Oil and Power After the Gulf War

Oil and Power After the Gulf War Robert J. Lieber w h a t are the implications of the Gulf War for the world oil market and for global energy security? On initial examination, there would seem to be little cause for concern, and no fewer than three separate factors contribute to such a conclusion . First, the devastating defeat suffered by Iraq suggests that both past and future militarythreats can be minimized. Second, the successwith which producing and consuming countries managed to cope with the purely oilrelated components of the Gulf crisis suggests that both the supply and the price of petroleum are manageable. Third, regardless of policy choices made by these countries, elasticities of both supply and demand appear to insure that world energy markets can and will cope with potential disruptions. However, an assessment of oil and power in the aftermath of the Gulf War provides evidence for concluding that the risks were in fact very substantial and that avoidance of serious upheaval was by no means inevitable. This interpretation rests not only on analysis of the Gulf crisis itself, but also on the lessons of the two o i l shocks of the 1970s, as well as on experience from the following decade. In this light, each of the three arguments above proves less reassuring. In the military realm, the extraordinary victory of the American-led coalition in an air war lastingjust over five weeks and a ground war of 100hours has given rise to a virtual consensus on both the invincibility of the coalition and the inevitability of its triumph. However, cases both old (the debacle of Australian and other British Empire forces at Gallipoli against the Ottoman Turks in 1915l) and more contemporary (the failure of Desert One, the Robert 1, Lieber is Professor and Chairman of the Department of Government at Georgetown University. His most recent books are No Common Power: Understanding International Relations (HarperCollins , 2d ed., 1991),and Eagle in a New World:American Grand Strategy in the Post-ColdWar Era, co-edited with Kenneth Oye and Donald Rothchild (HarperCollins, 1992). An earlier draft of this paper was presented at a conferenceon “Iraq Under the Ba’ath,” Haifa University, May 27, 1981. I would like to thank the partiapants there for comments. 1. A brief account of the Gallipoli expedition and debacle can be found i n David Fromkin, A Peace to End A 1 1 Peace: The Fall of the Ottoman Empire and the Creation of the Modern Middle East (New York Avon, 1990), pp. 150-187. For a comprehensive treatment, see Alan Moorehead, Grzllipoli (New York: Harper and Brothers, 1956). lnfernutwnalSecurity, Summer 1992 (Vol. 17, No.1) Q 1992by the President and Fellows of Harvard College and of the MassachusettsInstitute of Technology. 155 International Security 17:l I 156 American effortto rescue the Iranian-held hostages in April 19802),and even the ambiguous consequences of Israel’s 1982 war in Leban~n,~ suggest that the triumph of the forces of modern or Western powers over those of less technically-advanced Middle Eastern regimes cannot simply be taken for granted. Moreover, timing proves to have been crucial. Had Saddam Hussein’s forces promptly followed their August 2, 1990, invasion and occupation of Kuwait by a drive into Saudi Arabia, the Saudis and Americans would have lacked the military means to stop the hundreds of thousands of troops and the thousands of armored vehicles under the command of the Iraqi dictator. At best, this might have triggered a longer, less successful, and far more costly war. At worst, Saddam might have controlled the Saudi Gulf Coast ports and major Saudi oilfields, leaving the United States with two unwelcome options: to mount a military campaign without the benefit of the Saudi ports and facilities and to risk the kind of destruction later seen in Kuwait on a still vaster scale against the oilfields of Saudi Arabia, or to acquiesce in Iraq’s control of almost half the world’s proved oil reserves, as well as the likelihood of Saddam’s domination of the remainder of the Gulf oil producers. The cutoff of Kuwaiti and Iraqi oil from world oil markets was managed, but with...