against their will. The security of transport routes cannot be left up to the oil-producing partners or to just any third party. So deposits and transport routes for petroleum are crucial objects of the worldwide military involvement of capitalistic powers; the strategic view of the world taken by democratic rulers is quite fundamentally orientated towards these objects.

c) The great "consumer countries" bring their political and military power into action in order to establish and secure a world market for petroleum where capitalistic companies are active according to their calculations on profitability. The methods of commerce, i.e., profit-orientated buying and selling, are meant to guarantee stability and reliability of supply at the most economical price. The supplying countries have in this connection been allotted the role of sovereign landowners who live on the proceeds granted to them for their mineral resources.

The great oil-consuming countries do not refrain from using force against the "oil countries." Their threat of war is universal; if that deterrence fails in its effect, their oil supply is definitely worth waging a war for. And yet nowadays, they do not pursue an aim as narrow as capturing oil fields; armed occupation occurs if need be only in an auxiliary capacity, to ward off disturbances. By contrast, the aim of all the coercive relations they initiate is the establishment of a worldwide market where petroleum is traded as a regular business item. It is now perfectly clear that this trade is consequently anything other than a simple exchange of commodities, which could proceed in a free and easy manner because it is to everyone's advantage. (The same holds for the competitive arrangement known as the "world market," by the way.) For this trade to function as desired, the great "consumer countries" are not only present as buyers on the world oil market, but as strategic powers in control. All the same, they consider it to be a fantastic civil achievement greatly to their credit that they have organized their unconditional access to oil resources exclusively by means of the market, even though it is so indispensable to them that it must be secured at all times by every means of force.[note 3] With all the force at their command, they guarantee that their oil supply is channeled into free-market commerce — commodity for money, money for commodity, so as to make more money on it — and is dealt with according to market criteria. Because in this way, and only in this way, do they suppose they can certainly, continually, permanently, and economically, i.e., in an entirely businesslike manner, be supplied with their chief means of existence in regard to energy.

The crucial point in all this is to get those who rule over foreign oil deposits properly in line. That is why the deployment of a considerable strategic threat is aimed at these rulers. They have to become reliable contracting parties, who accept foreign access to their mineral resources in the businesslike form of payment as the way to participate in the world market, and who base their economic existence upon this business. They are assigned the status of landlords who figure economically as real estate owners. This takes place because, and insofar as, they are in control of their territory as political sovereigns, and are thus entitled to a share in the proceeds from the sales of their commodities which foreign interested parties and entrepreneurs extract from their soil, or rather purchase from them as their "mineral resources." These landlords need not and are not supposed to live off their own people and their domestic economy in the manner of any other respectable bourgeois sovereign. Instead, they are paid from abroad with a kind of absolute ground-rent to which a private landowner within a capitalistic class society is entitled if he entrusts his land to a commercial user, a leaseholder. The basis for this kind of ground-rent for oil-producing countries is not, however, the private economic relationship between the class of capitalists and landowners in which legally secured property gives landowners the right and the power to collect tribute from others for the use of a piece of the earth's surface they monopolize. In the present case, nation-states in need of oil, which they intend to make available for themselves, appoint foreign sovereigns as landed proprietors of a special kind for this purpose; this political relationship is the basis for the payment in the manorial style. That is why the capitalistic powers interested in petroleum are the masters of this relation of a political ground-rent — as opposed to the usual commercial relationship between landowner and tenant. The oil-owning countries are instructed in their politico-economic status and monitored as to whether they comply with the rules of the free world market. Generously, the originators and supervisors of the world market also allow their suppliers to make something of a profit from the use that the their capitalistic national economies make of foreign oil deposits: they grant them, i.e., their suppliers,political revenue. In doing so, they even allow the clients they themselves created, as the acknowledged sovereigns over oil-containing territory, to attempt to dispute over the amount of their revenue. Apart from the outcome, one thing is certain: a nation-state that haggles over the amount of its maintenance from abroad has accepted the role the capitalistic powers earmarked for it, namely as the opposite party on the world oil market; it has in principle accepted its politico-economic destiny to offer its own mineral resources for sale and thus to make them available to foreign interests. It is this service for which the oil-producing countries are reimbursed with their share in the profit on oil. This compensation enters the oil price as its first integral component. Conversely, in this first component, the oil price captures the nice success that foreign rulers subordinate themselves to, so as to function as foreign correspondents of the global oil business, as sovereigns enthroned over their oil wells; a business arising not there, but in the great capital-sites. A piece of an imperialistic order becomes a quantity in the calculations that the political directors of the world oil market leave up to the competent managers of capitalistic business life. The latter see to it that they come away on the cheap, and can now give their undivided attention to the calculation of production costs that incur in procuring and processing their raw material.

Thus this much is certain in respect to oil and its price: it is all about an elementary matter of price and supply — or, to put it another way, a matter of supply and therefore of price — in a market economy where accumulating money is the purpose and which is to this end successfully run by the decisive members of the community of states. In order to settle this matter to their satisfaction, these powers demand and obtain access to the world's oil resources, strategically secure them by superior force, organize them as a global business and install the "oil countries" in their fitting function as selfishly engaged henchmen. That these rulers accept their status as recipients of something like political ground-rent and that the matter is to this extent reliably settled, is the first thing that is paid for by the oil price. It fixes a crucial piece of imperialistic power of disposal in the objective form of a commodity-money relation.

2. Oil — an exquisite item of trade

a) The world oil market is — as desired, implemented, and protected by the decisive countries — the field of action of big capital investment funds which act as the commercial agents of a vital interest of the most powerful nation-states. To the supplying countries, they represent, by the material force of their assets, the capitalistic national economies' energy demand. Apart from the money for satisfying the property rights of foreign sovereigns to mineral resources, they bring whatever is needed for extracting and removing the same. In return for this, they demand access rights, if possible exclusive ones, to the oil deposits in the respective countries. For the other side, they take up their task of providing a secure and cheap energy supply, a task which has fallen to them together with the license to make profit on the general demand for energy. And this in the only adequate manner: they set up a complete energy industry on the solvent capital-sites, i.e., on those territories where demand appears in the form of means of payment, and thereby compete for domination of the national energy markets.

In all the nations with a capitalistic production and accumulation, the supplying of energy is in the meantime taking place as a capitalistic business. Governmental energy management is at most allowed for states of emergency; the decisive states have even forbidden such "interventions" in normal times. And yet, until recently, the engagement of states in the energy business had not been some "socialistic" violation of the human right of doing business; instead it was expedient and necessary in order to actually secure an amount of capital on the scale required for worldwide business activity in the energy, and especially oil sector.

The companies that were the first ones big enough to carry on cross-border business with oil had for a long time, as multinationals, the bad reputation of concentrating excessive power in themselves and, on top of that, without democratic legitimacy and control; and of exploiting entire states on the one hand, the consumers in "industrialized" nations on the other hand, by extortionate methods. Much of this accusation has been dropped — without the circumstances having changed — because public opinion has changed somewhat in the meantime. It has — under the label "globalization" — agreed on taking the imagined threat by worldwide business activities against both the autonomy of nation-states and the man on the street to be a general phenomenon, more a challenge for modern statesmanship than a danger to it. However, neither in respect to the old nor the new version is the assumption correct that "globalized" business, and especially that of the oil consortia, were ever a matter of an "uncontrolled" concentration of power beyond any governmental responsibility and contrary to the virtue of democratic self-determination in a liberal community. These conglomerates are licensed by the great democratic powers. They have all attained their size through strong governmental help, which has actually empowered them to their particular, per se multinational business — the American companies earlier, the European ones later. And this kind of business simply cannot be run without the deployment of lots of might; namely, without the control of supplies and markets being concentrated in the concerns' head offices. After all, what is at stake is the program to fulfill the crucially important task of supplying, not just anyone, but the most ambitious capital-sites in the world by dealing with this service in a businesslike manner, that is, by making massive profits. The conglomerates are permitted and supposed to act with extortionate negotiating power when procuring oil, and when supplying oil to turn the energy demand of the entire society into a vehicle for their profit. Because — according to the decisive judgement of the decisive powers — this, and only this, is the optimal guarantee for a reliable and economical energy supply. The multinationals are only acting logically and entirely in accordance with this obliging permission when competing for the domination of both sides of the energy market.

b) The multinationals' fight to monopolize the energy business furnishes the second crucial component determining the level of the oil price. Their competition makes the price fluctuate around the calculated supply costs for the quota produced at the comparatively highest cost that still allows for profitable sales to solvent demand. The price movements thus created are the basis for a tireless speculation on conjectured interim levels. In accordance with its own circular logic, this speculation sets the barrel price for crude oil quoted at the exchange day in and day out.

The times are over when the seven biggest American companies could dictate the American domestic price and get the whole world to agree to it as the basis of calculation for the price of crude oil. Today, a still relatively low number of multinational concerns, as well as a multitude of smaller companies (which are often only active at intermediate stages of the oil business and which were not infrequently founded by the oil producing countries themselves) compete against each other at and for a delivery price not coincidentally estimated in a way similar to the differential rent explained by Karl Marx.[note 5] In this form of rent, naturally advantageous soil conditions pay off for landowners in the agricultural industry. This is so because the price of agricultural produce tends to follow the cost price of those goods that are produced under the most unfavorable conditions, yet are still in demand and paid for accordingly, thus causing a surplus profit that landowners are able to claim for produce produced under more favorable conditions. Following the same pattern, lucrative advantages may accrue to any capitalistic business of any kind because of the particular suitability of the plot of land where it is carried out in comparison to other plots or sites: special profits which are ascribed to the property and justly accrue to the owner in accordance with the free market way of accounting. When calculating their prices, oil traders in a similar way take into account the production costs at which they are able to supply the self-created demand for their stuff. That is to say, they take, not the average of their prices, which — depending on their capital expenditure and deployment of the workforce necessary for drilling and transportation — may vary widely. Rather, they take the highest individual procuring price at which, according to their calculation, the existing purchasing power would completely be absorbed. This price varies, of course, due to the business cycles of the capitalistic world economy and thus of its energy requirements. Accordingly, oil quotas produced at various costs come on the market. Even apart from the fluctuations of demand, the exploitation of old fields and the tapping of new fields influences the procurement costs of the last oil quantity that can profitably be sold. Whatever the case may be, the more cheaply produced quantities of oil generate surplus profit. This surplus profit, however, by no means simply goes to the "oil-producing" countries in the form of a real differential rent such as a landowner can demand from his tenant within capitalistic class relations. In the relation between the powerful "consumer countries," as whose commercial agents the multinationals with their business interests act, and the rulers of oil-containing areas, the right of property is also valid — in principle; this is exactly what the decisive world powers insist on. Yet in contrast to capitalism at home, nothing further is conceded with this right, especially not any entitlement to the distribution of proceeds based on the model of lease relations within a capitalistically producing nation. The oil-extracting countries' oil property is actually (i.e., in money) only worth as much as the other side, which grants them their property right, allows it to be. They have to fight for their share if they want to get anything out of the capitalistically calculated final price that covers the highest production costs for crude oil. Whether they get anything at all, and if so, how much, is formally a matter of negotiation, whose content, however, makes it a permanent fight over distribution. There, one side tries to use its sovereign power over its oil wells, and the other side uses both the market power it has due to the amount of capital it possesses and the governmental support of the nation-states in whose vital interest it is to concede as little money as possible to national landowners. The goal of the supplying countries is to achieve a delivery price that is as high as possible or at least within the range of the respectively highest profitably realized production costs. In this case they themselves would indeed collect the entire "differential rent" springing from the favorable geological conditions occurring in their respective countries. The goal of the oil companies' negotiations is to appropriate the entire surplus profit. Whatever the result of this fight,[note 6] it remains the multinationals' business to push through a price on "the markets" which pays off for them. This price then is one for which they have at least set, with their highest production costs, the standard for the saleable quantity of oil, whereas the oil countries' delivery prices are at any rate below this level. The oil price is made to fluctuate by the oil companies' inner competition around a corresponding demand that, itself, broadly varies depending on the conditions of production and the prevailing economic trend.

"Volatile" is the term for the result of such price formation. And this quality of the oil price causes all the businessmen who have to pay it, being an item of expenditure they simply cannot do without, to have a strong interest in long-term assurance against unforeseen fluctuations. Because in a market economy, all honest needs of capitalists are served, this interest at once finds financial capitalists putting out offers to take over any price risk for a small fee, for example by selling oil at a certain forward price, so that at least a fixed magnitude can be relied on. Such insurance activities are quite in the national interest for an energy price that reliably indicates for the long term, to some degree, what the nation has to spend for transportation, heating, and above all, to fuel its economic growth. So finance capital is given free rein to engage in speculation, which, after all, is the unavoidable other side of the insurance business. And since speculation creates as many new risks as it insures, and thus inevitably becomes an object of new speculative business activities, quite a number of derived contracts are built up on the trade with real oil — a source of enrichment, and a real one at that, for the "derivatives" branch of the credit superstructure of modern capitalism. The agents of this business take note of the few objective causes determining the oil price (add to the ones mentioned above the results of the politico-economic management of the energy sector, which is dealt with in the next section) as a set of influencing variables, in addition to the many other variables they know about. Among these other variables are not least those tendencies of price movements they themselves have anticipated and thus brought about. These, of all factors, even appear to them to be the most important ones. And, because they not only theoretically turn things upside down but invest lots of money in order to be confirmed, the speculative geniuses turn the oil price together with the energy business dependent on it into an appendage of their own business. They do not, however, entirely succeed in making the objective, logical sequence, which exists between their speculation and the material they speculate on, disappear; what they actually determine in the end is not the oil price after all, but merely its perpetual fluctuation. This difference is, however, of absolute indifference to them. They and the rest of the responsible business world are quite certain that the oil price consists merely in its fluctuation. Indeed, one of their points cannot be disputed: day in and day out, or even from one hour to the next, a globally valid standard price of a barrel of oil emerges, in which actually everything, from a recent war and the latest tanker accident to the American President's bad mood is justly and appropriately mirrored, that is their doing — and, as a consequence, this price is even more violently unstable than anything the oil companies would have brought about on their own as "volatile" results of their competition. That is the just reward for having let finance capitalists insure their colleagues against the risks to the profit rate. In the end, the risk for the business world and the nation is even much greater than before. But, in return, it is always known how much oil cost just a minute ago.

c) Throughout the world, the oil price is expressed in U.S. dollars. Ever since American businessmen honored petroleum as the ideal source of motive power for capitalistic growth and got the whole world to agree to this, and after a world war and a cold war unleashed American imperialism, the world economy's most important material means of existence is inseparably connected with this most important means of access to world business. At least for the time being.

Large-scale business in petroleum originated in America. The entrepreneurs engaged in this business had good reasons to use nothing but their traditional means of doing business for their activities that were soon to be global. The newly emerging "oil countries" had all the more reason to accept this money. The economic and strategic power relations in the world of nations secured the ubiquitous, unchallenged validity of the American currency. For the oil companies, it therefore was the only form of money that lived up to the requirements of their worldwide engagement. With the dollar, the "oil countries" got their hands on the means necessary for their entry into the world economy, for which their own currency had not at all been suitable.

To date, the U.S. dollar has not lost the status of "oil currency," and for the same good reasons. This sort of money, even in comparison to the few competing world currencies, is still the best guarantee for having universally used and usable credit at one's disposal — not least thanks to the mass of "petrodollars" circulating outside the United States that have helped to stabilize the pre-eminence of the American currency. This continues to be a decisive argument for a branch of business that procures its commodities everywhere, sends them everywhere, and makes profit on the course of business everywhere; and it remains just as convincing for the supplier countries because their own local currencies, as opposed to the dollar, are still not unrestrictedly viable as a means of buying and doing business. What is more, the might attesting to this world money still answers for the strategic security required for the global oil market. The ways of the world — those directed by America at that — remind all those involved once more of this elementary condition for doing business in petroleum in compliance with imperialistic requirements. And what could speak more clearly in favor of a means of business than that it originates from the same "source" as does the might on which the course of business is based. This is by all means more crucial for the various participants in the oil trade, be they big or small, private or state-owned companies, than all the fluctuations of the dollar rate in comparison to other currencies.

From the standpoint of imperialistic competitors, the matter is, however, viewed a bit differently. And for the rest of the nation-states in need of the American currency to cover their oil requirements, yet lacking it, this is indeed harsh. However, this does not cause any multinational to show leniency.

The civil practices of the oil business, whose traders sport no national colors, teach this much in respect to oil and its price: in the same way as the great capitalistic powers do everything required to arrange the world as — along with everything else — an oil market, capital itself — licensed, encouraged and protected in this manner — does not give up until it has really unmistakably imprinted this determination upon the world. It squeezes the globe for all the energy resources with which business can be made, and does this in such a way that it and no one else profits from it. On the other hand, where capital acts as an energy supplier, it does everything in its power to put the working (as well as the inseparable private) life of mankind into the service of its special business interests, exploiting the use of energy for profit. All this enters into the oil price as an objective law of calculating costs, and is put thereby into the trivial form: x dollars for y barrels of oil. That these are dollars, that capital invested in the oil business falls into the most intimate symbiosis with the domineering strategic world power; this is the appropriate thanks for its political authorization to everything it does on and to the planet.

3. Oil — a political object of "consumer countries"

The supply of oil, as well as its price, drives national economies and influences their business cycles. State powers that have command over capital-sites therefore relate oil to the achievements they expect from their economy. From this, they derive a broad catalogue of policy tasks. In carrying them out they furnish the third determining component of the price of oil.

a) Capitalistic nation-states have, with their energy policy, given the oil business all possible freedom. In the interest of increasing growth rates, they have converted and tailored their national economy to oil imports by doing without the ideals of economic self-sufficiency held in earlier times. Necessarily, they have allowed and organized the bankruptcy of domestic energy industries that were no longer competitive. On this basis, they pursue a program of developing new sorts and sources of energy, turning the industrial exploitation of these sources into a competitive growth industry. Recently, the virtue of economizing has additionally come into its own, just so long as it serves the profitability of capital investments in the nation by lowering their energy bill.

All leading capitalistic powers count petroleum as the most important energy raw material, simply because it is incomparably cheap and boosts their economy's growth enormously. They are confirmed in this by the gigantic economic success of the oil industry. In turn, the interests of the oil business are given unlimited rights by the authorities presiding over the common good. Besides this, however, the authorities are aware of other interests and points of view concerning the general welfare of capitalism that are affected by their fundamental decisions about energy policy, and have therefore to be defined anew.

First of all, they are concerned about their domestic economy's dependency on imports which they have brought upon themselves. After all, the authorities have let the sovereign disposal over the indispensable means of existence of their national economy out of their hands; and irrevocably at that, once the oil industry has made itself at home, adapted the energy supply system to their products and driven the consumption of fossil fuels to unforeseen heights. This, however, does not free state power of its responsibility for the national economy. It sees itself confronted by the unavoidable task of securing supply lines, in which the most important mission is to get control of the imports all the way down to their country of origin, and thus to keep under its control imperialistically that which is no longer within the boundaries of its sovereign authority.[note 7] In addition to this, it draws still further conclusions. It feels challenged in its efforts — which are on the politico-economic agenda of any leading capitalistic power anyway — to promote "innovative" technologies for generating energy and new growth industries based on them. Even if these for their part are dependent on imports — as is the case with Germany's nuclear industry, for example — diversifying energy resources at any rate helps to relativize one dependency by another. The question of energy independence, however, is in no way the only, or even the decisive, criterion for an up-to-date policy of government subsidies in the energy sector. Most importantly, the subsidies must pay off economically, at best doubly and triply; namely, as contributions to a further reduction of energy costs, as an accordingly promising new growth industry, and — this follows somewhat by itself — as an export success certifying the nation's leading role in the world economy. From the same point of view, in many countries the remnants of a former domestic energy industry have been liquidated. Anything that cannot be run profitably against the competitive pressure of petroleum is no longer worth the subsidies. For example, the coal mining industry in Europe had been made continuously profitable for decades by subsidies, and yet, since even then it could not compete with the price of oil, the subsidies were eliminated in a "socially acceptable" way. What is drastically revealed in this example, where an entire industry thus has become a welfare case, is the decisiveness by which the state powers in charge have set their energy policy priorities.

Energy-saving measures have never been part of these priorities. On the contrary, all competing world economic powers have organized capitalistic growth on their capital-sites along the lines of cheap energy, and that in a big way. Cheap energy has had its effects as a growth-promoting means by spurring on the development and deployment of labor-saving (i.e., job eliminating) machinery; it has "revolutionized" the entire sphere of circulation, a few effects in transport and communication being clearly visible to everyone. The capitalistic interest in cutting down on regular expenses — to which energy as well as wages belong — by one-time investments, in this case in energy-efficient machinery, has of course also always been served; of course within the framework of what seems profitable with cheap energy prices. Saving energy in this context has always been considered by the governments in charge as reasonable and supportable without harming the business of energy concerns. This movement has been expanding without interruption, even in the age of "thinking ecologically."

For that reason, standards have been shifted a bit in the meantime — at any rate for far-sighted energy policymakers, i.e., for those politicians overseeing energy policy. Exploding retail figures and, from time to time, soaring prices, plus, in all countries except for the United States, the hardly predictable fluctuations of the dollar's exchange rate, have made the oil import item in the trade balance of the big "consumer countries" into a critical or, at any rate, very critically viewed quantity. This first-class aid to growth is not questioned, but, in a more or less complementary manner, scrutinized as to how far its import could become a burden to the nation in comparison to its competitors. Just because petroleum is meant to remain as the energy source for competitive capitalistic growth within the national territory, and because a return to a policy in favor of a self-sufficient energy supply is absolutely out of the question, forward-looking governments feel challenged to keep oil import payments under control. In this regard they consider insisting on energy-saving measures for national oil consumption as well — e.g., on demanding and supporting the development of increasingly fuel-efficient cars, and in general on encouraging new technologies that promote energy conservation. This criterion of a changed energy policy is popularly introduced nowadays by reproaching former phases of growth as having been wasteful of energy. A past is referred to in which the cheap raw material had sweeping effects as an instrument for increasing profit rates and the rate of national accumulation on the whole, and had definitely boosted the competitiveness of capital invested in the nation, for which reasons its massive consumption had met with almost no restrictive considerations. When responsible energy policymakers today envisage the "strategic" goal of "disconnecting" economic growth from the use of petroleum, and proclaim their success with corresponding statistical findings, this is meant a bit more seriously. "Economizing" in this sense (not simply the reduction in energy consumption, but an over-proportionate rise in the effects of energy consumption in terms of money) can in fact only work out favorably — both in respect to the security of supply, which by no means can come at the expense of the cheapness of the energy factor, as well as the matter of price, which has to be dealt with in such a way that it does not endanger the security of supply. Various governments have thought of a rather paradoxical "solution" to this problem: raising the costs of energy consumption through taxes in order to make investments that diminish consumption profitable, so that energy consumption then becomes cheaper in the capitalistic profit and loss accounts of individual companies and on a national scale. Thus, in the end, profits can be made even more quickly and accumulation accelerated.

This benefits not least the energy industry especially, as its turnover and profits depend on general economic growth, just as the latter depends on the profit-making provision of power.

b) With its tax policy, state power helps itself to money from energy consumption as it does whenever commodities change hands, yet more so in the case of oil. For the revenue side of its budget, it makes use of the fact that energy is, of necessity, used always, everywhere, continuously and in great quantities. And by its surcharges, it additionally benefits from the fact that petroleum can be obtained especially so cheaply, while having become the number one indispensable item of mass consumption — a fiscal windfall from its basic decision on behalf of oil as the energy source for use on its territory.

A state that intends to govern its capital-site successfully is a big friend and supporter of the oil business because the latter's unbeatable cheap supply of energy benefits its society in general and national economic growth in particular. This does not prevent it, however, from enriching itself by taxing the turnover of exactly this industry at even higher rates. The fact that its business on its territory fares so well with energy from oil is taken as a stroke of luck for the state and its financial needs. It can help itself from the energy-producing industry without ruining the capitalistically productive effects of low energy costs; rather, it additionally participates in the accelerated growth of business. Tax policymakers like to do a favor for their colleagues in energy policy, who count on the paradoxical effect of decreasing energy costs by increasing taxes on them. They, in turn, allow themselves to be checked by economic policymakers in cases in which the constant expenses for running an especially "energy-intensive" company would merely increase and thus jeopardize its competitiveness in the foreseeable future. On balance, however, they satisfy any modern environmental policymaker; for even though they contribute little to diminish or reduce the plague of pollution, they at least punish it by making it more expensive. This seems to be especially reasonable where energy costs do not make a difference in the balance sheets of a company but have to be paid for by private end users. The treasury gets its hands on the highest percentages and biggest sums when taxing private transport, which has actually only assumed its enormous proportions because of cheap fossil fuels, thus becoming meanwhile a general necessity of life (which was acknowledged and intended by the state, subsidized politically and in no way prevented) and ruining not only forests. For finance policymakers conscious of their territory's suitability for business, this is the most conceivably appropriate supplement to the income tax.

After all, state power does something in return, and not only in matters of road construction.

c) By its foreign trade policy, the state power of the great "consumer countries" pursues the aim of getting the supply of the raw material for generating energy, on which it has made its national economy dependent, under control and of keeping the price low. It firmly looks after the oil industry, directs the multinationals' foreign activities in accordance with the most conceivably reliable national supply, and occasionally supports its own companies. It influences many different supplying countries in this direction, and seeks to make their state apparatus and their economy dependent on its payments as well as on credit and the provision of commodities from its own country. In this policy, the oil-importing powers mutually poach on each other's preserves. And there is another matter of competition raised by the state-supported import of petroleum: that the national oil bill affects the relation between the global economic powers' currencies.

When, for whatever reason, fuel prices rise noticeably, public attention is paid to the "national oil bill" as if it were one's own private bill. And the democratic public has such a bad opinion of it, that one might think to advise the nation that it would be better off doing without oil. Not even the experts will admit that this "bill" only exists because it pays off for the national economy; pays off so much in fact that several percentage points of economic growth — to which an especially low price obviously contributes beforehand — are lost as soon as the stuff increases in price. But it would just be too much to expect the public to get the matter right while pursuing political correctness. As always, the right tone is struck by asking the authorities to do things they forcefully do anyway: to take precautions to keep the national oil bill "affordable" and make it clear to suppliers that their commodity is neither about foreign mineral resources nor about a business item like any other, but about "our oil." What has to be prevented in any case is the worst-case scenario of a real delivery shortage. This, however, is obviously nothing to be publicly worried about in any of the democratic "consumer countries" — undoubtedly thanks to the policy practiced by these countries in matters of petroleum trading.

This policy fundamentally counts on the oil conglomerates' own business interest. From this, the politically responsible authorities expect an optimal supply for no other reason than that the multinationals are interested in nothing but making lots of money and, to achieve this, selling as much as possible. All that the companies do for it — exploring for more and more new deposits, monopolizing the rights to exploit old and new deposits, taking direct control of extraction and transport, finally competing for maximal proceeds — is politically all well and good. But it is not enough, for two complementary reasons. First, the conglomerates need political support because their business is a matter of contracts with sovereign rulers. And second, the energy supply for their respective nation is too much an important matter of concern for the politicians of the "consumer countries." They simply cannot leave the oil traders to their own devices in the performance of this responsible task, after having transferred the execution of this task to the oil dealers as a highly profitable field of business, thus releasing it from their sovereign control.

So they lend the entire weight of their political power to the world-encompassing interests and activities of the energy industry. They diplomatically clear the way to the industry's political business partners and exercise influence on the latter in order to promote good relations. They remind their foreign colleagues of their urgent need for petrodollars, a need that can be taken for granted in each of the supplier countries, as well as of their well-understood interest in things the "consumer countries" have that the foreigners don't have: credit (political and financial), commodities, and not least importantly, military equipment for the preservation of their own sovereign power, as well as capital and items of capital expenditure for the extraction of oil and the building up of elements of their own national economy. The goal of all this is to create "mutually advantageous" contracts that, firstly, secure the raw material for energy, secondly at "suitable prices," and thirdly secure a return business for the oil-importing country by which it can immediately recoup the spent money right away — at one time referred to as "recycling petrodollars."

It clearly follows, of course, that the capitalistic powers in no way simply and without reservation work towards establishing a global oil market in which the multinationals, who are indifferent toward nationality and stubbornly pursue their business interests, supply all wealthy clients equally. Rather, they superimpose a network of bilateral agreements on the concerns' world-encompassing system of trade relations. By this means they secure themselves special terms and guarantees of supply and, additionally, export possibilities for their own nation's industrial, trade and finance sectors, thus causing a certain discrimination against other "consuming countries." When pipelines are built, it is quite objectively all about gearing the oil trade to particular national partners. The power relations as regards trade policy materialize in an infrastructure that also affects those countries neighboring the "oil states" and sorts them out geopolitically. Thus the political supervision of the oil concerns' cross-border activities — which both sides consider to be necessary — makes sure that the capitalistic nations' demand for a secure supply, and the power which they know they can use from time to time to enforce this demand on their sovereign contract partners in the "oil countries," not only paves, but also shows the way for the energy companies.

It is in the nature of things that the interests of states and oil companies are by and large in agreement with each other; the most powerful nations are the most interesting markets for oil traders, and the other way around, the states' interest in oil is a boon for the relevant companies. All the same, the two situations are and remain of a different nature and in the end do not really coincide, so that the governments in charge, just because they do not think at all of resuming direct control of the entire field, every now and then experience the desire for control. They support the oil business, but demand in return special guarantees from the companies as well as from the supplying states that their own capital-sites be supplied. They insist on their political instructions being respected, for instance when building transport routes, where strategic and global political points of view occasionally prohibit the choice of the most profitable route. The greatest state powers thereby start from the assumption that "their" multinationals can be reminded of their civic duties for business reasons alone. Yet these are, as multinationals, only too often under obligation to contradictory state interests. This inclines various governments to favor an oil company of their own, which as a solely national entity might be reliably directed and willing to translate governmentally-set targets into action. This in turn arouses competitors to endeavor to have these kinds of commercial companies infiltrated, taken over, or booted out by their "own" companies. And so on.

However, all the efforts of the great nations to tailor the world-encompassing oil trade to themselves and their needs have not — indeed up to now not at all — led to the destruction of the cross-border free wheeling and dealing with this stuff. Their contrary interests in cheap prices and secure supply, which are met with complete approval by the "oil states," are still relativized by their corresponding interest in one world market for petroleum that the multinationals are meant to form out of their calculations.

Which national interest answers in the last instance for this internationalism of the world oil business, because it feels best served by it, follows from the very national nature of the means of business that in the meantime dominates this sphere. The oil supply of all the "consumer countries" is subject to a particular imperialistic condition: that the customers must have dollars at their disposal. Quite a lot of countries founder on that condition. They pay for this stuff —an indispensable means for vital material processes of these countries as well — by going hopelessly into debt. But these are the members of the community of nations that don't count in the world economy anyway. Yet even the great and powerful capital-sites outside America have a problem in respect to the denominating currency of the oil price, if only a very exquisite one. Not that they wouldn't have the foreign reserves required to assert themselves on the global oil market. They must, however, buy the oil currency; i.e., their money is not in itself the unconditionally valid global means of payment required to buy the vital capitalistic raw material. For this reason they are not only exposed, in their balances of trade, to the fluctuations of the dollar-denominated price for the barrel of oil but also to the fluctuations of their own currency against the dollar. And not only this, but any time they purchase this raw material for energy, that is, continually, they automatically attest to the first-class status of the American currency, to its primacy over their own currency as the self-evident form of existence for capitalistic wealth in the world, and even confirm its market value by their demand for petrodollars.

The Europeans and Japanese, who we're talking about here, do not become directly poorer because of this class relation of currencies on the oil market, nor do Americans become richer through it. In the end, the permanent demand for dollars as the means of purchase for oil plays a roll, however, in how much the wealth of a nation counts in worldwide comparison, that is as measured by the exchange rate of their currencies. And the other way around, the exchange rate of the dollar decides, among other things, how much national wealth has to be laid out by a country's capitalists for buying energy and as a consequence how things look, in comparison to other national capital-sites, for the national rate of accumulation. Small wonder that America's main European competitors have linked the creation of a common currency to the target of emancipating themselves from the dollar, not least in buying petroleum. Up to now, they haven't, however, succeeded in this, nor have they, apparently, even really tried. For terminating the economic power relations in the world, as they are materially represented in the petrodollar, the alternative euro-imperialism does not — yet — quite make it.

d) With their security policy, the big oil-consuming states make common cause. They confront their sovereign partners in the oil business with a dictate to cooperate, confirm this by an unambiguous general threat of war and, all over the world, make arrangements strategically adapted for interventions as needed. Thus they make sure that their oil suppliers' calculating business sense, which they exploit and strain, indeed lasts. The last irremovable residual risk of their control regime lies less with its addressees than with themselves. Above and beyond their own competing calculations, there is no ultimate guarantee of force for the durability of their will to stick together, on the one side as the leading nation, on the other side as second-class allied partners.

When the capitalistic world powers relinquish self-sufficiency in a politico-economic matter vital to their nation, in fact practically abandon even the chance of an approximate self-sufficiency in the long term, and consequently make their capital-site and thus their own existence conditional on circumstances beyond the borders of their sovereign power, then according to their own calculation, they take on an enormous risk. In the end, they link their destiny to the good will of foreign sovereigns. All the maneuvers of their trade and commercial policy, with which they contractually secure supply, do not remove this residual risk. For they start from the assumption of their sovereign contracting partners' calculating willingness to cooperate and to remain true to the contracts, and this is taken for granted. They do not, however, provide any security against dissenting calculations nor against the event of commerce being terminated by a partner. However unlikely such an alternative may actually be, it is completely unacceptable for the great "consumer countries;" there is simply too much at stake. Their leadership insists on keeping the national conditions of existence — which they have let out of their hands within the nation — under control abroad, and as a consequence, subjugate the sovereign will of their suppliers to their supremacy.

And yet, at present, the same powers deny themselves the course they all-too-often pursued in the past, which admittedly is the only course a single superpower may pursue with any chance of success; that is, settling the matter of might by colonization, conquest or some other form of direct control over the required lands and deposits. They do not dissociate themselves from the standpoint of free commerce with formally equal partners. They thereby rely on a general regime of deterrence imposed on acknowledged sovereign powers that does not leave any alternative open for the latter, instead of depending on downright bi- or multilateral vassal relations.[note 8] This regime is created in common by these powers; it is not to be had in any other way. Formally, they declare the security of their energy supply to be a vital interest, for the defense of which they will answer collectively (in the form of NATO) and otherwise look after with suitable alliances on a worldwide scale. They accordingly arm themselves with rapid reaction troops and prepare in common together with the affected countries, mostly within the framework of NATO's so-called "partnership for peace." Their alliance is reliable — at least reliable enough to make a worldwide impression — because it is in no way an unforced alliance among equal parties, but rather the work of the United States. With its superior force, the United States defines the worldwide power relations to which the capitalistic democracies of Europe associate themselves. In this association, the Europeans count as second- through fourth-rate accomplices as well as participating beneficiaries of the American grasping will to have access to the world; the same goes for the East Asian allies. This collaboration lacks in itself, of course, the ultimate forceful guarantee. On the other hand, the sovereign participants' calculations, free to this extent, are shaped by so much interest in the alliance, to be at any rate sufficient for bullying the oil states.

e) By intervening in their nation's energy supply, governments of "consumer countries" furnish a third determining component of the oil price. Their interventions both impose costs on and save costs for the oil industry, both of which enter in its price calculations. They provide speculators with loads of "data" with which this guild can foretell the future of energy demand and oil supply and, impressed by its own predictions, thus determine the exactly suitable current price.

The state determines the end user's prices of petroleum products not only with taxes — this it does anyway, and how! It manages and controls the oil industry from start to finish — from the first projects of exploration and development to the choice of refining sites — by inter-governmental framework agreements as well as by regulations concerning the sulphur content of heating and motor fuels; and of course also by money.

The largest part of the costs incurred, those for strategic security, are financed by the supreme state power out of its general budget, and rightly so, as this expansion of its military power far beyond its own borders is not just about the particular vital matter of capital accumulation and territory. It is also a matter of its sovereignty in general and its status in the hierarchy of nation-states. Subsidies of a more direct nature are also handed out; after all, the state's desire for a secure supply at cheap prices naturally has its own price. Of course, there are also expenses which enter into the cost price of crude oil, to wit: additional expenses for building pipelines or discretion in acquiring licenses for exploration because of some strategically justified special desires of powerful "consumer countries;" legal obligations to respect property rights and business interests of third parties as codified in "environmental restrictions," now and then imposed even without consideration of price, for instance after especially disastrous tanker accidents; finally even expenses for bribes without which "nothing happens," not only in "oil states." These can in part even be tax-deductible.

Speculators thus get the proper material for their business in their hands, and have much to do to bring about an oil price which is also politically justified. All that governments do with or against one another, all they actually or only probably plan to do, and so on, counts as "data" on the basis of which the future development of the oil market is to be evaluated. Finance capitalists, by nature in front of developments, tend to react in a particularly sensitive way when the great powers, including of course the "world's only superpower," occasionally consider using force once again for securing worldwide business conditions, and not only in respect to the oil market. That interventions of this kind are deemed to be necessary is an unmistakably negative piece of data that causes the raw material to increase in price; yet it may be rather a good thing in the medium term, because then law and order are restored in the community of nations. If a military campaign actually gains momentum, this is fine in so far as doubts are dispelled as to the decisiveness of the governments in charge, on which, after all, the effectiveness of their deterrence policy depends; but it is also negative because it is detrimental to the course of business and in particular may not result in the desired outcome. All the same, finance capital, speculating with a fine understanding of matters, easily succeeds in the end in taking the true, that is to say, only politico-economic meaning from any bloodbath in the world; namely, for this a penny more, for that a dollar less for one barrel of oil.

f) In respect to the political price for oil products that directly affects the masses who drive cars and heat their dwellings in the capitalistic "consumer countries," the democratic public treats itself to ideologies of humility that transform any element of discontent into moral indignation at suitable culprits, steering the discontent from their own state over to sheiks, multinationals or also to other foreign perpetrators of the global climatic disaster.

Democratic public opinion in capitalistic democracies interprets its government's oil policy, and its unpleasant results in regard to an increasing cost of living and polluted quality of life, as a continuous clash of the community with moral problems, in particular with bad characters such as the modern world of states has to offer. Greedy and power-hungry rulers, who have dominion over "our" sources of oil and sin against the right of "our nation" to have service at favorable cost, always play an important role as soon as prices rise markedly once again; tanker accidents that pollute beaches expose the multinationals' greed for profit and the sloppiness of foreign authorities, against which one's own government doesn't dare do enough. These are the enduring characters of the drama, and publicly reviling them provides quite a lot of moral compensation.

At the same time, there's a change in paradigm to be noted in the upper levels of the ideological superstructure that critically examines civilization. Some decades ago, the triviality that fossil fuels only exist in limited amounts and therefore will eventually all be used up, was united, in a theory warning of an imminent energy shortage, with the audacious discovery that capitalists didn't worry at all about this but rather kept on calculating recklessly in respect to energy consumption. An imperative to save energy was derived from this idea and developed into a nearly complete world view, revealing what was really behind the idea and made it so popular. What was expressed in such a general, basic, and defensive way was the fear the homeland would get into an uncontrollable dependency to the degree to which the oil industry was allowed to throw its weight around at the expense of domestic energy sources. This worry and its philosophical re-working alike were triggered off by the historical "oil price shock." Meanwhile, such fears are no longer important; today's ideal collective oil consumer, i.e., the state, is sure of the imperialistic dominion of its successful nation over "its" oil wells. All the more does its public turn their eyes towards the big competitor nations which, not least thanks to their all-too-generous and much-too-cheap energy consumption, are able to achieve economic successes that "we" have to envy them for. It is, therefore, all-too-obvious that they are abusing energy resources. Europeans once again know how to express this in their wonderfully generalized way when considering the energy supply, which plays such a big part in the competing national economies. One of the many disastrous effects of the capitalistic mode of production once again provides plenty of irrefutable material for staging a moral global scandal, by which politicians feel "challenged" and "forced to take action." "We all" are warming up the atmosphere too much — and the others can't be persuaded to refrain from doing the same! Because therein lies the essential appeal of a "man-made" global warming with its catastrophic consequences for island states and the insurance business: the main culprits undoubtedly are the disliked leading power, with which the Europeans are increasingly aware of being in a hostile competition, as well as the partner in the Far East whose global economic successes they have always begrudged.

The oil price and oil market are the state's doing; and it is becoming clear what this means. The state power that rules a capital-site fuelled by oil energy elaborates the energy industry's business conditions into a complete system of pressures and objective constraints effective at home and abroad; at home down to the everyday costs of living and polluted living conditions of its ordinary citizens; abroad all the way to a regionally specified universal regime of deterrence for which some deterrent killing now and then is necessary. The market lives on this, its price reacts to this. Or, to put it another way: all this is included in the price of oil.

4. Oil — The supply states' means of existence

a) The "oil states" get whatever material means they have disposal over from the delivered price of oil they insist on and are conceded by the buyer. Their sovereign power is therefore not based on wealth produced by their domestic population. Rather, it is based on the service they render to the economic growth in the capitalistically producing countries by transferring their mineral resources to foreign buyers in a regulated, commercial manner. The money thus acquired is used by them, other than for their self-preservation, for the goal of bringing about a capitalistic national economy of their own that will suit the needs of their power. In full sovereignty and despite all the necessary failures, they undertake the paradoxical venture of using their status as "oil states" to outgrow their status of being merely "oil states."

The situation of petroleum is no different from that of all the other "natural resources." They are a mere material requirement for the production and — possibly extended — reproduction of the material means of society's vital processes, i.e., — in this best of all economic systems — for the permanent creation of profit and the accumulation thus achieved of capitalistic property in all its forms. The fact that petroleum is so vital, so indispensable as an ideal energy raw material for the most powerful nation-states does not change this relation. It gets its importance not from nature, but in and for a process of production in which it is used as a convenient source of energy. As a "resource" lying in the ground, it has no calculable value at all. It is given value because first of all, it is not just lying in abandoned land but has an owner who, however, cannot make any use of it on his own; and second, because there are capitalistic businessmen who are capable of making much use of it and who therefore don't mind spending money on acquiring, extracting, transporting and processing it.

For this reason, the situation of "oil states" is not principally different than that of those countries which fall under the heading of raw material suppliers. These countries supply ingredients for the production of the real wealth of society, i.e., for all the profitable commodities required and having to be paid for by nation-states for expanding their power, by entrepreneurs for running their businesses, and by "consumers" for their means of subsistence, i.e., in the last instance for the production of money that the suppliers do not undertake themselves. The accumulation of capital, into which their natural product enters, takes place elsewhere, in foreign countries. Otherwise, they would of course count among the "capital-sites" and would not be economically defined by raw material.

Digression

When Great Britain's huge North Sea oil reserves were discovered, tapped and exported, the country only mutated into a "sheikdom" in the spiteful fantasy of cartoonists and envious foreigners; for the country's economy, the surplus of this raw material is merely one positive item in its export accounts.

Things are different for Russia. This nation-state is still living on its extensive industrial heritage from Soviet times. Its former organized reproduction, however, is no longer functioning. The budget of the Muscovite state power is, at any rate, no longer financed by a continually created national surplus, but rather by proceeds from raw material exports, especially fuels, that the country no longer needs thanks to the dissolution of its former economy, but that it still has thanks to the latter's former achievements. Thus, in its decline, the country is coming closer to the status of a raw material supplier, albeit an especially powerful one.

Other former Soviet republics have established themselves as sovereign states and base their politico-economic ambitions on free disposal over the "natural resources" on their territory that have passed to them — "at last" — as an accompaniment to the Soviet Union's disintegration. They formerly had the status of at least halfway industrialized suppliers that were integrated into a union-wide division of labor, and at least of being beneficiaries of the real socialist "state-monopolized" economy conducted from Moscow. This they intend to outgrow. Now, by contrast, they prefer to earn ample, real money by cooperating with wealthy clients from all over the world, with investors strong in capital, and politically interested powerful countries. What is more, they are fully acknowledged in these ambitions — and, together with each contract concluded and each actual investment, actually tied down to the status of otherwise "de-industrialized" suppliers and more likely poor beneficiaries of a capitalistic economy, in which, apart from this, they have no say. All the real political and economic freedom they have "achieved" through their sovereignty is the outcome of quite different powerful political interests at work. On the one hand, the United States and the European Union compete for the particular alignment of the oil exports of the former "enslaved nations," which is codified in agreements and materialized in pipelines; on the other hand, the old center in Moscow, which still has the capacity to enforce its interests by material means inherited from Soviet times, competes for marketing their raw materials. Thus, this much is certain: the politically emancipated oil republics are to become nothing but useful figures in the global oil market, appendages, so to speak, to a henceforth genuinely capitalistic calculation for oil supply. All the decisive economic powers' competitive maneuvers they hope to profit and benefit from are at any rate aimed at sorting them into this important branch of world capitalism and at disciplining them accordingly. With all their liberation, they have come this far: they are the sovereign objects of great power calculations regarding prospecting for mineral deposits, and objects of strategic supervision.

While these new creations in the world of states are being shown by the capitalistic powers what their status as oil suppliers involves, the long-established oil states have been doing what they can to escape this status. Some of them have been doing this for decades, and with varying degrees of success in accordance with their quite different conditions and means. But in doing this they have followed a rather stereotypical pattern in accordance with their conditions of existence as "oil states," and the politico-economic necessities for their "development" policy, which will be dealt with in the following paragraphs.

The political economy of "oil states" consists in their foreign relations. They serve foreign interests; at that not even with contributions brought about in their own countries, but rather with the circumstance that states of this kind sit on their oil fields in a somewhat monopolizing manner and transfer their "natural wealth" to its real beneficiaries. In return for this they get a share of capitalistic society's real wealth produced outside their countries, i.e., money created and accumulated in foreign countries with which they are able to appropriate commodities, likewise produced abroad, for their national business — and this is how the worldwide market economy would have it. The internal side of this "oil state" economy is accordingly defined in a negative way. Economically, people and state power don't have anything to do with each other. All that the inhabitants of such a country produce and obtain is maybe just enough for their subsistence, and maybe enough for some surplus appropriated by some ruler, but does not support the political power the authorities get from being an "oil state." The state power, for its part, is not dependent on the bit of agricultural produce its subjects scrape up — this is the agreeable side for the state. The less pleasant side is that its own material basis of existence is not under its control — apart from the "mineral resources" that become its means of existence only through foreign interests.

No "oil state" accepts this nowadays; none of them is content with having the status of an oil well owner incapable of surviving by his own efforts. Even the Arabian "oil sheiks," the ideally typical representatives of this "ground rent" economy, have learned what it means to be sovereign. After all, they are permanently exposed to comparison with the power of capitalistically productive nation-states, in addition compare themselves to these powers by whom and with whose money they are paid, and can't help realizing their huge drawback. They lack material independence; not in the commonplace sense that they would be "dependent on the world market" and "integrated into the international division of labor" as would any member of the market economy family of nations, but rather because they exist in all their political power as nothing but appendages of external interests. Their sovereignty is without any material substance.

This cannot stand; the diagnosis allows no other conclusion. So all the "oil states" have prescribed an economic departure for themselves. They intend to outgrow the status of oil suppliers by the means they have as external suppliers of the world oil business, and to create an economic basis in their own country for themselves by means of their own people and under their own management. To do this, they first of all put themselves into real possession of their oil wells. No state any longer puts up with just letting the multinationals busy themselves on its soil however they like and then collecting some royalties. They all more or less act as their own oil company, manage the extraction and transport of their crude oil mostly on their own or in joint ventures with oil companies, and in any case face their customers as equal business partners with price demands of their own. They become active in matters of procuring money and, thanks to the worldwide demand for their mineral resources and the quality of their oil fields, in most cases so successfully active that they can no longer be lumped together with other raw material countries as regards the amount of their finances. They have the means to set up and finance a full-blown state budget. And with it, they tackle the plan to stage a productive, self-reliant economy in their own country and by means of the people they govern — approximately of the same kind as the one they have merely supplied with their crude oil up to now. Because this kind of economy, i.e., the fully-functioning capitalist one, is taken as the measure of all things by all of them; even if they have officially committed themselves to some "Arab socialism" or to a socialism dedicated to their national cause in some other way, they have never come up with any better idea than to copy the so-successful money-yielding machinery they are confronted with by their "customers." This is how they want to be: like the powers they owe their status and their financial means to and whose commodity offers they have to rely on when they take up the task of changing the existing economy of their people. They invest the proceeds from their oil exports as capital in industries which they expect will supply a future national economy with generally required materials, with energy and especially with capital proceeds, and turn their population into a productively working proletariat. They prefer to take care of the refinement of their crude oil themselves in order to make money on the steps of production that are otherwise dealt with by the oil consortia in such an extremely profitable way. If only it were the case that one company would purchase the profit-containing product of another and so on, and ultimately a functioning "market-oriented" society would convert the entire capital of a nation including all its commodities to cash, then capitalistic wealth would reproduce itself and accumulate. They have no choice but to accept that no such economic circuit can ever be closed. So in addition to the capital advanced, they consequently take upon their budget the expenditure for maintaining an ensemble of fragments of a capitalistic production that is entirely deficient. For this, however, they are, on the one hand, faced by criticism and a strong rejection from the side of their great oil-trading partners. The latter have directly enlisted their suppliers as a market for their commodities to the degree that the suppliers have purchasing power at their disposal and are trying to build up an internal "market economy." That's why their great partners do not tolerate any "state-subsidized" domestic competition — quite in accordance with the freedom of the world market the "oil states" are living on. On the other hand, with all their continuing costly subsidies for staging capitalistic relations of production, the politicians who push "development" sooner or later run up against the limits of their oil incomes and thus into a principal barrier for financing their budget. As long as a state power has no capital-site which would accumulate capital in a self-acting manner, it lacks the power to create credit in a way (and any successful economic policy depends on this) that would be capitalistically effective and be realized in an internationally recognized currency. By emulating the budget policymakers of mature capitalistic nation-states, states that are in the convenient position to draw upon tax and credit resources from a working process of accumulation and to finance effective inducements for increasing and extending the latter, the politicians of "oil states" incur expenditures for their development endeavors that even their successful models could hardly cope with. Nor do they have the most important means at their disposal, that is, national credit. Buying oneself an entire national capitalism is not exactly cheap.

The undertaking becomes all the more expensive as the state power has to take on new and, once again, costly responsibilities for ruling and controlling its country because of its endeavors to turn its subjects into a money-producing and money-yielding capitalistic society. For, by staging a comprehensive money economy, any "oil state" can easily ruin handed-down forms of economic subsistence and their traditional surplus production. But it cannot create the opportunity for the majority of its people to meet the requirements of acquiring money and to make themselves useful by wage labor; let alone create capitalistically profitable jobs so long as nothing is really yet profitable in its domestic economy-under-construction. As a consequence, such a state has to govern a new kind of poverty. And being politically in charge of its people, it can rely neither on the traditional obedience that worked for quite a different sort of political rule, nor on the kind of loyalty that is almost automatically brought about by the "objective constraints" of a bourgeois working life in mature capitalistic nations. On balance, the people cost something instead of rendering their service as a productive class society and capitalistic resource. And this is no accident, but a clear statement about the status of human masses in the development and rebuilding program of an "oil state." So that at the present moment, the countries in the best shape are those whose number of inhabitants is not worth mentioning. All the others have long since acquired more foreign debts than credit in oil proceeds.

So, the political economy of these states — no longer — revolves around the function of being a corresponding member of the oil business — although this function is still the only thing that is of any global economic interest as regards the "oil states," as their designation already reveals, and that is demanded by their capitalistic customers. The economic separation between the political power, based on receiving payments from the "consumer countries," and their subordinate subject population is not the last word on the matter. These governments do everything in their power — by using their proceeds from the oil business or at least a good part of them — in order to materially seize hold of their people and put them to profitable use in order to turn their country from an appendage of foreign money accumulation into the hotbed of a domestic one. This regularly turns out to be difficult, if not impracticable. Small wonder! Trying to outgrow the status of an appendage of foreign interests by using the means of the same is indeed a bit paradoxical. Yet, this is exactly the path for success to a perfect capitalism the "oil states" have committed themselves to. And they do not give it up just because, to start with, they import some unproductive sides of this mode of production.

b) For the sake of their politico-economic emancipation from oil revenues, the "oil states" have taken up a permanent struggle for higher oil revenues. Their means are double-edged; using them always involves the risk of revenue losses. They become effective only if and to the extent that the supplying countries suspend their competition among each other and cooperate in the battle for a share of oil proceeds. In the meantime, they have in fact gotten acknowledged as a negotiating power, but the negotiated compromises lead them back once again to their monoculture with all its drawbacks, so that the fight over the oil price never ends.

In their endeavors to "develop" their country into a high-quality capital-site, the governments of the "oil states" time and again reach the limits of their state budget. But neither do they become critical of their project of purchasing themselves an entire set of capitalistic relations of production, nor do they become critics of this relation of production that they serve as an appendage and that they insist on appropriating. In their hardship, they see but one problem, and a quantitative one at that: obviously their revenues are insufficient; they've got to get more money. So, first of all, they extract as much additional oil as they can. On the one hand, however, this requires investments, which diminishes the hoped-for additional revenues even before they are realized, irrespective of whether an "oil state" thus strains its own budget and burdens it with debts, or whether it lets an oil company make the investments and in return gives it a share in export proceeds. On the other hand, increased exploration, especially if more supplying countries resort to it, has the unpleasant consequence of a fall in prices; an increased amount of exports in the end might bring in less money to the treasury. That's why, secondly, more money is demanded for a given amount of oil. Being, however, against the clear interests of the conglomerates and "consumer countries," such a demand is not easily pushed through. Special agreements with preferred receiving countries are one solution; for instance, agreements on price supplements as a fee for special delivery guarantees. But even in this case, the general world market price for a barrel remains decisive; up to now, all guaranteed prices have been ruined by this. There is no other way to push up this price than to cut down on oil deliveries to such an extent that the desired effect is achieved. This, however, entails a real relinquishment of revenue which, after all, hardly any state can afford for the mere hope of improving its income in the future. Only on one condition can more emerge from this hope than pipe dreams: several important supplying countries must stick together, suspend their competition for the best-possible sales and exert pressure until the oil concerns push through a higher consumer price and are willing to hand over a share of the increase; i.e., are willing to give away one part of the surplus profit they achieve as a sort of regular differential rate to the political owners of the oil fields.

In fact, some of the most important oil states have joined together in an Organization of Petroleum-Exporting Countries (OPEC) for this purpose. In return, the apologists of market economy imperialism have heaped reproaches on them of manipulating the market, of blocking the automatic formation of the only true and just oil price. The "anti-competitive" combination of the "oil states" is, however, in no way directed against the world oil market and its "laws." The crime charged against the OPEC members consists in nothing other than their attempt to hold their own in this market, to make money on the energy demand of the capitalistic powers as well, to have a share in the oil conglomerates' final retail prices and obtained speculative gains, and to draw influence from the economic trends of the worldwide oil business for this purpose. There is nothing adverse to the market in their endeavors as "suppliers" to become a power in this market by political means; rather it is part of the adversities of this market (i.e., the ubiquitous competition of nations) that they don't have any choice but to somehow make their interests respected by a continual political effort.

On the one hand, they have to avoid the disputes their cartel is permanently exposed to and which — as in any cartel — have all the bigger and stronger subversive effects the more their cohesion would be necessary in order to ensure acceptable proceeds for the parties involved. After all, whoever first breaks away from the common front line gets the greatest national advantage.

On the other hand, the associated "oil states" not only have to keep up their commonly managed price policy against the market power of the financially strong conglomerates. They also inevitably get into trouble with the political rulers of the powerful "consumer states," who have little trouble in agreeing on a maximum permissible price for crude oil that would be acceptable for their present capitalistic situation. These mighty rulers also have superior political power for extortion anyway — as well as having sensible contacts among the cartel states, which as a rule spare them the deployment of means of extortion tougher than diplomatic ones.

Thus the extraordinarily civil and peaceful global oil market returns in the end to its starting point. What is crucial in oil price diplomacy in the last instance are international relations of state power. The foundation, as much as the ultimate determining basis of the global oil market economy is the already-decided question of power, i.e., the superior strength of the oil-consuming capitalistic nations that do not give their suppliers any choice.

The crucial point buyers and sellers compete and negotiate for in the oil market is the redemption fee, valid for the time being, for the right of ownership the "oil states" have in regard to their oil fields — i.e., the political ground rent that was dealt with in the first section above. This rent is, according to its economic nature and so also in its amount, once and for all anything but a capital transfer which could turn the supplier countries into regular capital-sites, possibly into such powerful ones that they would be capable of "catching up" with the actual global economic powers and winning in competition; or even such as would need their oil as the motive force for their own economic growth and which would in the end no longer be dependent on squandering it. Consequently, in order to keep the "oil states" with their ambitious budgets in a permanently and precariously constrained position, no imperialistic ban on "development" is required, although such initiatives exist; for instance, American objections against the building-up of manufacturing industries in the oil-producing countries which would be capable of depriving the multinationals of market shares. In principle, the "oil states" can try to build up their national industry, purchasing the requisite equipment on the capitalistic world market with their petrodollars; they can even easily get financial credit for this. The snag, however, is that the pressure to compromise, the political dictate of peaceful coexistence between oil owners and oil consumers, has its effects. The outcome of all quarrelling inevitably is an oil price that everyone can "live with" — one party as the capitalistic beneficiaries of the much sought-after commodity, the other party as oil sellers. It is completely up to the latter to invest their proceeds in either sensible or hopeless projects, but, once and for all, they can neither ask nor get anything else for their "mineral resources" but a just share of the capitalistic world market barrel price. This share is sufficient to spur on their development ambitions and, at the same time, it cements exactly that for which it is actually paid; namely, the status of "oil states" as functional creations and sovereign henchmen of the energy demand of the imperialistic nations.

Some of them even make it to the status of "newly industrialized" countries. But when this occurs, first of all, more has been the cause than just a huge crude oil deposit. And secondly, such a country, together with its "emerging market," then simply continues to be an object of speculation, but on different terms — and more money is made on it than would be made merely from its oil.

c) The imperialistic nations' interest in their crude oil makes the sovereigns of "oil states," intent as they are on increasing their power while suffering from the insufficiency of their civil efforts, resort to the alternative of using their mineral resource as a weapon; i.e., to threaten with boycott on the one hand, and on the other hand to equip themselves with armed forces from their sales proceeds, to fight for corrections in the international relations of power and to get support from the decisive powers to whom they are so important; or at least to extort tolerance for their struggle for national advancement. By employing the oil weapon, they experiment with the ultimate revolt against their status as mere "oil states," against international relations of power which tie them to an existence based on foreign money payments, and in all this, they speculate on the interests of exactly those powers to whom they owe this existence. If such a ruler seriously takes forceful action against those relations of power within his reach by which he feels restricted, he risks a war of deterrence in which he has hardly any chance.

Ambitious sovereigns over oil-rich lands strive to change the relations in which their country and power are entangled; and time and again, one of them feels urged to action. This is inevitable. For, on the one hand, they realize well enough that for those nations that have made it to the production of wealth in abundance and the accumulation of state power, there is a pressing "vital interest" in their natural wealth. The oil sovereigns thus feel entitled and authorized to a status equal to that of their customers. On the other hand, they note the permanent failure of their efforts to become a respectable power, that is on an independent material basis, in a civil way, and by the means the world oil market provides for them. Their practical conclusion from this national predicament does not stop at accusations against an unjust global economic order and helpless petitions for support. They search for the hindrances blocking the success of their efforts at advancement; that is, for those hindrances that are within the reach of the means of power they have access to thanks to their oil revenues and their relations to the powerful "consumer states." And they always find starting points in their own neighborhood for a change in the political terms of business they blame their failure on, and that can't be dealt with by economic means.

In the first of two exemplary cases worth mentioning, the Middle Eastern "oil states" in their second quality as "Arab Nations" supported a war against Israel by material means and, for the first time, deployed the "oil weapon" via an effective restriction on the extraction and delivery of their oil. They saw in the Jewish state supported by America the outpost of an imperialistic suppression of their pan-Arab emancipation, and fought it accordingly. A victory, so they hoped, would shift the international relations of power decisively in favor of their "Arab cause." The war was lost; "Greater Arabia" remained the chimera it had been — not only because of Israel's superior strength. And the extortion of their imperialistic customers by means of cancelled oil deliveries did not result in anything else other than what one might expect; namely, the oil business was resumed, completely within the framework and in accordance with the old business terms; although at a new, higher price level that has, however, rather "crumbled" again little by little.

The second attempt to forcibly improve the status of the "Arab Nation," as represented by one nation in particular, was made by Iraq's government in its war against revolutionary Islamic Iran and in its attempted annexation of Kuwait. From the Iraqi point of view, both military campaigns had the same goal, to gain command over one important part of the world's oil reserves so as to put an end to the competition of oil owners, especially in the Gulf region. According to Iraqi opinion, this competition stands in the way of a thoroughly successful use of the raw material for energy, so urgently needed in the rich countries, as a motor for development of wealth and power on one's own side. This was to lead the entire region, from a position of successful and acknowledged supremacy, to the place it deserves in the hierarchy of world powers. Because, first of all, it had been perfectly clear to the Iraqi leadership that the oil trade in principle could be used to gain lots of autonomous power, were not the success permanently being foiled by competitors or enemies, hostile either on their own initiative, or bought or kept by imperialism. Secondly, this leadership thought this principle had been proved in practice by the considerable military power it had been able to accumulate through its oil revenues to date. And thirdly, it had been sure it could count on the interested calculations of the decisive power for world order, the United States, being in favor of its action. The first Gulf War was against America's new main enemy in the region, Iran, for which war a calculating support had indeed been provided by the imperialistic powers after all. For its second campaign, the occupation and annexation of Kuwait, Baghdad thought to have deserved tacit approval at least, and by no means reckoned with a regular war from the side of the superpower, particularly since this would actually jeopardize the oil supply, the Western business world's most important matter of concern.

So the Iraqi government's calculations were directed at revising the political relations of power in the Middle East by military power and liberating the nation from restrictions that doomed it and the "Arab Nation" to a third-rate status in the hierarchy of states; yet without making an enemy of the originator and guarantor of exactly these international relations. Iraq, following the matter to its final conclusion, thus tried to solve to its own benefit the contradiction between its own power's real basis lying totally outside its reach and its will to emancipation. And for this it suffered a rebuke that remains in force to this day. The first Gulf War still pleased the Americans; not only because it was against the unruly Iranian Islamic republic, but also because it was expected that Iraq, sympathizing for decades with the wrong side in the Cold War and equipped by the Soviet main enemy, would be weakened. Two problem cases in the Near Eastern world of states were to mutually neutralize each other; that is why it was more the war itself rather than Iraq that was accordingly supported. When Kuwait was attacked, the United States was not interested in finding out whether a more powerful Iraq would not be more than a particularly big appendage of the oil business. America thought it was high time to seize the opportunity for translating the threat of war that it had held in store for such substantial unauthorized behavior into action, a threat that it considered necessary to confront the remaining world with, in view of the abdication of its Soviet opponent. Under the label "new world order," it brought its global regime of deterrence to its current post-Soviet state of existence. Thus Iraq's attempt to pursue its emancipation has in the end not led to anything but an exemplary defeat — and to some opportunities for the speculation business centering on the price of oil.

Conversely, the recent and more civil attempt of the defeated Iraqi state power might set more into motion than all its battles. Its proposal, given as an ultimatum to be paid in euros instead of dollars for the oil exports permitted by the U.N., indeed hardly touches the oil price itself, but precisely on the currency — thus, however, on nothing less than the question already rather cautiously raised by quite some other powers and only posed with reservations and denials as to whether the ultimate command over the single most important economic resource in world capitalism should really and always rest with the United States and its dollar. It is only too logical that America's declared military enemy put this question on the agenda, for it contains a cancellation of the present international rules of competition.[note 9] The "oil states" will quite certainly be the last to answer it.

So this too is achieved by the oil price: for those countries in which the oil deposits lie and which sell oil for a justly negotiated sum of dollars, the price of oil procures a political rule with ambitions. This rule, in turn, tries to impose a complete capitalism on its people by means, of necessity, insufficient though powerful, and without any restriction by, nor consideration for, the traditional form of production and subsistence of its people. From its position as a henchman for the capitalistic world order, it often develops anti-imperialistic ambitions and, as soon as it becomes serious, a sub-imperialistic thirst for action. In the end, it attempts to forcefully re-order its surrounding region and is taught by the real imperialists how might and right are actually distributed on the globe. All these niceties are of necessity included and bought along with the oil in the price that the "oil states" and the "consumer states" permanently haggle over.

Notes

1. Use-value: the commodity regarded as an aggregate of its useful properties, as opposed to its price.

2. The United States has made the oil industry a decisive part of the capitalistic energy supply because it has nearly unlimited amounts of easily extractable crude oil on its own territory. In the meantime it imports only a little less than is extracted in the country. In this way the state allegedly intentionally saves its own reserves. This, however, merely means that these no longer meet the demand even in the medium term; even in America, oil extraction couldn't be doubled in the short term. Great Britain, Denmark and Norway are the only exceptional cases in which an "industrialized nation" that accumulates on capitalistic terms exports oil.

3. In the wake of their political emancipation or even afterwards, the former colonies had to fight for this kind of freedom of the world market, i.e., the right to sell petroleum found in their territory on their own responsibility. That this freedom would turn out for the liberated nations to be a reliably objective constraint, to have to henceforth hand over their mineral "resources" inexpensively on their own responsibility, did not at all appear to be so certain for the oil-consuming colonial powers. The Americans, by contrast, had been all the more convinced of the possibility that their imperialistic rivals' monopolistic right of disposal over the natural produce of their colonies could be effectively annulled this way, and that the right of the greatest financial power, a power America clearly had, could be helped on its road to success. The American anti-colonialists had, however, also been aware from the beginning that the automatic functioning of free commerce would only have its reliable effects if the oil-selling sovereigns lacked any alternative — especially in those days, the altogether real alternative of an orientation towards the other half of the world that ran its economy in accordance with a "real socialist" plan. That is why the Americans did not allow the slightest strategic "power vacuum" to spread in the decolonialized oil regions of the world, fought Soviet influence by means quite other than commercial, and have placed the post-Soviet era under the directive that, for the United States, free access to petroleum around the world is one of its "vital interests" that justify an armed conflict at any time.

4. One could also with equal justification refer to air traffic, to mass tourism to remote destinations, and to the formation of a global tourist industry for increasing the demand for energy. Without petroleum, none of this would have happened…

5. Karl Marx, Capital Vol. 3, chapter 38.

6. The history of this fight over distribution and its interim results is of no importance for the principles of the price calculations, which are made by the oil companies as the actual economic subjects acting on the world oil market. What may, however, be gathered from it is a general picture of the habits of this business and its creatures.

7. See also sections c) and d) below.

8. Some "good relations" undoubtedly come close to being colonial; for instance that between the United States and Saudi Arabia. In the American system of imperialism, however, these relations serve the aim of locally supporting a global regime; the latter does not consist of merely such relations of de facto domination.

9. In its negotiations with the European Union, Russia also linked its program of a Russo-European energy pact to a proposal to strengthen the euro by " replacing the dollar as the clearing unit for the Russian delivery of energy supplies" (Novaya Gazeta, as reported in Russische Medienübersicht [Russian Media Review], German Embassy in Moscow, Nov 1, 2000) For the Russian government, this is avowedly a matter of strategic interest: It tries to promote "notions of a multi-polar world order." This proposal is indeed not only aimed at a more convenient way of billing oil exports but is, in its consequence, actually directed against the present unity of the world oil market which is guaranteed by the United States and realized in U.S. dollars in a businesslike manner, i.e., it is directed against a central piece of the imperialistic business order. The Europeans, of course, know all this — that's why they have for the present met the Russian idea with an officially tacit disregard.


© GegenStandpunkt 2002