Tuesday, December 9, 2014

Oil conflict carries the germs of world conflict

By EMERY BARCS  1947-2-13


SENATOR Joseph O'Mahoney, chairman of a special committee investigating U.S. petroleum resources. said recently that  America's Standard Oil and Texas Oil companies are trying to establish their domination over the European and possibly over the world oil trade. Although he gave no details, this mere mention of such an action has caused considerable International bewilderment. Oil has the highest priority In power politics and anybody who touches it is bound either to hurt others or be hurt himself.  The axiom of Lord Fisher—One of the ablest and most far-sighted leaders the British Navy ever had—that "oil power Is world power," is as true today as when he said it some 40 years ago.

The free access of the Allies to the most important oilfields of the world, and Germany's deficiency in the "blood of modern warfare" had a decisive Influence on the outcome of both world wars. And it is safe to say that whatever new weapons the world develops in the future, the vital importance of oil will not diminish for a considerab!e time

 A FEW figures will clarly show what it means to a modern war run on oil. 1938 the world's  natural oil a production reached new of about 284,000,000 peak tons. But, in spite of the   large destruction of important oil refineries and wells in Europe, Russia, and South-East Asia. world production had risen to 391,000,000 tons.

Probably less than 20 per cent. of greatly increased production went for essential civilian use. With the rest at the oil, the armies, navies, and air forces of the world had quenched the enormous thirst of the war machinery. The Allies had been able to secure a continuous flow of oil because during the war their fields produced 1,877,000,000 tons of natural oil. Axis fields produced only 88,000,000 tons and they could not replace their deficiencies with "ersatz." Thus warships, tanks, lorries, and aeroplanes alone during  the six years of war swallowed almost six years of normal world oil consumption. The planes of the oil-starved Luftwaffe, pinned to their bases because of lack of fuel, the immobilised tanks and mechanised guns of the Wehrmacht towards the end of the great struggle, had proved that deficiency in oil means defeat. Perhaps this lesson, rather than fear of any sort of weapons, will become a major obstacle to future wars.

It would, however, be a mistake to believe that the few countries which today control oil, can look into the future with serene confidence. Oil deposits. compared with the enormous consumption, are extremely meagre. In July, 1946, however, the known oil-fields contained no more than between 8,000,000,000 to 9,000,000,000 tons, or roughly 22 times he world production in 1945. This means 22 years of assured supplies. Oil experts differ whether undiscovered oilfields will greatly increase the present estimate. The pessimists say that the oil-age will be finished well within half a century because of exhaustion of deposits. But the optimists believe that the real oil deposits, hidden under the oceans, and deposits not yet discovered on the mainlands, are enormous.

Today three nations control practically the entire oil deposits of the world: the United States. Britain and Soviet   Russia. The U.S. controls 56 5 per cent., Britain 25, and Russia 13. France has a two per cent. share, Mexico 1.5, and the rest of the world another two per cent.  The share in production follows the same proportion, although Britain is in a slightly more advantageous position. American interests produce 47.39 per cent. of the world output Britain 38.73, and Russia 8.60. The remaining 5.28 per cent. is divided among all the other countries.  Without the slightest doubt, oil is an international problem of the greatest importance.

Those who constantly refer to the control of oil resources as being only the business of big vested interests, have not the faintest idea what they are talking about. Since the beginning of the century the governments, and through them the peoples of the two big oil powers (Britain and America), have obtained great shares in commercial oil companies. The Anglo-Iranian Company and its subsidiaries are practically nationalised enterprises because the British Government owns about 56 per cent. of its shares.  Repeated statements have been made that government interest has also increased in the other great British-controlled concern, the Royal Dutch Shell. In spite of opposition from the American oil industry, the U.S. Government has entered it on a large scale.

The Compagnie Francais des Petroles is a French State monopoly for the control of the two per cent. world oil interests of France. By 1938 Mexican oil had been nationalised. Soviet Russia, of course, has an entirely socialised oil industry.

AMERICAN oil power was  created and organised by John D. Rockefeller, who died in 1936 at the age of 97. He left £400,000,000 and two organisations to his heirs. One was the Standard Oil, the other the Rockefeller Foundation. With the foundation he wanted to expiate thosa innumerable crimes which he committed to make Standard Oil great. British oil power Is connected with four names. Only one of them, William K. D'Arcy, who discovered the oil wells of Iran, was British. The other three were:

* Dutchman Sir Henri Deterding, who developed the Royal Dutch Shell into the largest oil company of the world after Standard Oil. Because of his pro-Nazi syrnpathies, he had to retire from the company in 1936. When he died six months before the outbreak of World War II he was buried on his German estate in Mecklenburg

 * Polish Jew, Marcus Samuel, later Lord Bearstead, who at one stage of his career ran a small shop in London's Whitechapel called The Shell. It sold souvenirs made out of shells. This is the origin of the word "Shell" in the great British-controlled company

* Armenian, Calcus Sarkis Guelbenkian, the grey eminence behind Shell world power. These men. who started their careers as little nobodies, and became fabulously wealthy and powerful, did not secure world oil supremacy for Britain and America because of patriotic motives. They wanted to make, and did make, fortunes. But whatever their reasons, and however unsavoury their methods, as a result of their work Britain and America control more than 80 per cent. of the world's oil.

Since the end of World War I, clashes between British and American oil interests were few,  and the general tone has been mutual concessions and collaboration. If one of these two groups tried to grab sole world domination, the result would be a ferocious war with serious consequences for both. Oil conflict carries the germs of world conflict. This is the reason why the obscure hints of Senator Mahoney caused such bewilderment.

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