Sleeping With The Devil Read Free Page A

Station
    One sends the oil uphill, into the al-Aramah mountain range, so it can begin its long journey
    across the peninsula. Without a working pump behind it, the oil flows in the wrong direction.
        Even the short pipe run from Abqaiq to the Gulf terminals is not
    without opportunity. At Qatif Junction, a few kilometers inland from the coast, a manifold
    complex directs the flow of oil to Ras Tanura or Ju’aymah, or to the dormant Trans-Arabian
    pipeline. Inflict heavy damage on the complex and you’ll stop the oil in its tracks for months.
    Unlike the off-the-shelf pipes that connect the terminals and processing facilities, the
    manifolds and pipe junctions at Qatif Junction would require custom fabrication to replace.
        The assessments by the disaster planners were downplayed, for fear of
    rocking global oil markets, but you can bet they are not the only people to have calculated how
    much damage could be done to the Saudi petroleum chain - or the global money chain - by an
    expedient as relatively simple as blowing one of Abqaiq’s stabilizing towers, or Ras Tanura’s
    Platform Four, or the East-West pipeline’s Pump Station One to smithereens. (Or, of course, all
    three.) A single jumbo jet with a suicide bomber at the controls, hijacked during takeoff from
    Dubai and crashed into the heart of Ras Tanura, would be enough to bring the world’s
    oil-addicted economies to their knees, America’s along with them. Indeed, such an attack would
    be more economically damaging than a dirty nuclear bomb set off in midtown Manhattan or across
    from the White House in Lafayette Square.

        PROMOTERS OF ALASKAN, Mexican Gulf, Caspian, and Siberian oil sound
    like a broken record when they point out that the United States has been weaning itself from
    Saudi oil. They argue that Saudi Arabia accounts for only roughly 8 percent of U.S. crude oil
    consumption. They also argue that three of our four main oil suppliers are in the Western
    Hemisphere: Canada, Venezuela, and Mexico. True enough. But what they forget to mention is that
    Saudi Arabia sits on 25 percent of the world’s proven reserves, maybe barrel per barrel the
    cheapest oil in the world to extract. More important, the Saudis own half the world’s surplus
    production capacity - two to three million barrels a day. Take the Saudi surplus out of play,
    and the market loses its stability and liquidity. It may not seem like much oil, but the
    surplus capacity is what keeps the world’s oil markets from going on a facedown roller-coaster
    ride during periods of crisis. In other words, no matter what country you buy your oil from,
    Saudi Arabia determines world price by how much oil it chooses to produce.
        It was Saudi Arabia that broke the back of the 1973 OPEC embargo
    (though not before it enriched itself by tens of billions of dollars). As the Iranian
    revolution segued into Iran’s protracted war with Iraq, the Saudis again used their surplus
    capacity to keep the oil flowing to the industrialized West. By 1979-80, the Ju’aymah terminal
    on the Persian Gulf was shipping about nine million barrels of oil daily, twice its normal
    output.
        The same thing occurred during the 1990-91 Gulf War. The Saudis, backed
    by a couple of other Gulf states, produced an extra five million barrels a day, making up for
    the loss of Iraqi and Kuwaiti oil. Without its surplus capacity, the price of a barrel of oil
    likely would have soared to over a hundred dollars.
        On September 12, 2001, less than 24 hours after the attacks on the
    World Trade Center and the Pentagon, the Saudis put on the market an extra nine million barrels
    of oil, going mostly to the United States. As a result, oil prices stayed low, and U.S.
    inflation spiked marginally in spite of the single most devastating terrorist attack in
    history. Take that same liquidity out of play with twenty pounds of plastique, and all bets
    would be off.

        A DECEMBER 2000 study by