The U.S. Strategy to Control Middle Eastern Oil: “One of the Greatest Material Prizes in World History”

March 2, 2012

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By Andrew Gavin Marshall

NOTE: The following is a research sample from The People’s Book Project. It is unedited and in draft format, but is intended as an excerpt of some of the research that is going into the book. This research sample is drawn from a recently written chapter on the history of American imperialism in the Middle East and North Africa. Please support The People’s Book Project by contributing a donation to The People’s Grant to reach the target goal of $1,600 to fund two major chapters in the book on a radical history of race and poverty.

In the midst of World War II, Saudi Arabia secured a position of enormous significance to the rising world power, America. With its oil reserves essentially untapped, the House of Saud became a strategic ally of immense importance, “a matter of national security, nourishing U.S. military might and enhancing the potentiality of postwar American hegemony.” Saudi Arabia welcomed the American interest as it sought to distance itself from its former imperial master, Britain, which it viewed with suspicion as the British established Hashemite kingdoms in the Middle East – the old rivals of the Saudis – in Jordan and Iraq.[1]

The Saudi monarch, Abdul Aziz bin Abdul Rahman al Saud had to contend not only with the reality of Arab nationalism spreading across the Arab world (something which he would have to rhetorically support to legitimate his rule, but strategically maneuver through in order to maintain his rule), but he would also play off the United States and Great Britain against one another to try to ensure a better deal for ‘the Kingdom’, and ensure that his rivals – the Hashemites – in Jordan and Iraq did not spread their influence across the region. Amir (King) Abdullah of Transjordan – the primary rival to the Saudi king – sought to establish a “Greater Syria” following World War II, which would include Transjordan, Syria, Iraq, Lebanon and Palestine, and not to mention, the Hejaz province in Saudi Arabia. The image and potential of a “Greater Syria” was central in the mind of King Abdul Aziz. The means through which the House of Saud would seek to prevent such a maneuver and protect the ‘Kingdom’ was to seek Western protection. As the United States had extensive oil interests in the Kingdom, it seemed a natural corollary that the United States government should become the ‘protector’ of Saudi Arabia, especially since the British, long the primary imperial hegemon of the region (with France a close second), had put in place the Hashemites in Transjordan and Iraq.[2] For the Saudis, the British could not be trusted.

The Saudi King rose to power and established the Kingdom of Saudi Arabia in 1927 and made formal ties with the United States in 1931. An oil concession was soon granted to the Rockefeller-owned Standard Oil of California, and thereafter, large quantities of oil were discovered in the Kingdom, thus increasing the importance of the Saudi monarch. This was especially true during World War II, when access to and control over petroleum reserves were of the utmost importance in determining the course of the war. In 1943, President Franklin Roosevelt acknowledged as much when he signed Executive Order 8926, which stated that, “the defense of Saudi Arabia [is] vital to the defense of the United States.”[3] United States Secretary of the Interior Harold Ickes, several months earlier, suggested to President Roosevelt that the United States be more involved in organizing oil concessions in Saudi Arabia not only for the war effort, but “to counteract certain known activities of a foreign power which presently are jeopardizing American interests in Arabian oil reserves.” That “foreign power” was Great Britain. In fact, there was immense distrust of British intentions in the Middle East, and specifically in Saudi Arabia, on the part of the State Department’s Division of Near East Affairs (NEA). A great deal of this tension and antagonism, however, emerged from Saudi diplomacy which sought to play off the two great powers against one another in the hopes of securing for itself a better deal.[4]

Anthony Eden, the British Foreign Secretary (and later Prime Minister), wrote to Prime Minister Winston Churchill in September of 1943 that, “our difficulty is to keep the Americans in line,” in relation to Saudi Arabia. As Roosevelt’s Executive Order categorized Saudi Arabia as “vital to the defense of the United States,” this allowed Saudi Arabia to qualify for the Lend-Lease program during the war, reducing Saudi dependency upon the British, and which included arms sales to the Kingdom. Following this event, British Foreign Office officials lamented, “We would not dream of entertaining a direct application for arms from a South American country for example, without at once consulting the American arms representative in London and deferring to his views.” This, of course, was a reference to Latin America in the context of the Monroe Doctrine – America’s “backyard” – and thus, was implying, that the Middle East was Britain’s “backyard.”[5]

Adolf A. Berle, Roosevelt’s Assistant Secretary of State explained to the British the objective of American designs for the Middle East. As Simon Davis summarized, European imperial “spheres of influence were to give way to open political and economic circumstances in which Americans interests were not to be demarcated by other great powers.”[6] In short, it was to be the demise of formal imperialism for the rise of informal empire, led by the United States. The “open political and economic circumstances” desired by American officials were in no small part influenced by petroleum concerns. Technical studies had been undertaken which pointed to the Middle East as the most oil-rich region in the world. At the time, Saudi Arabia was the only country in which American oil interests had established themselves prior to World War II. The British had actually approached the United States on behalf of the House of Saud in the early 1940s to secure funds for the Saudi government, as the British were stretched thin by the war in Europe. The United States had at first rejected the proposals, suggesting that Saudi Arabia was British responsibility. The American Minister in Cairo, Alexander Kirk, complained that such a move suggested to the Arab world that the United States was “resigning to the British all initiative in the Near East generally and in Saudi Arabia particularly.” The Saudis then approached American oil companies for support in 1942, who in turn approached the State Department’s Division of Near East Affairs, raising fears that leaving “responsibility” for the Near East and Saudi Arabia to the British would eventually mean a loss of oil concessions in Saudi Arabia to British interests. At the same time, Saudi officials were also quietly approaching the British to increase their interest in the Kingdom, suggesting that the Americans were attempting to maneuver the British out of the Near East. The Saudi Foreign Minister told a British official in December of 1942 that, “although [King Ibn Saud’s] relations with United States are friendly both in themselves and because United States is Britain’s ally… yet his relations with United States could never be so close and friendly as with His Majesty’s Government with whom he has so many interests in common.”[7]

A deceptive diplomatic game between the United States, Great Britain, and Saudi Arabia ensued. As the Americans shifted their interest in Saudi Arabia in 1943, Gordon Merriam, the assistant chief of the State Department’s Division of Near Eastern Affairs suggested in January of 1943 that the possibility of the British pushing their way into America’s oil concessions in the Kingdom after the war “has been very much on our minds.” Secretary of State Cordell Hull wrote that, “It should be kept clearly in mind that the expansion of British facilities serves to build up their post-war position in the Middle East at the expense of American interests there.”[8]

Britain, however, was not trying to exclude the United States, but to include it in an Anglo-American approach to the region. British Foreign Office documents stressed that the British were “by no means prepared to sacrifice a century of hard-earned political influence in the Middle East to their upstart American cousins,” however, the British sought to “coopt rather than preempt US interests.”[9] Churchill even wrote to Roosevelt to stress “the fullest assurance that we have no thought of trying to horn in upon your interests and property in Saudi Arabia.” The British even acknowledged in their internal correspondence that, “it seems probably that sooner or later the United States will become the foreign power most concerned with Saudi Arabian affairs.” The aim of the British, then, was not to expand their influence at the expense of the Americans, but to maintain their influence as the U.S. increased its own.[10]

In July of 1944, British diplomat Lord Halifax wrote to the United States, “We have made it perfectly plain that we have no wish to oppose increased American influence in Saudi Arabia so long as it does not seek to crowd us out. But it would be helpful if the Americans would realize that they cannot hope to achieve overnight quite the same position that we have built up over long years.” The United States was pressuring Britain to replace their representative in Saudi Arabia, S.R. Jordan, over State Department fears that Jordan was the primary British antagonist of expanding American influence in the Kingdom. Jordan was ironically, at that time, writing in cables to the British that, “Strategically, it would appear that we have little to fear from the presence of increasing US participation in Saudi Arabian affairs.” What became most frustrating to the British, however, was not the expansion of American power, but rather the perspective of Americans at the State Department (with fears stoked by the oil companies and Saudis) that the British were trying to keep the US out of Middle Eastern affairs. As the British Minister of State in the Middle East, Lord Moyne, observed, “I am afraid it is another of the many cases we have had in the Middle East where the local American idea of cooperation is that we should do all the giving and they all the taking.” As the British realized the Saudi role in creating these fears among the Americans, Moyne wrote, “It has subsequently turned out that the Finance Minister and the King’s Syrian advisers have been furnishing misleading figures and exploiting their position for political ends.”[11]

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