The interconnections between oil, Israel, and the United States are profoundly complex. They are the rich materials that Irene Gendzier, a longtime observer of the Middle East, analyzes in this provocative volume. She focuses on the crucial period 1945 to 1949 during which Israel was founded as a modern nation-state, and the US government made the decision to recognize it diplomatically. In doing so, US policymakers faced a difficult choice between the interests of its oil industry and the desire to support the Zionist cause—or did they?
The central claim of this book is that “the choice facing policymakers was not oil versus Israel but rather oil and Israel. In the years that followed, it was oil and Israel versus reform and revolution in the Arab world” (p. xviii). Indeed, once Truman recognized the Provisional Government of Israel as a de facto authority on 14 May 1948, the game changed significantly. Prior to that date, Gendzier argues, the United States endorsed the repatriation of Palestinian refugees in accord with UN General Assembly Resolution 194. After Israel's declaration of independence, however, the government decided to rethink Israel's military potential as a strategic ally. And crucially, it was oil interests in the Middle East that the United States wanted most to defend against outside powers, especially the Soviet Union. Having made the decision to recognize and back Israel, the United States then saw Israel as a strategic partner in the job of defending US oil interests in the Middle East, if push came to shove. Naturally, according to Gendzier, Washington subsequently decided to defer to Israel with respect to the repatriation of Palestinian refugees, the question of boundaries, and the fate of Jerusalem—issues that continue to haunt Arab–Israeli relations to this day.
A central insight animating the book's analysis is the recognition that economic interests (i.e., oil) were a guiding force in US policy towards the entire region. She writes, “In the immediate postwar years, the United States defined its policy in the Near and Middle East in terms of assuring unimpeded access and control by U.S. oil companies of its great material prize, petroleum” (p. xvi). She provides strong documentary evidence to support that claim, including an unequivocal statement by Philip Jessup, then the US special delegate to the United Nations (p. 318). Her identification of the primacy of oil in US policy in the Middle East during this period (and the rest of the 20th century) is correct.
Her decision to focus on the short period 1945–1949 is justified by the importance of that era for subsequent affairs in the Middle East, with reverberations around the world. She points out that no event has marked modern Arab politics more profoundly than the Arab–Israeli War of 1948 and the associated Palestinian refugee flight. Those events laid the foundations for the many subsequent Arab–Israeli wars, the nature of the Cold War in the Middle East, and much else besides.
Gendzier also has an eye for detail. She describes, for instance, how Eliahu Epstein lobbied to convince Max Ball, a key official in charge of the Oil and Gas Division of the Department of the Interior, to accept the future state of Israel as consistent with the interests of the United States. Epstein argued that an Arab triumph over the Jews in Palestine would be detrimental to Western interests because it “would increase Arab self-reliance, demands, and bargaining power, whereas the imposition of the will of the UN by the loyal implementation of the partition scheme would have a soothing effect on the Arabs and make them regain their right sense of proportion” (p. 105). Nearly seventy years on, it is hard to see any evidence of that “soothing effect.”
The book's claims towards oil politics are complex. Consider three central ones. First, there is the issue of whether policymakers faced a choice of oil vs. Israel. Here Gendzier runs into trouble. There is some truth to her claim that “the prevailing assumption with respect to U.S. policy toward Palestine, according to which U.S. officials feared that support for Zionism and partition of Palestine would undermine U.S. oil interests in the Arab world, proved to be a false assumption” (p. xx). In the event, as Gendzier shows, the oil companies proved pragmatic and willing to work with the fact that the government had chosen to recognize Israel. That is not, however, the same thing as saying there were no risks or tradeoffs involved. As Gendzier later acknowledges, US policy did create risks for its oil companies. Only through some clever negotiations and the help of their Saudi Arabian friends did the oil companies come up with a diplomatic formula for distancing themselves from their government's Israel policy, namely that “the oil companies were private corporations and did not represent the U.S. Government” (p. 110). This logic allowed the Saudis to oppose the Iraqi delegate at the Arab League, who proposed that the contracts to US oil companies should be canceled. The fact that canceling contracts was a live option for Arab governments meant very real risks did exist, even if they did not come to pass in the short-run. (In the long-run, Arab nationalization of the oil industry would cost the oil majors a great deal.) No wonder, then, that the bulk of the US oil industry had opposed recognition of the state of Israel, even if not all members of the industry agreed. In short, Gendzier's conclusion that there was never an “oil versus Israel” choice is misleading.
A second important claim is that US officials, after 1948, rethought Israel's “strategic potential” for the protection of American oil interests. Again, there is some truth to this position. The officials correctly assessed that Israel was militarily stronger than its Arab neighbors, and therefore wanted it as an ally. Importantly, they did not want Israel to “go Communist” or ally itself with the Soviet Union. And in the event of a major war in the Middle East, especially against the Soviet Union, the United States might have wanted Israel to serve as a military base. Yet this does not mean, as Gendzier implies, that US policy was oriented toward “Israel and oil” in some symbiotic way. On the contrary, US support for Israel eventually became a major obstacle for its oil industry, ultimately leading in the 1970s to a wave of Arab countries deciding to nationalize their oil sectors. Those nationalizations were profoundly costly to the oil companies, such that the major Western oil companies today control about 7 percent of the world's oil reserves, down from roughly 90 percent in the 1950s. And while it is true that Israel could have served as a military base for protecting the Middle East, the United States subsequently developed lots of other bases, including many in the Persian Gulf. It is therefore not clear that Israel's “strategic potential” was so crucial to subsequent US policy.
A third claim is that oil interests were what caused US administrations after 1948 to defer to Israel on its policies regarding the repatriation of Palestinian refugees, territorial boundaries, and Jerusalem. This claim is not proven. Mere correlation (of oil interests and deferral to Israel) does not prove causation. There could have been other factors that caused deferral to Israel in the wake of its independence. It is at least possible that the Israel lobby within the United States shaped policy significantly, and would have done so independently of America's oil interests. The difficulty is that the counterfactual—a world in which the United States did not have strong oil interests in the Middle East—is so unknowable that it makes it hard to be certain. What we can say, however, is that American deferral to Israel, more or less, continued for many years afterward—including after the United States had many military bases in the Persian Gulf, thereby reducing the utility of Israel as a military base. So it is not clear that oil interests were the cause of American policy toward Israel, though it probably did generate important incentives in those early crucial years after 1948.
In sum, this book struggles with some vitally important questions that are difficult to answer with a high degree of confidence. It is not clear that the book gets all of the answers right. Nonetheless, this book makes a valuable contribution by focusing our attention on the pervasive role of the oil industry in shaping US policy towards the Middle East, even toward countries that do not themselves have much oil. The author makes a compelling case that such interconnections have gone underappreciated for far too long.
