If you’ve ever wondered why all the angry political rhetoric about high gasoline prices has so little effect when you’re paying around $4 a gallon, give a read to Steve Coll’s incredibly well-researched book, Private Empire: ExxonMobil and American Power.
At numerous points in the 685-page exposé of the largest U.S. energy company, Coll makes clear how ExxonMobil puts its interests behind no others, including those of the American public.
“I’m not a U.S. company and I don’t make decisions based on what’s good for the U.S.,” former ExxonMobil CEO Lee Raymond says on page 71.
“Energy made in America is not as important as energy made simply wherever it is most economic,” Raymond’s successor, Rex Tillerson, says on page 246 as he dismisses the idea that the United States needs to become less reliant on foreign oil.
And as the new Obama administration in 2009 met with oil companies to gauge their interest in addressing climate change by moving toward cleaner energy, one adviser described ExxonMobil’s attitude as “being firmly fixed in the ‘Fuck you, no apologies, oil-is-here-to-stay mode.’” (page 541).
The bottom line for ExxonMobil – as it was for BP leading up to its disastrous spill in the Gulf of Mexico and as it has been for Big Oil since John D. Rockefeller’s days at the Standard Oil Co. – is that shareholders and profits always come first. Even U.S. national-security interests don’t matter much if ExxonMobil needs oil resources to keep its reserves ahead of its outflow – a critical factor in maintaining a global oil company’s stock value.
In the West African nations of Chad and Equatorial Guinea, ExxonMobil pressured the U.S. government to maintain ties with repressive regimes in order to protect its access to lucrative oil and gas fields. In Iraq, ExxonMobil signed agreements to develop Kurdish oil fields despite fears in the Obama administration that doing so would infuriate Iraq’s Shia-led government. After the deals were reached prior to getting U.S. approval, Tillerson told State Department officials in a conference call, “I had to do what was best for my shareholders.” (p.623)
Of course most of the time ExxonMobil’s needs align with – and often help guide – U.S. policies. Iraq is a prime example. The Bush administration consulted regularly with the oil companies, and ExxonMobil CEO Lee Raymond in particular, as it plotted strategy for toppling Saddam Hussein and securing the country in a way that would provide access to its rich oil resources.
It was a close but cautious relationship. “Throughout his cultivation of the Bush administration, however, Raymond purposely kept ExxonMobil at arm’s length from the administration’s attempts to remake post-Saddam Hussein Iraq,” Coll writes on page 248. “It was not in ExxonMobil’s interests to become tainted by failed nation-building projects in a country that held one of the world’s largest unproduced oil and gas resource bases. American neoimperial ambition in Iraq might fail, but ExxonMobil’s private empire had its own enduring interests, and these should not be rushed.”
The company’s patience paid off big time. In late 2009 ExxonMobil Upstream Ventures closed a deal for exclusive access to Iraq’s West Qurna Phase One oil project, a field containing at least 8.7 billion barrels of oil, Coll writes on page 574. “Eighteen months later, ExxonMobil … was loading Iraqi crude into supertankers in the Persian Gulf that could hold 2 million barrels at a time.”
ExxonMobil isn’t always successful conducting its own foreign policy. The company’s efforts to develop gas contracts in Qatar and Saudi Arabia went bust, partly due to the arrogance of some of its top managers in the Middle East. Its hopes of joint ventures with Russia also fell flat, even with the help of former President George W. Bush, who tried to open doors for U.S. oil companies with President Vladimir Putin.
ExxonMobil’s “private empire” hasn’t just played a major role in world energy development. The company’s impact on the environment, both locally and globally, has been profound.
Coll opens and closes his book with two major oil spills: the Exxon Valdez accident in 1989 that devastated the Alaska coastline and the BP disaster in the Gulf in 2010. There are ironic connections between the two catastrophes – BP was responsible for the industry’s response to the Exxon spill in Alaska and failed miserably; ExxonMobil and BP had identical response plans in place for potential spills in the Gulf, and we know how well BP’s worked out.
At the local level, ExxonMobil was liable for damages from a 24,000-gallon fuel leak from a gas station near Baltimore in 2006 that affected homes and businesses within a half-mile radius of the spill. But the company’s lawyers have dragged out litigation in the case with appeal after appeal, making it unlikely that some of the victims will ever see compensation in their lifetimes.
Then there’s the matter of climate change. There may be no more significant reason why the United States today has no national policy to address global warming than the unrelenting opposition of former ExxonMobil CEO Lee Raymond. “The Earth is cooler today than it was twenty years ago,” Raymond said in a famous speech denying the existence of climate change in 1997.
And today in Washington, the temperature is approaching 100 degrees for the ninth time this summer in what is almost certain to be the hottest year on record.
[As a courtesy to our guests, please keep comments to the book and be respectful of dissenting opinions. Please take other conversations to a previous thread. - bev]