Foreign Policy
September 8, 2009
Across the globe, oil is invoked as an agent of destiny. Oil will make you rich, oil will make you poor, oil will bring war, oil will deliver peace, oil will shape our world as much as the glaciers did in the Ice Age.
But how?
Oil is not a machine that can be disassembled or schematized for comprehension. It is a liquid. How do you coax secrets from a liquid? To know a person, you talk to him. To know a country, you visit it. To know a religion, you study sacred texts. Oil defies these norms of interrogation. It is a commodity that is extracted, refined, shipped, and poured into gas tanks with few people seeing it. It has no voice, body, army, or dogma of its own. It is invisible most of the time, but like gravity, it influences everything.
Over the course of eight years, I tried to solve this puzzle by talking with people who worked in the industry, visiting people who were touched by its operations, and taking a look not only at oil fields but the battlefields they have spawned. I met with oilmen in Houston, princes in Riyadh, lobbyists in Washington, roughnecks in Baku, warlords in the Niger Delta, leftists in Caracas, billionaires in Moscow, environmentalists in Quito, generals in Baghdad, traders in Manhattan, wildcatters in Midland, and diplomats in London. If you have conversations with people such as these, the topics you discuss include not just politics and economics but history, geology, geography, chemistry, engineering, physics, climatology, ecology, accounting, law, corruption, culture, psychology, anthropology, greed, envy, disease, ego, and fear. The world of oil is an intellectual as much as a physical space, and my years of journeying took me through a crude world that is as dark and amazing as the liquid that casts a spell on all of us.
Nigeria
The canoe that carried me into the Niger Delta had an outboard engine that conked out several times before reaching Tombia, which was then the latest target in Nigeria’s long-running oil war. Tombia was a shambles, half its homes burned or bombed beyond repair. A dozen survivors came to the creek, and their manner was not warm. They were young men, fighters, some with soiled bandages. Fingers and hands were missing; limbs were swathed in pus-caked gauze. Government forces had attacked Tombia in the brutal way they usually do, with helicopter gunships strafing anything that moved and speedboats disgorging soldiers who shot their way through town. A dozen people were reported killed, and most of the town’s population was too frightened to return — but in any event, there was not much to return to.
The leader of these survivors, whose nickname was Prince, angrily pointed out the town’s destruction with the stump of what used to be his right hand. Even the Lutheran cathedral, St. Stephen’s, was destroyed. Its timid pastor, living in a shack and shivering from malaria or fear of the bitter youths who now ruled this wasteland, said it had been constructed by British missionaries in 1915. A sign by the church declared in English, “Tombia is dedicated to God. Jesus the King over the land. Holy ghost in charge.”
A boy who looked 12 years old and was blind in one eye stood in front of a house that had burned to its concrete foundation. His older brother had been killed, he said, and the town was now dead and his river was dead too, tainted by oil. Because of the pollution, he could not possibly catch enough fish to nourish himself and his dead brother’s family. He was angry and hopeless; the result was listlessness. The government, the Army, Royal Dutch/Shell, the warlords, the writer who would leave in a few minutes — they would not help. His only hope was, it seemed, the Holy Ghost.
I returned to the canoe and it was not long, just an hour or so, before I reached Oro Sangama. Its defining feature was apprehended on first inhalation — a heavy odor of sewage that had fused with humidity to form a fecal mist. It existed because Sangama’s residents relieved themselves in a creek just a few steps from their homes; the creek was dead, or nearly so, as was the sickly jungle around it.
Oro Sangama had another peculiar feature: There was a steady roar around it, like the sound of a giant flamethrower. Across the fetid creek stood a natural gas plant operated by Shell. The village was in the shadow of its largest flare, which shot into the air a plume of fire. As darkness fell, Sangama became illuminated by the flare’s reddish glow and remained lit in this fashion until the sun rose in the morning. The Martian light was deadly rather than helpful because the flare spews into the air a cocktail of toxic substances.
Soon I was greeted by King Tom Mercy, leader of the local Ijaw community. He wore a T-shirt and a frown. “This is where the oil and gas comes out,” he said. “They could give us water, give us light, give us scholarships, give us jobs. We would not quarrel with anyone again. We have tried everything, used lawyers and dialogue, and we see there is no way. The next thing is violence. We don’t care if everyone dies; we will burn it.”
Aboard his canoe the next day, we moved through mangrove creeks in which there was no screeching of monkeys, no hippos or crocodiles in the water, no butterflies floating in the air. Between the war and the pollution, this was both a dead zone and a killing zone. At some spots, the shoreline was shaved of vegetation and fenced off, to protect flares and pits that burned off excess oil and gas. The earth in these places was, quite literally, on fire.
This journey required, for comprehension, the imagination of a science fiction devotee. We passed a small island known as Little Russia. The origin of its name was not clear, but the island served a distinct purpose — it was where prostitutes lived, servicing the needs of soldiers and oil workers. On its shore, young women stood in the shade of shacks fronted with empty beer bottles and off-kilter picnic tables. The girls waved.
The smell of oil was strong, even when wells or flares were not visible. Where did it come from? I looked down and saw a film of oil on the river. At a flow station where fluids dripped into the water from a tangle of metal pipes that had the appearance of industrial art, a Shell sign said, “Keep Nigeria Safe and Clean.” The canoe stopped in front of six wellheads coated in oil that fell, drop by drop, into the water. If a match was thrown into the river, we would be engulfed in flames.
“How can we expect to catch fish?” King Tom asked.
His anger was no performance.
“Let’s go,” he ordered.
We soon passed a patrol boat with unsmiling soldiers.
“You see how we live.”
Houston
One evening I joined more than a thousand oil executives in a Houston ballroom that was large enough for a jumbo jet or two. The pinstriped diners were served plates of mixed salad, grilled salmon, and chocolate mousse by overworked waiters whose service was as gentle as cowboys heaving bales of hay to livestock. This was the gala evening of an annual oil conference at the Westin hotel. Drawn from across the globe, the men and just a few women in the chandeliered cavern constituted an oilpalooza.
The attraction on this February evening in 2003 was a chemical engineer from South Dakota. Since 1963 he had worked for just one company, eventually becoming its chairman and chief executive. He made everyone else in his hard-bitten industry seem gentle. He was gruff even to members of Congress and scoffed at global warming long after scientists proved it. Greenpeace called him the “Darth Vader of global warming.” He was superficially unappealing too, with a misshapen lip, an ample belly, and a set of jowls that cartoonists would judge absurd. But in the oil industry you do not need to be pretty or kind to succeed, and this oilman had succeeded beyond anyone’s imagining. Lee Raymond had turned ExxonMobil into the largest and most profitable corporation in the United States. He was rewarded with an astounding $686 million in compensation during his 13-year tenure as chief executive, which breaks down to about $144,000 a day, or more than $6,000 for every hour he worked, slept, ate, or golfed.
But Raymond was nearly unknown outside the environmental lobby that despised him, the financial industry that swooned over him, and the oil industry that feared him (Exxon’s executive suite was known as “the God Pod”). Think of the tycoons who are part of the contemporary lexicon — Gates, Murdoch, Buffett, Jobs — and realize that absent from their ranks is the man who oversaw one of the most profitable multinationals of the 20th century. I wanted to see him on this evening because he was not just at the highest echelon of his industry’s ruling class, but seemed its epitome.
After the mousse plates were cleared, Raymond lumbered onto the ballroom stage. The crowd offered a round of applause that was more akin to a handshake than a hug. In this industry, there was no need to feign love; grudging respect would do. His speech was an industrial mission statement. His listeners, who included ministers, princes, and CEOs, were reminded of how vital their work was, how underappreciated they were, how they must labor harder than ever, how the future will be grander than the already-blessed present. A video screen enlarged Raymond’s presence to superhuman proportions. It was part Tony Robbins, part Billy Graham, with a whiff of a mumbling Leonid Brezhnev.
Invoking a sacred industrial purpose, Raymond recited his version of the inspirational commandments of the oil world:
“We all have a tremendous opportunity and a responsibility to improve the quality of life the world over. Virtually nothing is made without our energy and our products.
“Our industry’s best years lie ahead, surpassing even the greatest achievements of the century gone by.
“We condemn the violation of human rights in any form and believe our stand on human rights sets a positive example for countries where we operate.”
The audience’s reaction was ritualized, less a genuine wave of applause than an obligatory simulation. I was reminded that in this brutal business, it was best to save your enthusiasm for crushing a rival rather than congratulating him.
Venezuela
Venezuela, which has the world’s seventh-largest oil reserves, is a classic example of what economist Joseph Stiglitz calls “a rich country with poor people.” Caracas, the capital, is surrounded by coils of barrios; voters from these impoverished areas are the electoral base for President Hugo Chávez, who promises to create true prosperity from the oil riches. I stopped by Miraflores, the presidential palace, to see how Chávez was performing the trick that eluded so many of his predecessors.
The Miraflores event was part of the great game of our times — the superpower search for steady supplies of energy. China, which didn’t import much petroleum until 2000 yet is now the second-largest importer after the United States, was doing whatever it could to win the friends and resources it needed. To woo Caracas, China had just agreed to help launch a communications satellite on favorable terms. In a conference hall at the palace, Chávez was getting ready to break this news to the world. Onstage, several executives from the China Great Wall Industry Corporation sat beside the stout Venezuelan president.
After the Chinese and Venezuelan anthems were sung, Chávez launched into a speech of the sort that is his trademark — a presidential stream of consciousness. He congratulated the Chinese for being clever at math and saluted their women for being so beautiful. He thanked the Chinese government for training Venezuelans in satellite technology, saying they were teaching Venezuela “how to fly.” As a visual aid, he flapped his arms like wings. He added that the Chinese had learned to fly under “the great Mao Zedong,” and because Chávez drew inspiration from Mao’s one-party, one-truth pedigree, he smiled broadly and exhorted, “Long live the Chinese revolution!”
The Chinese businessmen, as rigorously mercantilist these days as John Rockefeller was in his time, gazed at Chávez. They didn’t seem to know whether the desired response was sardonic smiles or clenched fists, but their expressions veered toward the safe harbor of nodding approval. One of them adjusted the volume on his translation headset as Chávez said, “We don’t want to earn money out of this. We’re not capitalists. This is about the survival of our country and the destruction of capitalism. Capitalists are generating death!”
Yet capitalists are still buying oil from Venezuela, and lots of it; most of Venezuela’s oil exports go to the United States. A president can flap his arms in Caracas and hold his nose at the United Nations and promise to remake his nation, but reality is crude in many ways. There is a saying that Venezuela does not have good or bad presidents, just presidents who serve at times of high or low oil prices. Chávez, running for president in 1998 as the main political parties all but collapsed from decrepitude, had the great luck of being elected when oil sold for $12 a barrel. As his presidency began, prices started climbing, on their way to more than $140 by 2008. Venezuelans had seen this before — presidents who became popular by increasing public spending and who became unpopular when the oil boom ebbed. Chávez’s announcement at Miraflores — indeed, his entire presidency — had the feel of what Venezuelan scholar Fernando Coronil described as a state limited to “magic performances, not miracles.”
Magic can obscure reality but not make it disappear.
Saudi Arabia
When our paths crossed, Mohammed Ibrahim Abdul Aziz was 20 years old. He seemed young for his age — his sparse facial hair gave him the look of a teenager. He had studied at King Saud University in Riyadh but had not been inspired by his teachers and had not been hopeful of finding work after graduation. The paradoxes of Saudi Arabia include the fact that it has oceans of oil but not an economy that offers jobs its citizens want. This is one of the problems of the oil industry: It generates lots of cash but very little work. Mohammed dropped out of school and like many Saudi youths spent his spare time cruising the Internet. When I asked which fundamentalist Web sites he’d visited, Mohammed couldn’t remember precisely because there were so many, all extolling the glory of doing battle against infidels.
I met Mohammed in Samarra, Iraq, where he had gone to fight Americans in 2005. He had been captured a few days before our encounter, and he had certainly seen better days. He was wearing a green frock covered in mud and his eyes were bloodshot. He had been interrogated almost nonstop. A soiled bandage was wrapped around his head; he said he was injured when the car he was traveling in, with two members of his insurgent cell, was attacked by Iraqi soldiers. It was just as probable that he had been roughed up but did not want to say so. We talked in an office in a library that had been converted to a detention center. A desk in our midst had bloodstains down its side. From parts of the detention center I was not allowed to visit, I could hear prisoners screaming and retching.
Mohammed’s career as a holy warrior had lasted a few weeks. He had no skills to offer the insurgency because he had never fired a weapon or built a bomb, did not know his way around Iraq, and could not even blend into a crowd because his Saudi accent gave him away. When he realized his insurgent cell was led by a man who seemed more interested in stealing cars than killing Americans, he wanted out. His capture came as a relief, which is why he had not been tortured to the edge of death — he was more than happy to tell everything he knew.
“I made a mistake,” Mohammed said. “I just hope I will be allowed to go back to Riyadh. I want to leave.”
He would not be going home soon. A U.S. military advisor, dressed in jeans and with a pistol strapped to his thigh, was monitoring my talk with Mohammed. The Iraqi who interpreted, also with a pistol on his hip, was an overweight police official. The Saudi, the American, and the Iraqi in this room were in a deep mess, as were their homelands. There were many reasons, and a core one was evoked when Mohammed ventured a guess as to why Iraq had been invaded.
“The Americans want to control Iraq’s resources,” he said. “They came here for oil.”
