Peak Oil, Missing Oil Meters and an Inactive Pipeline:
The Real Reason for the Invasion of Iraq?


In this article I will present research that supports a rather startling hypothesis: that the USA invaded Iraq primarily to enable the secret diversion of a portion of Iraq’s oil production to Saudi Arabia. This was done in order to disguise the fact that Saudi Arabia’s oil output has peaked, and may be in permanent decline.  The evidence for this conclusion is circumstantial, but it does knit up many of the loose threads in the mystery of the American administration’s motivation for invasion.

To lay the groundwork we need to set out a couple of assumptions.

The primary assumption is that the world’s oil production has been on a plateau for the last two years, and in fact we may be teetering on the brink of the production decline predicted by the Peak Oil theory. Such a decline could be dangerous to the world economy, both directly through the loss of economic capacity and indirectly (and perhaps more importantly) through the loss of investor confidence in the global economic structure.

The second assumption is that the oil production of Saudi Arabia is key to maintaining the global oil supply.  Saudi Arabia supplies over 10% of the world’s crude oil, with over half of that coming from one enormous field named Ghawar.  There is a large and well-informed body of opinion that believes that if Saudi oil production goes into decline the world will follow because there is not the spare capacity anywhere else to make up for such a decline.  Saudi Arabia is notoriously tight-lipped about the state of their oil fields, and in fact oil production information is considered to be a state secret. The only trustworthy information the world really has about Saudi Arabia’s oil are their aggregated production figures.

The conclusion that can be drawn from these two assumptions is that if Saudi Arabia’s production began to decline and the world found out about it, there would be a significant risk of a world-wide economic panic that would destabilize markets and throw nations like the USA into a recession or depression that would be worse than the actual damage done by the loss of the oil.  We can assume that the prevention or postponement of such a crisis would be an extremely high priority for the administrations of both the USA and Saudi Arabia.

The Evidence

Cheney’s Energy Task Force Meetings

These meetings have long been a bone of contention with the Bush administration.  They have gone to extraordinary lengths to keep the subject of the meetings absolutely secret.  These efforts are documented by such sources as and

We do know the following:

The Iraqi Oil Ministry

It is well known that the Iraqi Oil Ministry was the only major government installation guarded by American troops following the fall of Baghdad.  Indeed it was guarded extremely well: according to an April, 2003 news story at

Since US forces rolled into central Baghdad a week ago, one of the sole public buildings untouched by looters has been Iraq's massive oil ministry, which is under round-the-clock surveillance by troops.

The imposing building in the Al-Mustarisiya quarter is guarded by around 50 US tanks which block every entrance, while sharpshooters are positioned on the roof and in the windows.

The curious onlooker is clearly unwelcome. Any motorist who drifts within a few metres of the main entrance is told to leave immediately.

Baghdad residents have complained that US troops should do more to protect against the looters, most of them Shi'ite Muslims repressed by Saddam Hussein's Sunni-dominated regime who live in the vast slum known as Saddam City on the northern outskirts.

But while museums, banks, hotels and libraries have been ransacked, the oil ministry remains secure.

The ostensible reason for this extraordinary focus was to protect Iraq’s primary asset.  Indeed an American captain is quoted in the article as saying, "Anyone who says we're protecting this ministry to steal Iraqi oil doesn't know what's really going on in this country."

The Mystery of the Oil Meters

On March 22, 2007, CorpWatch published an article entitled “Mystery of the Missing Meters: Accounting for Iraq's Oil Revenue” ( In it they make the following claims:

The Pipeline

Now we’ll look at that pipeline on those Energy Task force maps.

The Iraq Petroleum Saudi Arabia (IPSA) pipeline was built during the Iran-Iraq war to circumvent attacks by Iran on Iraqi tankers in the Gulf. It has a capacity of 1.7 million barrels per day and runs from Iraq's southern oil fields to the Saudi port of Yanbu, north of Jeddah.   It later served both Iraq and Saudi Arabia, but has been closed by the Saudis since Iraq’s invasion of Kuwait.  The Saudis claim ownership of the pipeline, though Iraq disagrees.

The pipeline was reported ready to resume operation in September, 2003 ( ). One month later in October however, we heard this (from ):

20-10-03 The 1.7 mm bpd crude pipeline which runs from Iraq across Saudi Arabia to the Red Sea is in no condition to be utilised for Iraqi exports. When asked about reports that Iraq was in discussions with Riyadh to re-open the line, a Saudi Aramco official said that the Iraqis "don't know what they are talking about. The pipeline is not in a state to be utilised."

So is it usable or isn’t it?  I can’t find anything except this denial to indicate that it’s unserviceable, though a State Department presentation ( ) indicates that it’s closed with no plans to re-open.  I can find no evidence of insurgent attacks against it, so there is at least some possibility that it is running.

Saudi Arabia’s Oil Production History

Saudi Arabia’s oil production has been deliberately increased and decreased over the years in like with their role as the world’s “swing producer” – a country with enough capacity to open the taps to keep prices from rising too high and the political discipline to restrict production if prices fell.  In the period from 2001 to the end of 2003, this “price band” was set by OPEC at $22 to $28 per barrel.  At the beginning of 2004 oil prices moved above this band, and have never returned to it.  This seems to indicate that OPEC members, and particularly Saudi Arabia, don’t have the excess capacity that would be required to bring the prices back within the traditional band.  The suspension of the price band in 2005 seems to be in recognition of this new market reality.

Saudi Arabian Oil Production

This graph of Saudi oil production is very interesting. It clearly shows the fluctuations in supply during 2002 and 2003, presumably attributable to their role as a swing producer.  At the beginning of 2004, however, something very curious happens.  There is a very rapid rise in production of 1.3 million barrels per day over the course of two months.  This production level is maintained with only one small dip (which may indicate the temporary influence of production from the new Haradh III oil field) until the beginning of 2006.  At that point a decline sets in that has not yet been arrested, resulting in a fall of 8% over the last year.  This decline has been validated by four independent sets of data, as described here:

Pulling it All Together

Existing Hypotheses

I have never been entirely satisfied with the unofficial explanations for the Iraq war.  I do accept (as does this article) the idea that the war was somehow “about oil,” yet none of the existing explanations for why that should be so are terribly convincing.  The United States could have achieved significant influence over the disposition of Iraqi oil through standard diplomatic and commercial means, without the expenditure of so many lives and so much money.

One hypothesis advanced by Canadian journalist, Linda McQuaig, in her book “It’s the Crude, Dude” argues that the US invaded to acquire the “carrot and stick” of oil ownership and sales rights in order to be better able to reward friends and punish its enemies, thereby shaping regional and global power structures.  To me this seems a costly, indirect and ineffective mechanism, especially if the global oil supply is unconstrained and nations can buy from whomever they wish.

Then there is the hypothesis that invasion was staged to permit western oil companies (particularly those with close ties to the Bush administration) to take control of the fields and reap windfall profits.  This speculation also comes up short in my opinion. Those oil companies were already doing very well. An invasion and occupation are very risky ventures, and are intrinsically unlikely to provide the stable environment required for a simple transfer of commercial control (neo-con dreams of flowers, candy and regime change notwithstanding).  The costs seem entirely out of proportion to the potential rewards.

The “Purloined Letter” Hypothesis

The speculation of this article is that the real background of the Iraq war goes something like this:

  1. It arrives at the Saudi port of Yanbu where it is loaded onto tankers as legitimate Saudi oil, and shipped to international customers.  There is a problem with this scenario, because the oil coming in from Iraq has a slightly different chemical signature from Saudi oil.  This small difference would be noticed by customers, because the refineries need to know the characteristics of their feedstock very precisely.
  2. A more reasonable solution is that this oil is piped to refineries in Saudi Arabia and is used to satisfy domestic demand.  The Saudi oil spared by this substitution is shipped out to customers, and no one is the wiser.  This is both safer and easier than the first suggestion, because the stolen oil never leaves Saudi Arabia, and its disposition falls under the obscuring veil of Saudi secrecy.  This also makes the case harder to prove, of course.


There is as yet no smoking gun to support this hypothesis.  This remains a work of pure speculation, based on a suggestive convergence of events and incidents.  The one feature of this hypothesis that makes it attractive is the extent to which it can accommodate all the odd and otherwise inexplicable events of the last six years.  On the other hand, it can be accused of suffering from the common failing of conspiracy theories: it would take too many people to implement.  The argument against that is that these events have demonstrably occurred and the binding element of the hypothesis, the peaking of Saudi oil production, would not require that many people to be aware of it in order for it to provide sufficient motivation for such a devious scheme.

I would welcome any additional thoughts or suggestions of evidence on this scenario.  I would especially like to hear of any evidence that would falsify the hypothesis – particularly evidence of the (in)operability of the IPSA pipeline.

© Copyright 2007, Paul Chefurka

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