OK, SO LET’S DISPELL THE MYTH OF OIL FROM IRAQ:

Via Dennis Gartman:

We grew weary of explaining to the Left… and far too often to the Right… why the War in Iraq was not fought by the US for energy purposes, for as we euphemistically said in speech after speech after speech, the US got very little crude oil from Iraq when compared to its other suppliers, while in fact France got a much larger percentage of its total oil requirements from Iraq, and so too did Germany.

Back in ’03, for example, prior to the War, the US got approximately 5% of its oil imports from Iraq, while back then the US got 15% of its oil imports from that war-like state to our north, Canada, and got 12% from those vicious Mexicans to our south [Ed. Note: We are of course speaking tongue-in-cheek here, so to our friends in Canada and Mexico, please bear with us; we need to make a point here to everyone else. We at TGL know all too well how dependent we are upon our true friends in Canada and Mexico if few other Americans do.].

Even now, we are hardly dependent at all upon Iraqi crude oil, for as of September Iraq ranks behind Algeria, Nigeria, Saudi Arabia, Venezuela, and of course Canada, and it is barely ahead of “mighty” Ecuador, with Brazil having ranked ahead of Iraq several times in the past six months but having ranked below Iraq in August and September ...

Even more interesting, however, are the results from recent oil lease auctions in Iraq, which one would think that the US would “win” rather easily if the War effort there had been fought solely to win Iraqi crude oil, wouldn’t one? Wouldn’t one reasonably expect that the auctions would be properly rigged in order for the US to win more than its share of Iraq’s crude oil if the war was fought for Iraqi crude? One would be wrong, however, for in these recent auctions the US was effectively shut out.

Exxon Mobil was the only US company that lead a winning bid team in the recent auction, winning the right to develop Iraq's West Qurna 1. Oh, and we will acknowledge that Occidental Petroleum ended up as a “junior partner” in another winning bid, but on balance the US lost, lost and lost again in the bidding.

When then were the winners: Well, Royal Dutch Shell won the right to operate the Majnoon field. The Majnoon has a production target of 1.8 million bpd, and Royal Dutch Shell’s joint bid gets it 45% of that total. Malaysia's Petronas joined Royal Dutch Shell and “won” 30%, with the rest kicked down to more and more minor partners none of which were American.

Moving on, Petronas was again successful, along with CNPC of Hong Kong and France’s Total to develop the Halfaya oil field that is expected to produce just over half a million bpd. Again, no US companies were involved. Oh, and Russia’s oil company Lukoil was busy, joining with Norway’s Statoil to develop the West Qurna 2 field, whose target is 750,000 bpd.

Were any US companies involved in that bid? None; zero; nada. Zilch. CNPC and British Petroleum joined to win control of the huge Rumaila oil field that has reserves of 17.8 million barrels; again, no US companies were involved. Angola, where the OPEC summit will be held tomorrow, who bid in the auction via its national oil company Sonangol, won the right to the Qayara oil field and the Najma oil field, whose combined “target” shall be 230,000 bpd. Was there any US participation in Angola’s bid? Nope! Then Brazil’s Petronas and Japan’s Japex won the right to develop the Gharraf oil field; Russia’s Gazprom, joined with Turkey’s TPAO, S. Korea’s Kogas and Malaysia’s Petronas to jointly win the right to the Badra field, whose target is a smallish 170,000 bpd. Again, there were no US participants.

Yes, these were auctions, but this was and is Iraq where corruption is rampant. If the US defeated Saddam Hussein solely to gain access to Iraqi crude oil, wouldn’t one reasonably think that the governments would have rigged the auctions so that the US could take Iraq’s crude cheaply, effectively and quickly? Certainly we would think so, but the auction results would seem to suggest otherwise. But then again, what do we know?