The secrets of the Seven sisters...a lesson in reality On August 28 , 1928 , in the Scottish highlands, began the secret story of oil. Three men had an appointment at Achnacarry Castle - a Dutchman , an American and an Englishman . The Dutchman was Henry Deterding, a man nicknamed the Napoleon of Oil , having exploited a find in Sumatra. He joined forces with a rich ship owner and painted Shell salesman and together the two men founded Royal Dutch Shell . The American was Walter C . Teagle and he represents the Standard Oil Company, founded by John D . Rockefeller at the age of 31 - the future Exxon . Oil wells , transport , refining and distribution of oil - everything is controlled by Standard oil. The Englishman , Sir John Cadman , was the director of the Anglo- Persian oil Company, soon to become BP . On the initiative of a young Winston Churchill , the British government had taken a stake in BP and the Royal Navy switched its fuel from coal to oil. With fuel- hungry ships, planes and tanks , oil became the blood of every battle . The new automobile industry was developing fast , and the Ford T was selling by the million . The world was thirsty for oil, and companies were waging a merciless contest but the competition was making the market unstable . That August night , the three men decided to stop fighting and to start sharing out the worlds oil . Their vision was that production zones, transport costs, sales prices - everything would be agreed and shared . And so began a great cartel , whose purpose was to dominate the world, by controlling its oil. Four others soon joined them , and they came to be known as the Seven Sisters - the biggest oil companies in the world . In the first episode , we travel across the Middle East, through both time and space. We waged the Iran - Iraq war and I say we waged it, because one country had to be used to destroy the other. As they already benefit from the oil bonanza , and they ’ re building up financal reserves , from time to time they have to be bled . - Xavier Houzel , an oil trader Throughout the region s modern history , since the discovery of oil, the Seven Sisters have sought to control the balance of power . They have supported monarchies in Iran and Saudi Arabia , opposed the creation of OPEC , profiting from the Iran - Iraq war , leading to the ultimate destruction of Saddam Hussein and Iraq. The Seven Sisters were always present, and almost always came out on top . Since that notorious meeting at Achnacarry Castle on August 28 , 1928 , they have never ceased to plot , to plan and to scheme . At the end of the 1960 s , the Seven Sisters , the major oil companies , controlled 85 percent of the world s oil reserves . Today , they control just 10 percent. New hunting grounds are therefore required , and the Sisters have turned their gaze towards Africa. With peak oil, wars in the Middle East, and the rise in crude prices , Africa is the oil companies new battleground . Everybody thought there could be oil in Sudan but nobody knew anything. It was revealed through exploration by the American company Chevron, towards the end of the 70 s . And that was the beginning of the second civil war , which went on until 2002 . It lasted for 19 years and cost a million and a half lives and the oil business was at the heart of it. - Gerard Prunier, a historian But the real story , the secret story of oil, begins far from Africa. In their bid to dominate Africa, the Sisters installed a king in Libya , a dictator in Gabon , fought the nationalisation of oil resources in Algeria , and through corruption , war and assassinations, brought Nigeria to its knees. Oil may be flowing into the holds of huge tankers, but in Lagos, petrol shortages are chronic . The country s four refineries are obsolete and the continent s main oil exporter is forced to import refined petrol - a paradox that reaps fortunes for a handful of oil companies . Encouraged by the companies , corruption has become a system of government - some $ 50 bn are estimated to have disappeared out of the $ 350 bn received since independence. But new players have now joined the great oil game . China, with its growing appetite for energy , has found new friends in Sudan, and the Chinese builders have moved in. Sudans President Omar al- Bashir is proud of his co- operation with China - a dam on the Nile , roads, and stadiums . In order to export 500 , 000 barrels of oil a day from the oil fields in the South - China financed and built the Heglig pipeline connected to Port Sudan - now South Sudans precious oil is shipped through North Sudan to Chinese ports. In a bid to secure oil supplies out of Libya , the US , the UK and the Seven Sisters made peace with the once shunned Colonel Muammar Gaddafi, until he was killed during the Libyan uprising of 2011 , but the flow of Libyan oil remains uninterrupted. In need of funds for rebuilding , Libya is now back to pumping more than a million barrels of oil per day . And the Sisters are happy to oblige . In the Caucasus , the US and Russia are vying for control of the region . The great oil game is in full swing. Whoever controls the Caucasus and its roads, controls the transport of oil from the Caspian Sea . Tbilisi, Erevan and Baku - the three capitals of the Caucasus . The oil from Baku in Azerbaijan is a strategic priority for all the major companies . From the fortunes of the Nobel family to the Russian revolution , to World War II , oil from the Caucasus and the Caspian has played a central role . Lenin fixated on conquering the Azeri capital Baku for its oil, as did Stalin and Hitler . On his birthday in 1941 , Adolf Hitler received a chocolate and cream birthday cake , representing a map . He chose the slice with Baku on it . On June 22 nd 1941 , the armies of the Third Reich invaded Russia . The crucial battle of Stalingrad was the key to the road to the Caucasus and Baku ’s oil , and would decide the outcome of the war. Stalin told his troops: Fighting for one ’s oil is fighting for one ’s freedom . After World War II , President Nikita Krushchev would build the Soviet empire and its Red Army with revenues from the USSR ’s new- found oil reserves . Decades later , oil would bring that empire to its knees, when Saudi Arabia and the US would conspire to open up the oil taps, flood the markets , and bring the price of oil down to $ 13 per barrel. Russian oligarchs would take up the oil mantle , only to be put in their place by their president, Vladimir Putin, who knows that oil is power . The US and Putin ‘s Russia would prop up despots , and exploit regional conflicts to maintain a grip on the oil fields of the Caucusus and the Caspian . But they would not have counted on the rise of a new, strong and hungry China, with an almost limitless appetite for oil and energy . Today , the US, Russia and China contest the control of the former USSR ’s fossil fuel reserves , and the supply routes . A three - handed match , with the world as spectators , between three ferocious beasts – The American eagle, the Russian bear, and the Chinese dragon . Peak oil – the point in time at which the highest rate of oil extraction has been reached, and after which world production will start decline . Many geologists and the International Energy Agency say the world s crude oil output reached its peak in 2006 . But while there may be less oil coming out of the ground , the demand for it is definitely on the rise. The final episode of this series explores what happens when oil becomes more and more inaccessible , while at the same time , new powers like China and India try to fulfill their growing energy needs . And countries like Iran , while suffering international sanctions, have welcomed these new oil buyers , who put business ahead of lectures on human rights and nuclear ambitions . At the same time , oil- producing countries have had enough with the Seven Sisters controlling their oil assets . Nationalisation of oil reserves around the world has ushered in a new generation of oil companies all vying for a slice of the oil pie . These are the new Seven Sisters . Saudi Arabias Saudi Aramco, the largest and most sophisticated oil company in the world ; Russia s Gazprom , a company that Russia s President Vladimir Putin wrested away from the oligarchs ; The China National Petroleum Corporation ( CNPC) , which, along with its subsidiary , Petrochina, is the world s secnd largest company in terms of market value; The National Iranian Oil Company , which has a monopoly on exploration , extraction , transportation and exportation of crude oil in Iran – OPEC s second largest oil producer after Saudi Arabia; Venezuela s PDVSA, a company the late president Hugo Chavez dismantled and rebuilt into his country s economic engine and part of his diplomatic arsenal ; Brazil s Petrobras , a leader in deep water oil production, that pumps out 2 million barrels of crude oil a day; and Malaysia s Petronas - Asia s most profitable company in 2012 . Mainly state - owned , the new Seven Sisters control a third of the world s oil and gas production, and more than a third of the world s reserves . The old Seven Sisters , by comparison, produce a tenth of the world s oil, and control only three percent of the reserves . The balance has shifted . What does this tell us?
Posted on: Tue, 04 Mar 2014 19:51:57 +0000
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