Deep in the innermost recesses of the capitalist establishment, a decision has been made by the oil monopolies, in concert with the Bush administration, to open a general assault on the vast oil fields of the former Soviet Union.Chevron, one of the largest of the oil monopolies, is leading the charge. A New York Times headline (May 19) tells us that Chevron is to spend $10 billion to seek oil in Kazakhstan in the form of a joint venture development. The revenues, we are told, could go beyond $5 billion a year. About 80 percent of the income, minus royalties and taxes paid by Chevron, would go to the Kazakhstan republic.
Chevron will explore and develop the Tengiz oil field, one of the largest in the world--some say as large as Prudhoe Bay in Alaska.
Ten billion is a considerable sum, even for a giant like Chevron. But we read further on that the investment is to stretch over a period of 40 years. This means $250 million a year--not as attractive as $10 billion.
Nor is Chevron obligated to invest any money. It is "called upon" to invest. There's no obligation to put any cash on the oil barrelhead. So what is real about the contract?
No legal authority
Chevron executives say that Kazakhstan officials will guarantee the deal, but "The new country is just now enacting a constitution." Thus we learn, in an aside, that there is no constitutional provision allowing the oil fields to be rented, leased, developed or exploited in any way. This new "democracy" has taken upon itself to either grant or lease the most valuable asset of the republic without the sanction of any law.
This is to be the model for all the republics of the former Soviet Union. In the final analysis, it's no better than the old-style neocolonialist arrangements imposed by the imperialists on so many countries of the Third World. In fact, care used to be taken to make sure that any deals imposed by the imperialists were in accordance with a constitutional provision. Here none exists as of yet.
That means that Nureyev nur-Sultan Nazarbeyev, the president of Kazakhstan, has taken this rash act without even having consulted the parliament, which in any case could only act in such serious matters in accordance with the constitution.
Over the many years of existence of the large oil monopolies and cartels, especially the Seven Sisters--Exxon, Texaco, Mobil, Gulf, Socal (the last two now merged into Chevron), British Petroleum and Dutch Shell--most agreements have been kept secret, except for bare, innocuous general statements. One wonders why the details of this particular deal seem to be more open.
This is not an attempt by a single oil company to take upon itself a joint venture with the Kazakhstan republic after all the other oil giants have held back. The announcement of this deal is an undeviating sign that a broad cartel agreement has been reached to open a general offensive by the oil monopolies.
The history of the oil giants, beginning with the Rockefellers and down to this very day, shows that they would indeed devour each other in competitive struggles were it not for the restraining effect of knowing that such predatory wars could lead to their mutual destruction. Nevertheless, they are able to maintain loose coalitions and maintain themselves as the premier industry of the U.S., the first and most important in the structure of American finance capital.
Bush, himself a member of an oil dynasty, can scarcely afford to be aloof from any such internationally significant deal as the one with Kazakhstan. It is to be noted that the deal was signed not in Kazakhstan, nor in the general offices of Chevron, but in Washington.
Who controls the world's oil?
This deal comes in the midst of a worldwide intensification of the struggle between, on the one hand, the U.S. and British imperialists, assisted by the Dutch, and on the other the German and Japanese imperialists. After more than 100 years of struggle and two world wars between these two rival imperialist camps, the end result thus far has been that a U.S.-British alliance, with assistance from The Netherlands, owns and controls the oil resources of the world.
That's a blunt fact. Yet all those who cry about the poor position of the U.S. vis a vis industrial and technological competition with German and Japanese capitalism rarely care to comment on it or put it in perspective.
It is true that the French have developed some interest in the petroleum industry, but it is minimal by comparison with the lion's share controlled by the Anglo-U.S. group. It is true that the Japanese have ascended to the position of premier financier.
It is also true that the Germans have made greater technological progress in the last decade or so than one might have expected, given the former division of Germany. But German reunification, under the present conditions of capitalist decline and an extraordinary militancy in the labor movement, does not augur well for the German bourgeoisie.
The likelihood is that German capitalism may well get bogged down by its heavy commitments. Disappointment has set in at the elusiveness of those easy dividends which had been anticipated from rapprochement with the Gorbachev regime and accessibility to the market of the former USSR.
This is now being challenged by the U.S. It is lining up the counterrevolutionary leaderships in one republic after another in an effort to galvanize them into a solid bloc. The U.S. financiers and industrialists hope to erect a warning sign at the entrance to each of the republics, especially for the benefit of German and Japanese imperialism: "These territories occupied by the U.S."
Ideology and material interest
Too often the struggle between imperialism and the socialist countries has been viewed as fundamentally an ideological one, as though there were no material basis to it whatever. The struggle of the imperialist bourgeoisie to destroy the USSR did indeed begin on day one of the October Revolution. But imperialism had had a vital overriding interest in old czarist Russia. This material interest grew more and more important, indeed imperious, as time went on and the Soviet Union made more and more progress.
Nothing is more enticing to the imperialists than the oil.
"The politics of the Soviet Union might well have a major impact on world energy in the years immediately ahead. The USSR is the world's largest producer [of oil], with output in 1989 more than double that of Saudi Arabia, and it is the world's second largest exporter after Saudi Arabia. Time after time in years past, the fortunes of Russian oil have had significant global impact, beginning in the 19th century when the development of an oil industry in Azerbaijan around Baku broke the global grip of Standard Oil and indeed the monopoly of western Pennsylvania." (Daniel Yergin, The Prize, Simon & Schuster, 1992)
From this the reader should gather that the imperialists were interested in the destruction of the USSR not solely for ideological reasons (for "god, democracy and family") but for crude, predatory profit in an area of extraordinary wealth in natural resources, particularly energy: natural gas, oil and coal.
Hence, the agreement with this turncoat communist, nur-Sultan Nazarbeyev. The contract is carried out with a view toward public relations, here and especially in Kazakhstan. On the surface it appears to be all generosity on the part of Chevron. Chevron is granting $10 billion up front. But reading further down, it's over a 40-year period. That's not exactly putting your money where your mouth is.
Soon they hope to have maps that reflect the same dominion they exercise in the Middle East. "In the Middle East, there were two kinds of maps, some showing the names and outlines of the nations, most of them comparatively new, and others showing the region cut up into squares along the coast marked with initials--IPC, KOC, ARAMCO, and AOC--representing the consortia of oil companies, nearly always including some of the Seven Sisters." (Anthony Samson, The Seven Sisters, 1991 rev. ed., Bantam Books)
Chevron is pushing for the construction of a 400-mile pipeline from Grodzny to Novorossisk on the Black Sea. Most of the oil, according to the general manager of Chevron's Tengiz venture, "would eventually be exported to Europe and the Mediterranean." For the first five years it will go to the states of the former Soviet Union. But over time, most of it is destined for Europe.
Kazakhstan got the oil minister from Oman to advise them on how to deal with the U.S. The Soviet Union has been a chief oil exporter for 70 years and has accumulated considerable experience. Why did they suddenly need an adviser?
Raising oil and gas prices
We learn in the same article that Boris Yeltsin signed a decree to raise the domestic price of oil and natural gas fivefold.
Let's suppose a gallon of oil used to cost $1. If the price is increased to $5, what effect will this have on the economy? Will it expand or will it contract?
One can easily understand why the imperialists are for the USSR raising the price internally. It will contract the economy. A smaller economy is much more desirable from the imperialist point of view.
It will help make the former USSR an importer of consumer goods. Cheap energy prices would facilitate its own production of goods like plastics, for instance, which are made of petroleum. But once they cost more, then people will use fewer homemade plastics. The imperialist exporters will have a clearer field.
But what earthly good does it do for the public or the state, such as it is?
Raising the export price of oil is another demand the imperialists have been making. If the republics raise the price abroad, then of course it won't be lower than that of the imperialist oil monopolies.
The USSR produced 11.7 million barrels of petroleum a day in 1990. That fell to 10.3 million barrels last year. As matters stand now, oil exploration worldwide is picking up. There is no great scarcity of oil production or reserves. Together with the increase of energy from other sources, there is not only abundance but an actual glut. All the scare stories of the 1970s about a shortage of energy have dissipated since the tremendous increase in oil exploration and reserves.
Yes, there's a very great need worldwide for clean energy resources, but the lion's share of the energy resources is controlled by the imperialist countries.
What makes them hesitate
The formidable problem the U.S. imperialists face is of course what they call the continuing instability in the republics and their mortal fear that if they overstep their bounds too soon, they may revive the revolutionary struggle and be unceremoniously ousted. Hence, their protracted hesitation.
But then they have to reckon with the possibility that the German, Japanese, and to a much lesser extent French, Italian and other European imperialists will beat them to it. The vast territory that was the USSR is by far the largest, richest market in the world. Over 70 years of socialist construction has enormously facilitated the extraction of gas, oil, gold, diamonds--you name it.
The problem facing the U.S.-British-Dutch consortium is that while they want to overcome their hesitation and get a secure hold on this market, they are nevertheless constrained by the marauding world capitalist economic crisis. It dictates that this is a period not for expansion but for contraction.
At home they are promoting an economic policy of cutbacks and layoffs. They extract the sweat and blood of the workers worldwide. But it all may be insufficient in their gamble to get the fruits of a counterrevolution that may still be reversed.