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Published: Sunday, 8/10/2003

Friends in high places

The question of who will benefit from renewed petroleum production in Iraq has faded as a public issue in the post-war chaos, but one thing is certain: the Bush Administration is taking extraordinary steps to protect U.S. oil interests in the occupied nation.

An executive order that went largely unnoticed after it was signed by President Bush on May 22 appears to give the industry blanket immunity from lawsuits or even criminal acts involving sale of Iraqi oil.

Government watchdog groups say the order is so broad that it could shield oil companies and individuals from responsibility for human rights violations, bribery, environmental damage, or even false advertising in gasoline marketing.

Administration officials say the intent of the order is to ensure that proceeds from Iraqi oil aren't siphoned off and that administrative rules to be published soon will make that clear.

We'll see. The issue bears continued scrutiny, given the administration's reputation for “bait and switch” tactics - saying one thing and doing the opposite.

Iraq began shipping crude oil in late June for the first time since the U.S. invasion in March. L. Paul Bremer, who heads the occupying forces, said then that he expects about $5 billion worth of oil to be sold by year's end.

Kuwait is to get about $1.5 billion in compensation for the 1990 Iraq invasion, Mr. Bremer said, with the remaining $3.5 billion going into the special development fund set up by the United Nations in May.

In the meantime, the watchdog groups are rightly suspicious of the executive order. Tom Devine, legal director of the Washington-based Government Accountability Project, says the document “appears to cancel the rule of law for the oil industry or anyone else who gets possession or control of Iraqi oil or anything of value related to Iraqi oil.”

Nonsense, says a Treasury Department spokesman. “This does not protect the [oil] companies' money. It protects the Iraqi peoples' money.”

Maybe so, but why wasn't the order written more narrowly? “It's very disingenuous to suggest that the only thing that's being protected here are development funds for Iraq,” said Betsy Apple, of Earthrights International. “That's trying to hide the fact that it's the oil companies who are doing that work and generating those proceeds.”

This is not a matter of splitting legal hairs over arcane words. A lot of money is at stake, and so is the credibility of the administration, which continues to claim that control of Iraq's huge oil reserves was never a reason for going to war.

As someone famously said, “Watch what they do, not what they say.”



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