Newsletter #76: OPEC and the Century of Oil, w/ Giuliano Garavini

By Michal Schatz

There is rarely time or space to take a step back from The Dig’s individual episodes and reflect on the bigger picture the podcast is piecing together, but Dan’s recent interview with Giuliano Garavini inspired me to indulge a little. One of the podcast’s major projects in recent years has been to weave together a comprehensive megahistory of the development and transformation of modern capitalism through examining the Global South. This recent episode provides a throughline to many of the discussions Dan has had with guests on these topics.

If you’ve already listened to The Dig’s latest two-part interview with Garavini, then you know that it covers a sweeping history of OPEC (Organization of the Petroleum Exporting Countries) and the twentieth-century emergence of petrostates, countries for which oil exports account for the majority of national income. If the nineteenth century was ruled by King Coal, the twentieth belonged to oil. Yet the story of oil’s rise as the world’s major energy resource is often siloed off from the century’s revolutionary and anti-imperial struggles. Breaking with this tendency, Garavini tells the history of the twentieth century through the lens of oil, shedding light on OPEC’s anti-imperialist origins and the unrealized hopes for global economic parity of its oil-producing member states from the Global South.

Listening to Garavini’s interview I was reminded of Dan’s discussions with numerous previous guests as Garavini guided us through oil’s rise as a major energy source, the formation of OPEC, and its initial anti-imperial ambitions, and why that early form of the project unraveled. Dan’s five-part interview with Eskandar Sadeghi-Bouroujerdi and Golnar Nikpour laid a strong foundation for an understanding of modern Iran and the relational dynamics of the Middle East more broadly. Kojo Koram detailed how British neoliberals reconstituted trade relations with former colonies in the aftermath of formal decolonization on imperial terms. Koram also demonstrated, as did Dig guest Quinn Slobodian, how neoliberalism arose fundamentally as a tool with which to quell the political and economic rise of newly liberated Third World countries. Through Dan’s conversation with Margarita Fajardo, we learned about the Latin American United Nations economists who formed the Economic Commission for Latin America and the Caribbean (CEPAL in its Spanish and Portuguese acronym) in an effort to rectify the unequal trade terms that the imperial countries impose on those of the Global South.

Listen to part one of this week’s *The Dig conversation here and part two here.*

Studying the twentieth century through the history of oil, as Garavini does, brings the broad sweep of all of these phenomena into singular focus. For example, motivated by the same vision as the CEPAL economists that Fajardo describes —— an equal position to that of the imperial powers in global trade —— Iran nationalized its oil industry in 1951 to the outrage of the British-owned Anglo-Iranian Oil Company. Two years later, the US and UK orchestrated a coup against Iranian prime minister Mohammad Mosaddegh in an attempt to reverse the industry’s nationalization.

At home, Britain’s Labour-controlled government was itself nationalizing various industries in a wave of post-war, pro-worker enthusiasm. This type of double standard for the colony and the metropole is not surprising, as Garavini points out, considering the British economy’s dependence on the revenue from Persian oil at the time. But as we know from Koram, these imperial countries’ hypocritical policies always eventually come home. Britain’s neoliberal era truly began when Margaret Thatcher infamously broke the coal miners’ strike of 1984-5. Listening to Garavini’s interview, I was particularly surprised to learn that Thatcher was able to do so in large part thanks to Britain’s then-recent discovery of North Sea oil. From there, Thatcher went on to privatize a wide range of the industries that Labour had nationalized while fighting Iran’s nationalization of their energy sector —– a project that subsequent Tory governments have proudly inherited. As we look towards decarbonization and the development of new energy technologies, hopefully we can learn from the oil century’s mistakes.

Further Reading

If you want to dive deeper into the history of OPEC and petrostates, read Garavini’s book The Rise and Fall of OPEC in the Twentieth Century. To learn more about the politics of oil in South America and the problems that resource dependency pose for left-wing governments, check out Thea Riofrancos’s book Resource Radicals: From Petro-Nationalism to Post-Extractivism in Ecuador. If you haven’t already listened to Dan’s interview with Timothy Mitchell on his book Carbon Democracy, do so here.