Middle East Online

Basra Voters Hope Elections Will Revive Iraqi Economy

Voters in southern Iraq's oil-rich Basra province are pinning their hopes on elections to revive the ruined economy.

Keep reading... Show less

Shoe-Throwing Journalist Faces Trial on Dec 31

The Iraqi journalist thrust to instant fame when he threw his shoes at U.S. President George W. Bush will go on trial this month on charges that risk up to 15 years in jail, a judge said on Monday.

"The investigation phase is over and the case has been transferred to the Central Criminal Court," investigating judge Dhiya al-Kenani said. "The trial will start on Wednesday, December 31."

Muntazer al-Zaidi stands accused of "aggression against a foreign head of state during an official visit," an offense that carries a prison term of between five and 15 years under Iraqi law.

But the court could convict him of the lesser charge of an "attempted aggression" which carries a prison term of one to five years.

Zaidi, 29, became a hero to many when he threw his shoes at Bush during the U.S. president's surprise visit to Iraq on December 14, an action considered a grave insult in the Arab world.

His lawyer had asked that the case against Zaidi was transferred from the central criminal court, which handles terrorism cases, to an ordinary tribunal but the judge refused.

"The fact he did not strike his target could serve in his favor," Kenani said last week, alluding to the fact that Bush succeeded in ducking the shoes.

Zaidi's actions were hailed by many in the Arab world who considered it an ideal parting gift to a deeply unpopular Bush, who ordered the 2003 invasion of Iraq that triggered years of deadly insurgency and sectarian conflict.

The journalist for private Iraqi television station Al-Baghdadia was wrestled to the ground by security guards after his actions and is now planning to sue over injuries caused, his lawyer Dhiya al-Saadi said on Sunday.

"There are bruises on his body. He has lost a tooth in his upper jaw, and his left eye is bloodshot," the lawyer said, adding that the list of injuries is backed up by medical checks.

Kenani on Monday confirmed that a complaint had been lodged against the security guards and that a letter would be sent to the office of Prime Minister Nuri al-Maliki in order to bring them to justice.

"Neither Muntazer, nor us, know their names but we may be able to recognise some of them from the television pictures," he said.

According to Maliki's press aide Yassin Majid, Zaidi wrote a note to the prime minister last week seeking his pardon over the incident.

For the first time on Sunday, one of Zaidi's brothers Uday, was able to see his detained sibling.

His family has been demonstrating in a park near the Green Zone in central Baghdad to demand his release from custody but Uday al-Zaidi said they had been told to leave by security forces because they were in a sensitive area.

"We were forced by the Iraqi military to leave the area and they threatened to arrest us if we do not leave," he said.

Suicide Bomb Kills 55 at Packed Iraq Restaurant

At least 55 people were killed and 95 were wounded in a suicide bomb attack in a restaurant near the northern Iraqi city of Kirkuk on the final day of the annual Feast of the Sacrifice holiday.

Keep reading... Show less

Iraqi Parliament Approves Status of Forces Agreement

The Iraqi parliament on Thursday approved by a vast majority a landmark military pact that will have all U.S. troops withdraw from the country by 2011, during a televised session.

Keep reading... Show less

Controversial Status of Forces Agreement Facing Iraqi Opposition

Iraq's top leaders met late Sunday to review a controversial security pact with the U.S. that will determine American troop deployments beyond this year, a parliamentary official said.

The official who spoke on condition of anonymity said members of the Political Council for National Security met for about two hours at the Baghdad home of President Jalal Talabani.

The council, which comprises Talabani, Prime Minister Nuri al-Maliki and other senior government officials, discussed the draft in detail. They are now expected to refer it to the cabinet, the official said, giving no further details.

Should the cabinet give the go-ahead, the agreement would then be submitted to parliament for final approval.

The deal is fiercely opposed by many key Iraqi role players, including Shiite radical cleric Moqtada al-Sadr who brought thousands of his supporters onto the streets of Baghdad on Saturday to demand the immediate withdrawal of U.S. troops.

Sadr on Saturday urged parliament not to vet the accord while on Sunday senior leaders of Maliki's own ruling alliance also came out against it, saying further changes are necessary.

"There are positive points and others need more time to be discussed, and others need modification," the United Iraqi Alliance (UIA) said in a statement.

Meanwhile, due to the ongoing negotiations with Washington over the pact, Maliki has decided to postpone his visit to Australia scheduled for next week, his office said in a statement Sunday.

The agreement was due to be concluded by the end of July but became embroiled in squabbles over whether U.S. soldiers in Iraq who commit crimes would continue to enjoy the immunity from prosecution in Iraqi courts they were granted at the time of the U.S.-led invasion in 2003.

The latest draft stipulates that Iraq has the right to prosecute U.S. soldiers and civilians for crimes committed outside their bases and when off duty.

It further says that the U.S. will have the primary right to exercise jurisdiction over its soldiers and civilians if they commit a crime inside their facilities or when on missions.

But the arrangement gives Iraqi courts the right to prosecute U.S. soldiers and civilians if they commit "grave and premeditated felonies outside their facilities and when not on missions."

The decision is seen as a hard-won concession for Maliki who has taken a tough stand on protecting his country's sovereignty in the pact.

The so-called Status of Forces Agreement (SOFA) will provide the legal basis for a U.S. troop presence in Iraq after the present UN mandate expires on December 31.

A failure to agree on the terms would force Baghdad and Washington to find another legal framework.

If the agreement is signed by the two sides and approved by the Iraqi parliament, it will become effective from January 1 and last for three years, during which a phased withdrawal of U.S. forces is outlined.

According to the draft agreement, U.S. combat forces will withdraw from Iraqi towns and villages by June 2009 and pull out of Iraq completely by December 2011.

The two sides have also agreed that all military operations in Iraq will be carried out with the approval of Baghdad under the supervision of a Joint Military Operation Coordination Committee (JMOCC) to be formed under the pact.

The agreement also restricts U.S. military powers by permitting troops to detain Iraqis only through an Iraqi order.

"In case they detain, the detainee must be handed over to Iraqi authorities within 24 hours," the document says.

Maliki said on Sunday that Iraq was keen to negotiate a similar security pact with Britain to provide for a British military presence beyond this year.

"If the SOFA with the U.S. is approved by parliament, it will help signing an agreement with British for their military presence in Iraq," he said in a statement after talks with visiting British Defense Secretary John Hutton.

Hutton, 53, who took over the defense portfolio from Des Browne just over two weeks ago, said that he had brought his team to discuss the Status of Forces Agreement between Baghdad and London.

Iraqi Doctors to Carry Guns for Self-Defense

BAGHDAD -- The Iraqi government on Monday said it will allow doctors to carry guns in self-defense, pledging that they will not be detained during security operations.

The cabinet agreed to grant weapons permits to doctors in the light of the killing by insurgents of a large number of professional people since the 2003 U.S.-led invasion.

"The cabinet decided to allow each doctor to carry one weapon to defend himself," the statement said. Doctors will not be detained during security operations unless the health ministry has been informed.

In a move seen as an attempt to prevent the emigration of skilled people, the government is also offering better housing for doctors and a review of taxes imposed on professionals, the statement said.

In July, Iraqi doctors in the southern oil city of Basra staged demonstrations demanding better protection for them after a colleague was kidnapped in the region.

Petraeus to Hand Over Iraq Command Sept 16

Baghdad -- U.S. General David Petraeus will hand the command of U.S.-led forces in Iraq to General Raymond Odierno on September 16, his spokesman said Sunday.

"He will hand over the command on September 16 in Baghdad," Colonel Steven Boylan said.

Petraeus will take over as the new chief of Central Command in late October, with responsibility for U.S. troops from the Horn of Africa to Central Asia, including live conflicts in Afghanistan and Iraq, Boylan said.

The expected shift will come at a time when pressure is growing to beef up the U.S. troop presence in Afghanistan, where the level of violence is now said to be higher than in Iraq.

In July, Petraeus was approved by the U.S. Senate to head Central Command after Admiral William Fallon abruptly stepped down from the post in March, saying that reports describing him as at odds with the White House over how to deal with Iran had become "a distraction."

About 144,000 U.S. soldiers are currently on the ground in Iraq, but that number could decrease in coming months.

Before leaving Iraq, Petraeus will offer to U.S. President George W. Bush his recommendations on troop cuts in Iraq amid a reported drop in violence which is currently at a four-year low.

Petraeus, the architect of the troop surge strategy, arrived here in February last year with the launch of a surge of 30,000 U.S. troops.

Aside from having more troops at his disposal, Petraeus also embarked on a counter-insurgency strategy that underscored the importance of winning Iraqi hearts and minds.

His strategy demanded that U.S. soldiers engage with and respect citizens while relentlessly pursuing Al-Qaeda and other extremist groups.

Washington withdrew five combat brigades that were deployed as part of the surge.

On Thursday, in an interview with the Financial Times, Petraeus said U.S. combat troops could be out of Baghdad by July 2009 "conditions permitting."

"The number of attacks in Baghdad lately has been, gosh, I think it's probably less than five (a day) on average, and that's a city of seven million people," he said.

He told the London-based business daily that Iraq was a "dramatically changed country" since he took over in February 2007, pointing to a "degree of hope that was not present 19 months ago."

Petraeus insisted, however, that "innumerable challenges" still remain.

German Firms Eye Iraq Market

BERLIN -- Iraqi Prime Minister Nuri al-Maliki and German bosses have a dinner date Tuesday following a visit this month by Economy Minister Michael Glos to Baghdad, signifying that German-Iraqi trade is back in business.

Iraq was historically a strong partner for Germany, and in the 1980s bilateral trade reached four billion euros (6.4 billion dollars) a year.

But by last year, Germany only exported goods worth a total of 319 million euros to the war-ravaged country.

German companies have always been eager to work with a country that has ample oil reserves and where reconstruction programs offer major contracts for makers of machine tools and industrial facilities, two German specialties.

German Chancellor Angela Merkel, who was to receive Maliki on Tuesday, has expressed strong interest in developing economic and business ties and German companies are chomping at the bit.

Eckart von Unger, director of the Africa and Middle East department at the German industrial federation BDI, told the business daily Handelsblatt: "In the near future, we hope Iraq will again hit four billion euros, like in the good old days."

For now however, while many German companies have expressed interest in working in Iraq, few have taken the next steps.

Wintershall, a unit of the chemical giant BASF, is one of the few to actively seek contracts, in its case a license for oil drilling.

A BDI spokesman acknowledged that "we cannot say how many German companies are currently active in Iraq."

Insecurity, corruption and poor infrastructure are obstacles to many.

"The risks to Germans working there is still very high," said Axel Nitschke, head of the German chamber of commerce DIHK's external trade department, in comments to the Neue Passauer Presse newspaper.

But both countries are working on improving the situation.

In June, a German-Iraqi economic commission was resuscitated and met here for the first time since 1987, under the oversight of Glos and Iraqi Industry Minister Fawzi al-Hariri.

Six weeks later, Glos flew to Iraq along with a sizeable German business delegation.

He was the first member of the government to make the trip since 2003.

On Tuesday, the Arab-German chamber of commerce and industry Ghorfa is organizing the dinner with Maliki and "around 100 business leaders, particularly heads of small- and medium-sized enterprises," the group said.

In Iraq as well, interest in bigger contacts with Germany is keen.

Baghdad has pressed Berlin to abandon its official warning against travel in the still volatile Middle Eastern nation.

"It handicaps economic development, the German government should allow German companies to decide for themselves if they want to go to Iraq," Hariri said last month during a visit to the German capital.

"In the end, it only results in Germans losing contracts, while Iraq, where German products have a good reputation, buys machines from China, Korea or eastern Europe," he added.

Eckhart von Klaeden, foreign affairs spokesman for the conservative Christian Democratic parliamentary group, said German firms should begin getting back to Iraq step-by-step.

"We need to begin by going where it is relatively safe," such as in Kurdish-controlled areas of northern Iraq.

"As more regions become prosperous, they will set an example for the most dangerous ones and a virtuous circle will take over," he forecast.

Israeli Soldier Filmed Shooting at Blindfolded Palestinian

A human rights group has released a video that shows an Israeli soldier firing a rubber-coated bullet from close range toward the feet of a bound, blindfolded Palestinian man.

The Israeli military said Monday it was investigating the video, taken two weeks ago, and described the shooting as a "stark violation" of army rules.

The Palestinian, Ashraf Abu Rahmeh, said Monday he was shot in one of his left toes and treated at the scene. During an interview, Abu Rahmeh, 27, took off his shoe and showed a large blister on his toe, with bruising underneath. He said for several days after the shooting, the toe was swollen.

The shooting took place on July 7, on the outskirts of the West Bank village of Naalin, said Abdullah Abu Rahmeh, a relative of the injured man. At the time, several dozen Palestinians including Abu Rahmeh participated in a protest against Israel's separation barrier, which is under construction near Naalin and will eventually cut off the village from hundreds of acres of its land.

In recent weeks, Naalin has been the site of frequent clashes between Palestinian protesters and Israeli troops. In the incident two weeks ago, soldiers imposed a curfew and then fired tear gas, stun grenades and rubber-coated steel pellets to disperse protesters marching toward the village, said Abdullah Abu Rahmeh, who was at the scene.

Toward the end of the clashes, Ashraf and another Palestinian man were detained by Israeli troops, Abdullah Abu Rahmeh said. Ashraf was led to an army jeep, blindfolded and handcuffed, said Abdullah Abu Rahmeh. Ashraf was held in this way for about three hours, his relative said. Abu Rahmeh said he was then shot.

A Palestinian girl filmed the scene from her home near the jeep, according to the Israeli human rights group B'Tselem, which obtained the footage.

The video shows Ashraf standing with the back to the camera, facing the jeep, while an Israeli army officer holds his arm. Another soldier slowly takes aim from a yard away and shoots toward Ashraf's feet. With the sound of the shot, the camera loses focus, and the next clear frames show Ashraf lying on the ground as Israeli soldiers lean over him.

"They shot me in the foot, in the toe," Abu Rahmeh said.

B'Tselem spokeswoman Sarit Michaeli demanded that the military take steps against both soldiers, the shooter and the one seen holding Abu Rahmeh's arm.

The army said military police are investigating.

The incident "is atypical and unacceptable and does not represent the Israel Defense Forces or its values," Barak told lawmakers from his Labor Party on Monday, according to a statement released by his office.

However, Palestinians have long complained of excessive force by Israeli troops in quelling Palestinian protests.

Israel has been building the separation barrier since 2002, saying it's a temporary defense against Palestinian attackers. However, the barrier extends into the Palestinian West Bank (illegally occupied by the Israeli military), incorporating illegal Jewish settlement blocs and seizing land from Palestinian villages, which suggests it's a land grab and an attempt by Israeli to draw its border unilaterally.

Is the Global Oil Crunch a Myth?

The popular perception of the recently skyrocketing oil price is that there is an oil shortage in global energy markets. The perceived shortage is generally blamed on the Organization of Petroleum Exporting countries (OPEC) for "insufficient" production, or on countries like China and India for their increased demand for energy, or on both.

This perception is reinforced--indeed, largely shaped--by the Bush administration and its neoconservative handlers who are eager to deflect attention away from war and geopolitical turbulence as driving forces behind the skyrocketing energy prices.

Impressions of an oil shortage are further bolstered by Wall Street and its financial giants that are taking advantage of the insecurity created by war and geopolitical turmoil in oil markets and are making fortunes through manipulative speculation in commodity futures markets.

Perceptions of insufficient oil supply are also heightened by the recently resuscitated theory of the so-called Peak Oil, which maintains that world production of conventional oil will soon reach--if it has not already reached--a maximum, or peak, and decline thereafter, with grave socio-economic consequences.

However, claims of an oil shortage are not supported by facts. Evidence shows that, in reality, there is no discrepancy between production and consumption of oil on a global level. Citing statistical evidence of parity between production and consumption of oil, OPEC President Chakib Khelil recently emphasized that there was no shortage of oil: "As far as fundamentals are concerned I think we have equilibrium between supply and demand. . . . In fact right now we have more supply than demand."

Facts of abundant oil supplies in global markets are now also being acknowledged and reported by mainstream media. For example, Ed Wallace of Business Week recently reported that "that worldwide production of oil has risen 2.5% in the first quarter, while worldwide demand has grown by only 2%. Production is expected to increase by 3.3% in the second quarter, and by as much as 4.1% by the third quarter. The net result is that the US daily buffer for oil production against demand, which was a paltry 1.5 million barrels as recently as 2005, is now up to 3 million barrels in excess capacity today."

Wallace then asks, "So what is going on here? Why would our Energy Secretary say there's a supply and demand problem when none exists? Why would he say that speculators have little or nothing to do with the incredibly high price of oil and gasoline, when it's clear they do? President Bush--a former oilman--gives the ever-growing demand for gasoline as the primary reason prices are so high, yet that notion can be dispelled with one minute of research."

So, if indeed there is no imbalance between production and consumption of oil in global markets, how do we then explain the skyrocketing oil prices?

The answer, in a nutshell, is: war and geopolitical instability in oil markets. Contrary to the claims of the champions of war and militarism, of the Wall Street speculators in energy markets, and of the proponents of Peak Oil, the current oil price shocks are caused largely by the destabilizing wars and political turbulences in the Middle East. These include not only the raging wars in Iraq and Afghanistan, but also the danger of a looming war against Iran that would threaten the flow of oil out of Persian Gulf through the Strait of Hormuz.

Close scrutiny of the soaring oil prices shows that anytime there is a renewed US or Israeli military threat against Iran, fuel prices move up several notches. For example, Agence France-Press (AFP) recently reported, "Crude oil prices went on a record-setting surge Friday as fears of a new Middle East conflict were fanned by comments from a top Israeli official about Iran. New York's main oil futures contract...leapt 10.75 dollars a barrel--its biggest one-day jump ever."

War and political chaos in the Middle East tend to increase energy prices in a number of ways. For one thing, as war plunges the US deep into debt, it depreciates the dollar--thereby appreciating, or inflating, the price of dollar-denominated commodities, especially oil.

Depreciated dollar tends to raise the price of oil (and other commodities) in two major ways. First, since oil is priced in US dollars, oil exporting countries would demand more of the cheaper dollars for the same barrel of oil in order to maintain the purchasing power of their oil. Second, when the dollar falls, oil prices rise because investors are more likely to use their money to buy tangible assets or commodities such as oil and gold that won't lose value.

According to a number of energy experts, between 30- and 40-percent of the recent increases in the price of oil can be attributed to dollar depreciation. One of the simplest ways to calculate this is to compare the price per barrel of oil in dollars and euros over the last five years. "The widening gap between the two [dollar price vs. euro price] indicates that 35 percent of the increase in the price of oil could be attributed to currency [dollar] devaluation."

Stronger than the impact of dollar depreciation on the price of oil has been the impact of manipulative speculation: war and political instability have served as breeding grounds for hoarding and speculation in energy futures markets. According to F. William Engdahl, a top expert on energy and financial markets, "As much as 60% of today's crude oil price is pure speculation driven by large trader banks and hedge funds. It has nothing to do with the convenient myths of Peak Oil. It has to do with control of oil and its price. . . . Since the advent of oil futures trading and the two major London and New York oil futures contracts, control of oil prices has left OPEC and gone to Wall Street. It is a classic case of the tail that wags the dog."

US Representative Bart T. Stupak, Democrat - Michigan, chairman of the subcommittee investigating commodity market speculation, attributes even a higher percentage of the oil price hike to market manipulation: "Speculations now account for about 70% of all benchmark crude trading on the New York Mercantile Exchange, up from 37% in 200."

Wall Street financial giants that created the Third World debt crisis in the late 1970s and early 1980s, the tech bubble in the 1990s, and the housing bubble in the 2000s are now hard at work creating the oil bubble. By purchasing large numbers of futures contracts, and thereby pushing up futures prices to even higher levels than current prices, speculators have provided a financial incentive for giant futures traders to buy even more oil and place it in storage.

Unrestrained by an appalling lack of regulation, this has led to a steady rise in crude oil inventories over the last two years, "resulting in US crude oil inventories that are now higher than at any time in the previous eight years. The large influx of speculative investment into oil futures has led to a situation where we have both high supplies of crude oil and high crude oil prices. . . . In fact, during this period global supplies have exceeded demand, according to the US Department of Energy."

The fact that the skyrocketing oil prices of late have been accompanied by a surplus in global oil markets was also brought to the attention of President George W. Bush by Saudi officials when he asked them during a recent trip to the kingdom to increase production in order to stem the rising prices. Saudi officials reminded the President that "there is plenty of oil on the market. Iran has put some 30 million barrels of oil that it can't sell into floating storage. 'If we produced more oil, it wouldn't find buyers,' says the Saudi source. It wouldn't affect the price at all."

And why producing more oil "wouldn't affect the price at all"? Well, because what is driving the soaring oil prices is not shortage but speculation: "with so much investment money sloshing around in the commodities markets, the Saudis calculate they have no hope of controlling short-term price fluctuations. They blame the recent price run-ups on speculation and fear of shortages [not real shortages], factors they say are beyond their control."

To sum up, manipulative speculation and dollar depreciation account for most of the recent increases in the price of oil--speculation accounts for nearly 60 percent, dollar depreciation for almost 40 percent. This is no longer a secret. What remains largely a secret, and needs to be exposed, however, is the relationship between speculation and dollar depreciation, on the one hand, and war and geopolitical instability, on the other.

While it is important to point out the impacts of dollar depreciation and commodity speculation on the price of oil, it is even more important to show that both of these factors are byproducts of war and militarism. Not only has the war played a critical role in the weakening of the dollar (through plunging the US deep into debt), it has also created favorable grounds for manipulative speculation in commodity markets, especially energy markets.

Therefore, while efforts to curb speculation in energy markets (through regulation of the largely unregulated futures markets) or buttress the dollar from further declining may sound comforting, such efforts will remain illusive and ineffectual unless the devastating wars and military adventures in the oil-rich Middle East are terminated; that is, unless the root causes of currency depreciation and commodity speculation are exposed and cut out.


Happy Holidays!