gary's choices

An Iran-Iraq clash over oil?

By Gary Sick

One of the most serious criticisms of the U.S. invasion of Iraq was that it eliminated the last remaining nation in the Persian Gulf capable of balancing the power of Iran. The Taliban, Iran’s major enemy to the east, had been eliminated earlier, and the overthrow of the Saddam Hussein regime, which had fought a brutal eight-year war against Iran, completed the process. As a special additional gesture, the U.S. occupiers oversaw the creation and installation of a Shia government, many of whose members had sheltered in Iran during the dark years of Saddam’s rule.

American officials who presided over this radical power shift in the Gulf insist that they had no intention to lift Iran to a more prominent position of regional influence. However, that is exactly what happened; and the effects were so striking that Saudis and others speculate in private that the United States intends to set up Iran as the new Gulf power. That may seem less absurd when you consider the intimate U.S. relationship with the shah in the 1970s and the anomaly of secret U.S. arms sales to the ayatollahs (the Iran-contra affair) during the Iran-Iraq war in the 1980s when we were ostensibly backing Iraq.

Conspiracy theories aside, the Arabs have some reason to be dismayed about Iran’s dramatic rise in influence that was engineered, however inadvertently, by the George W. Bush administration. Today it is common to hear Gulf Arabs complain that Iraq is a wholly owned subsidiary of Iran; that Iraqi prime minister Maliki is merely the handmaiden of Iranian supreme leader Ali Khamenei; that firebrand Muqtada al-Sadr and his popular legions take their orders directly from Qom; that Iran is planning a takeover of the rival religious center of Najaf in southern Iraq; and that nothing happens in Iraqi internal politics that does not have the fingerprints of Iran all over it.

The real test of Iranian influence, however, will come only when there is a direct clash between the fundamental national interests of Iran and those of Iraq. That moment may almost be upon us.

Iran is facing a moment of high drama this summer. The West refused even to consider lifting or delaying sanctions in the three rounds of nuclear talks in Istanbul, Baghdad and Moscow. The United States and its five partners seem to believe that Iran is unable to retaliate in any significant way, so they can with impunity take an unyielding line to force Iran to concede.

Iran’s real weapon of mass destruction is the price of oil. Not only does a price increase improve the value of a barrel of Iranian oil, but it also places new strains on vulnerable economies from Europe to Japan. Earlier this year, Iran was able to push oil prices up by some fifteen percent simply by blustering about closing the Strait of Hormuz and verbally challenging U.S. naval forces in the Gulf. They could once again raise the temperature this summer with some war games in the strait or by playing chicken with U.S. naval ships. But at a time of high oil production and reduced demand, that might be insufficient. At least that is what the Obama administration seems to believe.

If Iran decides to go beyond mere bluster, how can it actually remove barrels of oil from the Persian Gulf pipeline? There are at least two broad strategies.

First, Iran could use its considerable cyber warfare capabilities to try to interfere with the computer-managed oil production of its neighbors across the Gulf. The United States and Israel have used cyber warfare techniques to interfere with Iran’s nuclear infrastructure. Could Iran employ the same methods – raising suspicions but leaving no fingerprints? This is terra incognita. It is impossible to be sure how an Iranian cyber-offense might play against an Arab defense, but it would be foolish to discount the possible threat.

Another approach could be sabotage. Iran has had years to place sleeper cells into Arab oil fields, a process made somewhat easier by the fact that most of the oil in the Gulf has Shia populations residing above it.

Perhaps the easiest target of all, however, would be Iraq, where Iran has well-established relations with Shia militias in the oil-rich south. This could be the acid test of the Iran-Iraq relationship.

Iraq is on the verge of surpassing Iran as the number two oil producer in OPEC, an event that is certain to be immensely embarrassing for Iran’s ambitions to be the dominant power in the Persian Gulf. It is also a critical moment for Iraq’s self-image as a self-reliant sovereign state. If Iran should choose this moment to interfere with Iraq’s hard won and desperately needed oil production and sales, it would be placing its own national interests ahead of Iraq’s. Would Iraq acquiesce?

I have no doubt the answer would be no. Even my own limited experience with Iraq convinced me that Iraqis are Iraqi first and Shia second. The conventional wisdom that post-invasion Iraq is the plaything of Iran is simply wrong. And Iran probably knows it.

A clash is coming between these two historical rivals in the Gulf. Will it happen this summer? The choice is up to Iran.