The latest news involving Iraqi reconstruction revolves around just one word: oil. (Reported on Informed Comment) Both UK newspapers, The Independent and The Guardian, published stories today about recent foreign oil company deals with Iraq. The articles discuss the new contracts negotiated by Exxon Mobil, Total, Shell and BP (amongst others) for “repair and technical support.” The contracts are not long-term (only two years) and do not include the full set-up for drilling and exploration. However, there are insinuations, and even some flat-out comments, that the companies are using these agreements as a “stepping-stone” for future, more lucrative contracts. Both British authors compare this latest development to the western exploitation of Iraqi oil following the post-WWI creation of the Iraqi state (for more historical background, click on Informed Comment or The Independent.) Essentially, these stories have turned oil companies into the McSinisters of the world (not that I completely disagree with that right now).
The Washington Post , The New York Times and USA Today also reported on the new contracts. They state that foreign investment means that Iraq is finally on track with its security and reconstruction efforts, while implying that the US is doing its job in reducing violence and improving Iraqi government and infrastructure. USA Today's version of the continuing oil saga is particularly interesting. Entitled, “Hope arises for Iraqi oil production,” this article views the same story in a completely different way than that of the Brits. Quoting a Basra councilman, author Charles Levinson describes the return of the oil companies as Iraq's “wish.” Here, we are led to believe that the oil conglomerates will save the day (more specifically, Iraq's economy).
The US media is claiming that these contracts would propel Iraq into modernization, and more importantly, wealth. But does this really mean wealth for Iraqis? Or just more for the oil companies? As The Guardian, The Independent and The New York Times all state, these oil deals are making Middle Easterners nervous that getting our hands on their oil was the US government's goal all along. And of course, the latter group of articles include Iraqi oil output in the discussion about alleviating gas prices in the US, something that Americans are desperate to hear right now. I don't have a strong background in economics, but I have to ask: with the exponential increase in consumption by China and India, is a 4% addition to the global supply really going to lower prices for the next six months, one year, five years?
We’ve all seen it a thousand times before: one set of facts, ten different stories. That's just how the media works. But I’m always left wondering, who should we listen to?
