Wednesday, September 24, 2014

Stories of Carlos the Jackal: "A winter day in Vienna when the world’s most powerful oil barons stared down the barrel of a gun"

From The Appendix:

First Day of Terror
Carols echoed through the Christkindmarkt in Vienna on the morning of December 21, 1975. The sky was overcast, and trees stood leafless in the neighboring parks. The edelweiss flowers adorning many of the stalls and shop windows were past their bloom, and their petals and leaves had begun to crumble.

Shoppers and stall-minders alike—transfixed by the edelweiss, roasting chestnuts, mulled wine, and gingerbread—paid little mind to the building across the street. That concrete-and-glass rectangle, shared by the Organization of Petroleum Exporting Countries and the multinational oil giant Texaco, was one of many drab and unassuming buildings that had popped up amidst the grandeur of Austro-Hungarian modernist buildings and parks. But if the architecture was neither eclectic nor unusual, the moment that would soon face its occupants was. As six casually dressed young people carrying black Adidas bags turned the corner and began to approach the building, the oil ministers from Saudi Arabia, Iran, Iraq, Venezuela, Libya, and Algeria had begun another round of discussions about the price of oil. Their meetings had been headline material for over two years, since October 1973.

That month, the Egyptian army had thundered across the Suez Canal while Syrian troops stormed into the Golan Heights in a coordinated attack on Israel. They acted with Saudi Arabian, Iraqi, Kuwaiti, and Libyan financing, as well as Algerian, Tunisian, and Moroccan material support. Soviet leaders expressed frustration that Egyptian President Anwar Sadat had disregarded their counsel against war, but immediately began to resupply their “Arab brothers.” Ten days later, after Sadat refused a cease-fire, the Nixon administration announced a multi-billion dollar arms lift to Israel. The Arab members of OPEC hastily convened at the Kuwait Sheraton. They announced the imposition of an oil embargo on the United States, general supply cuts, and a 70-percent increase in Persian Gulf oil’s posted price, from $3.01 to $5.11 per barrel. The non-Arab OPEC members immediately followed suit. For the first time in their history, the oil-producing nations had set the price of oil.

According to its more radical personalities—men from Iraq, Algeria, and Libya—OPEC had thrown off the imperialistic shackles imposed upon them by the multinational oil companies in the first half of the twentieth century. When OPEC successfully increased prices fourfold between October 1973 and January 1974, its most vocal leaders framed their success in the language of liberation from what former Saudi oil minister Abdullah al-Tariki called “petroleum colonization.” Algerian President Houari Boumediène emphasized the “new equilibrium between developed and developing states” and the possibility for “non-aligned [countries] to assert greater control over their natural resources.” The Third World could not allow the First “to establish a protectorate” over the new economic order as it had the previous one, he told a reporter at Le Monde. More conservative, pro-American leaders echoed that sentiment. “It is only equitable and just that the oil producing countries” had ended the era in which oil sold “at ridiculously low prices,” the Shah of Iran opined from the steps of the OPEC headquarters in December 1973.

The West owed the rest a debt. That position had some truth; the biggest and richest oil concessions in the world had been granted in the high era of imperialism, when gunboat diplomacy had backed Western corporate executives in their quest to wrest wildly profitable terms from their weak Middle Eastern counterparts. An oft-cited example, the 1925 oil concession to Iraq, had only been granted when Britain had threatened to lop off the oil-rich province of Mosul from the rest of the country. That vision of an imperial economic hangover resonated broadly with nationalists across the “Third World” of former colonies and other poor nations. The shared history of exploitation, formal or informal, had left a backlogged legacy. “Economic emancipation,” to use a phrase that became common among the leaders of the Non-Aligned Movement, had become essential to the ongoing struggle to eliminate political domination.

At a Special Session of the United Nations in April 1974, the representatives of the developing nations universally supported OPEC and condemned “the current structure of economic relations.” The ruthless dictator of Uganda, Idi Amin, summarized that position a year later. The moves of OPEC were part of a greater attempt at “the restoration of full economic rights to the hitherto exploited, oppressed, and enslaved peoples of the Third World.” The end of formal colonialism was but a single step in a longer journey. “The world-wide war for self-determination and political independence is almost over now, but the struggle for self-reliance continues,” he continued. “The present stage in this struggle is for economic independence.”

The images of an enslaved past and a liberated future had bewitched the imaginations of Third World elites of all stripes since the 1950s. OPEC had turned upside down the economics of empire, and pushed back the forces of the past. The OPEC leaders shined that point to rhetorical perfection in their public statements. According to them, the oil-producing nations had infused the striving rhetoric of political liberation into a vast domain of economic life. Their control over the price of oil was testimony to their success....MORE