In 1990, when I was on the floor of the New York Mercantile Exchange, Saddam Hussein sent his 300,000 man army across an invisible surveyor’s line to annex his oil-rich neighbor, Kuwait.
The thought of Saddam Hussein controlling Kuwait’s oil wells was unacceptable. So, President George H. W. Bush cobbled together an international coalition of military power not seen since Vietnam to expel the invaders. Within six months, the decimated Iraqi army was hightailing it out of Kuwait, leaving behind some 35,000 dead soldiers baking in the desert sun.
The coalition victory was heralded as a triumph.
I recount these events in my new book “Life In The Pits: My Time as a Trader on the Rough and Tumble Exchange Floors.” For me, watching them unfold in real time from the constant news feed scrolling across the digital chyrons that hovered over the chaotic Crude Oil trading rings, the question I wrestled with was, why did we care at all? It certainly couldn’t have been humanitarian concerns alone.
To be sure, Saddam was a terrible man. Yet, during the same time period the world had many other reasons to be outraged, but we were focused on Kuwait. Why?
The answer was as simple then as it is now: The reason the plight of a tiny, wealthy emirate on the Persian Gulf mattered to the point of mobilizing the world to protect it was that Kuwait had oil.
The quest for oil as a catalyst to global upheaval is nothing new.
Why did mighty Japan gamble on going to war with the U.S.? Answer: Oil. For Japan, a nation that imported 90% of its energy, the U.S.-led oil embargo in protest of Dai Nippon’s brutality in China was crippling. Thus the need to strike south into the oil-rich Dutch East Indies to secure their dwindling energy reserves. To accomplish this, the Imperial Navy tried neutralizing its greatest threat to Japanese expansion: the U.S. Pacific Fleet at Pearl Harbor. Four years later, her cities were smoldering ruins, her navy at the bottom of the sea, and U.S. warships were anchored in Tokyo Bay.
Why did Hitler send his Sixth Army surging into southern Russia one year after Pearl Harbor? He wanted to seize the oil fields of the Caucuses. Instead, he watched in a helpless rage as his largest formation in the Wehrmacht was surrounded inside the ruined city of Stalingrad and wiped off the face of the frozen steppe. After Stalingrad, Hitler’s Third Reich was doomed. Once again, the lack of energy independence led to a nation’s ultimate destruction.
And China’s current economic outreach in Africa is a scheme to grab the energy resources they do not have within their borders.
Indeed, the epicenter of so many modern conflicts, and a source of constant tension and strife to this day, is the global scramble to secure energy.
Which brings us to the continued importance of the Middle East. The reason America remains so involved in a region that a century ago was barely on our radar — and into which we pour tens of billions of U.S. tax dollars each year — is because of the black sludge beneath the Arabian desert and Iranian hills.
We see Putin’s undue influence over powerful NATO members like Germany stemming from Russia being the source of so much natural gas to the E.U., without which they would be plunged into a cold dark winter. And so it goes. Those who have their hands on the crude oil and natural gas spigots exercise disproportionate influence over the world.
With friendly energy producers along both borders, and the oceans as a buffer, the United States is better positioned than any other country on earth to achieve not just energy independence but total self-sufficiency. When that happens, entire priorities regarding foreign affairs will be upended in favor of the interests of the American people over those seeking perpetual war, living under the jackboots of authoritarian regimes.
Regardless of short-term environmental impact, the quest for sustainable energy self-sufficiency should be the goal of any administration or political party that claims to have the interests of the citizenry at heart. This means building new refineries better suited to the new grades of crude coming from the shale revolution. We currently export this sweeter grade and must import a lot of the sour crude.
As I see it, being truly energy independent is more than just importing less than we export. It means not needing to import any at all. With Canada and Mexico sitting atop 174 billion barrels of crude and 88.4 TCF of natural gas, North America need never import another gallon or MMBtu again.
Thanks to the shale boom which began in earnest in the early 2000s, by 2019 the U.S. actually produced more energy than it consumed for the first time since the 1940s. By 2022, even more so, with the U.S. producing 2.5% more than it consumed. This is no fairy tale vision. We simply need the political will to sustain it.
Shale has provided the keys to unshackle our chains tying us to the Middle East, a region that allegedly prefers we not be there at all. Fine with me. Perhaps we would be better served with our military patrolling the Rio Grande and Gulf of Mexico rather than the Euphrates and the Persian Gulf.
As with so many terror attacks, Hamas’ brutality in Israel — which should repulse all civilized people without any qualifiers — was financed by money gushing from oil-dependent nations to Qatar, the UAE, Saudi Arabia, and, of course, Iran. In Ukraine, Putin’s military is funded by money flowing through his natural gas pipelines into the E.U.
Speaking before the U.N. in 2018, President Trump warned the Western powers, Germany in particular, of the dangers of dependency on energy courtesy of a potentially hostile foreign power, such as Putin’s Russia. The German diplomats literally laughed at his concerns. They are not laughing now.
The first Gulf War should have been a wake-up call to the U.S. It should have prompted us to embark on a program of complete energy self-sufficiency, so that the plight of ungrateful, duplicitous oil sheiks, maniacal dictators, and fanatical mullahs waging their oil-funded proxy wars against the West should have no influence over our own national security and foreign policy. Iraq. Afghanistan. Iran. All are flashpoints that continue to steer our nation’s inept foreign policy, while dragging us into one quagmire after another, mostly due to our drive to secure commodities of which we have more than we need literally right under our feet.
The U.S. has been given the gift of nearly 70 billion barrels in proven oil reserves as well as 368 TCF of natural gas. These are resources in abundance the other great powers, save Russia, do not have.
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If a young clerk on the floor of a hectic commodities exchange three decades ago could have the clarity to see our way out of these horrible wars in the Middle East, what prevents us from moving forward now when we are far better positioned to make my pipe dream a reality? One must ask. Had the U.S. never been dependent on foreign oil, would we have needed to ever be involved in one Mideast disaster after another? How much better would our lives be, and the state of this nation, were we to slip free of the yoke of energy dependence?
In time, technology will make green solutions a reality. But until that happens, we must do what is best for the U.S. As history has shown, at least before oil became a factor, what is best for the U.S. ultimately is best for the world. And certainly best for the average American who should never again salute a flag-draped coffin, courtesy of the latest unnecessary war in a far-off land that, but for oil, we should have little use for in the first place.
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Brad Schaeffer is a commodities trader and author. He has been featured in the Wall Street Journal, New York Daily News, National Review, The Federalist, The Hill, The Daily Wire, and Zerohedge among others. His newest book Life In The Pits: MyTime As A Trader On The Rough-And-Tumble Exchange Floors is now on sale everywhere.
The views expressed in this piece are those of the author and do not necessarily represent those of The Daily Wire.