OIL AND THE MIDEAST CRISIS

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP75-00001R000100060016-4
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 1
• Document Creation Date: November 11, 2016
• Document Release Date: February 8, 1999
• Sequence Number: 16
• Content Type: NSPR

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by VI.C'IOR PERLO
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(.an Oil (:otrtj? III)-,
p iants, is the hugest p1 nltt er in the lea
rote ecstatically of its affairs: "It.s (tilde
vice as large a.s those c(mlaittc(l ill the
losely guarded hooks were to le public,
lit it has the highest profit nrugin of
nation in the world" (Marc) iii, I9I(1)
Oil royalty and tax payments to the: ho
tents are now its the 80 to 85 (('Isis prr
tart] bargaining, partly through the
:xpotting Countries (Ol'1?C), the chain plr=
ncrcascs. in deals with Japanese, Italians,
.olnpaniCS, Middle Eastern count tics Ito
side from taxes, the actual cost of pro
ccording to John Warder, Chairman of
ortinm, is 14 cents per barrel in bait, .f1 t
nd G cents in Kuwait. For conip;u isnn
allon gasoline, this Kuwait cost atitortnt.
ter gallon.
'floe average selling prices of Standati
acre in Lite range of $8 to $1 per hair(
ncurrc(i its refining, transportation, :ltd
if crude oil rcrluires the heaviest invests
lone in the Middle East also. Ily an c(ptlita
Eastern countries would be entitled to
final value. But the real situation, as shows
For every dollar's worth of ftroducts th i
oil, the Middle Eastern governments get a =
ruorhers less than one cent.
IItS AIZAIIS have branded the Alrtericait and fritis h 01 c.o .
and govcrnmcills as responsible for the Israeli invasion and
ccnpation of their lands. is this justified, or have the Arabs merely
)ickecl onan innocent scapegoat for their own failures?
List year nearly 600,000,000 metric tons of oil were pumped out
A the Mi(lcllc East and North Africa, equal to 43 per CCnt of the
nttput of the capitalist world. The Share of the Middle Vast" in
vorld Ontplit rises bCCattse it contains most of the capitalist world
Cscives, and production per well is huge. This year US contp;uhics
planned to reinvest $1,136 million of their profits in f(ir(hc.r Middle
i.astcrn expansion, ill) 36 per cent from their 19I h ini?cst,nertt there.
Western Europe already gets 84 per cent of its oil horn the )]Middle
Fast; Japan over 90 per cent. Only 3 per cent of the. US supply covers
from the area, but US companies control most of the oil, and 65
per cent of the oil used by the US armed forces in Viet.ti im comes
from the 1'etsian Gulf.
US (:nntcanies today produce abroad goods worth over $100
billion yearly, an amount exceeding the national income of any
capitalist Country outside the United States. Profits from foreign
investments even exceed profits derived from the vast military budget.
Aiid one-third of all the profits on direct foreign, vestments rernittc
to the United States in 1965 come from. Middle Enstrrn oil.
The Big Five US oil companies (Standard of New Jersey, Texaco,
Gulf, Mobil, and Standard of California) occupy five of the sever
top places among US industrial corporations, including first place i
the amount of their invested capital. Their assets totaled $;t6 billion
and their admitted profits (far under the actual total) were $3.
billion in 1966. Approximately half of their crude oil, the decisiv
source of profits, came from the middle East. Oil company figure
as reported to the US Department of Commerce, admitted 1965 afte
tax profits on Middle Eastern investments equal to 76 per cent
the claimed value of the investments at the beginning of the ye
(Survey of Current Business, September 1966).
? Thrmtshout 11110 enicte, 1W4 term includes 'haotth fllricr,.
Vtcron Vtcrno, noted ecflnomist and writer an world affairs, frnrluently appen s
11,
In NWI1. His major economic writings include Empire of high I%man ,
American Imperialism, and USA and USSRt The Economic Race.
1
i`~'ilfl; TEN cents is received, usteally, b]',;l
interest in their subjects' welfare oii
development. The people who work tilt I
The great itatnral wealth of the Micldic the wherewithal for a splendid progr;nu e f
cultural development and rising living sI n
of US and British oil companies, conttihtt 'tl
the fierce poverty and backwardness of ill a
tion from now it may be too late, as omit it
The oil companies clearly associate 14 11
maintaining backward social conditions, ill'
their direct and indirect political activity Rim
coordination of oil company and U.S
their foreign properties began after Will (I
Oil (N.J.) Chairman A. C. Bedford said
now is an aggressive foreign policy on the. pa
Sanitized - Approved For Release : CIA-RDP75-00001 R000100060016-4