It's Still About the Oil

The Iraq war was always about oil. The ISIS extremists who are trying to seize control of the country's largest refinery know that. Everyone was braced for the battle for Baghdad. But first they went after the oil. Just like the Americans.

The Iraq war was always about oil. The ISIS extremists who are trying to seize control of the country's largest refinery know that. Everyone was braced for the battle for Baghdad. But first they went after the oil. Just like the Americans.

In 2003, when Baghdad was a chaos of looting, the one thing the Americans secured was the Oil Ministry. Because oil is power.

If all you've got is a cave on a mountain side somewhere in Afghanistan, you have to do something really big to get the world's attention, like flying a couple of 767s into the tallest building in New York.

But if you've got oil, and if you control enough of it, then you can hold the world to ransom. Just like the Russians.

That's what Vladimir Putin's doing. While everyone was looking the other way at Iraq, he's just switched off the gas supply to Ukraine. And that's an implicit threat to much of Europe, which depends on Russia for its gas.

Oil is even more important than gas. The global economy depends on it. It's not how much the oil you have is worth today, it's how much economic damage you can inflict by cutting off the supply.

The Americans invaded Iraq for many reasons, but it would never have happened if the oil wasn't there. And now a war which the US fought because of Iraqi oil may be about to end in handing that oil over to Al-Qaeda.

Of course, the world can stand some of the oil being cut off, as it did with Iranian oil for years. It can make up the shortfall elsewhere.

But it's worse than that in Iraq. Because what is happening there is a proxy war between Saudi Arabia and Iran. The Saudis finance and support ISIS, and the Iranians back the Iraqi government and the Iraqi Shia militias.

And between them, Iran, Iraq and Saudi Arabia control the largest oil reserves in the world.

What if some one decides all the oil is now in play? That Iraq is on the verge of breaking up, and its oil is there for the taking?

What if the Shia decide to make a bid for the Saudi oil reserves, which lie just across the border from Shia-controlled southern Iraq, in an area of Saudi Arabia with a large Shia population?

Of course, that's unthinkable for now. But a couple of weeks ago, it was unthinkable that a few thousand extremists loyal to Al-Qaeda would put the Iraqi army to flight, seize control of Iraq's second city and a vast swathe of the country, and be at the gates of Baghdad.

If the oil does come into play, there is no way the outside world will stand by. The region's oil reserves are simply too important to the world economy. If the US does not take decisive action, then others will. China's massive economy, for one, needs that oil.

All sorts of players could make a bid for the oil. For now, Kirkuk's reserves are in Kurdish hands, but how long would Turkey stand by and let its historic enemies enjoy that wealth, in a region it regards as its backyard?

Now, ten years after it started an unnecessary war because of Iraqi oil, a reluctant US could be forced to fight a new war, over the same Iraqi oil.

And it will be Russia that benefits most. Vladimir Putin doesn't need to lift a finger. He will see the value of his own vast oil reserves - and the power they confer - soar.

It is the sort of situation that could set off a regional war, even a world war.

We are not, thankfully, anywhere near that yet. ISIS are fighting for control of a refinery, not the oil fields, which are under control. For now.

But the fighting at the Baiji oil refinery is a warning of just how dangerous the situation in Iraq is for the world.

Justin Huggler covered the Iraq and Afghanistan wars for The Independent. His novel, The Burden of the Desert, set in occupied Iraq, is available from all good bookshops.

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