The crude politics of Iraq’s oil

The fall of Saddam Hussein in 2003 should have meant that Iraqi oil workers would be free to organise unions, and protect their jobs in a national industry devoted to financing the reconstruction of the country.

Instead, Hassan Juma’a, the head of the Iraqi Federation of Oil Unions (IFOU) based in Basra, was hauled into a courtroom earlier this month, and threatened with prison for organising strikes.

The union he heads is still technically illegal, since Saddam’s ban on unions in the public sector was his one law that the US occupation kept in place, and then handed on to the administration of Nouri al-Maliki who has been Prime Minister of Iraq since 2006.

And the oil industry? The big multinational petroleum giants now run Iraq’s oilfields.

In 2010, the Maliki government began granting contracts for developing existing fields and exploring new ones to eighteen companies, including ExxonMobil, Royal Dutch Shell, the Italian energy company Eni, Russia’s Gazprom and Lukoil, Malaysia’s Petronas and a partnership between BP and the Chinese National Petroleum Corporation.

US corporations won two of the eighteen contracts, while US military protection provided the security umbrella protecting all of their field operations.

The Iraqi oil ministry still technically owns the oil, but it functions more as the multinationals’ adjunct, while stripping workers of their rights.

As the oil corporations rush in to lay claim to developing fields, ministry spokesman Assam Jihad told the Iraq Oil Report “unionists instigate the public against the plans of the Oil Ministry to develop [Iraq’s] oil riches using foreign development.”

As a result, in 2011, Juma’a along with Falih Abood, the president and general secretary of the Federation of Oil Employees of Iraq, were first hauled into court and threatened with arrest.

Juma’a said: “The government doesn’t want workers to have rights, because it wants people to be weak and at the mercy of employers.”

Many elected union officers were transferred from jobs they’d held for years to remote locations far from their families, in a government effort to break up its structure and punish activists.


The repression has been unsuccessful in stopping protest, however. This year the protests have escalated, both by workers objecting to broken promises of better wages and treatment, and by local farmers protesting the seizure of their land and the lack of jobs to replace their lost income.

In February hundreds of workers demonstrated on three separate occasions outside the building of the state-owned South Oil Company (SOC) in Basra, calling for its director and his aides to resign.

The company, managed by the national oil ministry, promised to build housing for workers, an urgent necessity in a province still recovering from war. Workers said they hadn’t been paid their normal bonuses for two years, and accused the company of hiring temporary workers, and then keeping them in that status indefinitely instead of giving them permanent jobs.

They also demanded better medical care, especially for those suffering the effects of exposure to depleted uranium. This heavy metal was used extensively in shells and other munitions by US forces, and war remains are still piled high in neighborhoods and across the countryside.

In one of the largest protests, union members joined farmers in a demonstration at the West Qurna 1 field, operated by ExxonMobil.mThey demanded higher payment for land taken to develop the field, and for jobs created by oil development. Mohammed al-Traim, the sheikh of the Beni Mansour tribe, told the Iraq Oil Report: "We have become farmers without land.”

Farming is the traditional occupation for most families in southern Iraq, who have been cultivating the soil there for hundreds of years. The Iraqi government set up a committee to compensate them, but farmers accuse it of grossly undervaluing their land.

"Compensation for one donum (six-tenths of an acre) is about one million Iraqi dinars (833 US dollars)," Abdul Sheikh told the publication. "But if we had the chance to grow tomatoes in that one donum, we could make more than five million dinars."

Others were offered compensation ranging from 80 US dollars to 1250 US dollars per donum. Meanwhile, ExxonMobil pumps 450,000 barrels a day from a field with reserves estimated at 8.7 billion.

Current crude oil prices hover at around 100 US dollars per barrel, giving the value of a day’s production at the field of 45 US dollars million. Such compensation levels might keep a family alive for a few months. But then what?


That dilemma fuels the demand for jobs, the source of ongoing conflict since the occupation started. Foreign corporations operating in Iraq have a long history of trying to bring in foreign workers.

The IFOU has led many fights since 2003 to force them to keep the native Iraqi workforce, and to hire from the local population. Although official figures put unemployment at around two milion (out of a general population of 31.7 million, of which 53.6 per cent are of working age according to recent UN figures), in reality it is significantly higher.

“There has basically been no change in the unemployment situation since the occupation started,” charges Qasim Hadi, who organised Iraq’s Union of the Unemployed (UUI) when the occupation began.

“There are more than 10 million unemployed people in Iraq - about 60-70 per cent of the workforce.”

According to the unemployed union, government unemployment statistics use exclusions to keep figures artificially low. “Women aren’t counted,” Hadi says, citing just one example, “because the government says their husbands or fathers are responsible for supporting them.”

The Iraqi government pays unemployment benefits, but only to a very limited number of households - about 500,000. Benefits are low, about 110 US dollars a month, and if there’s more than one unemployed person in the family, they reduce the benefits.

But the worst problem, the UUI says, is that you have to register with the governing political party at the same time you register for benefits. “If you oppose the governing party, you can’t register,” Hadi says. “Benefits are given out as political bribes.”

Global support for Juma’a

At first, government authorities denied rumors that they would punish workers involved in this February’s demonstrations. "We will not punish any protesters and all their demands will be fulfilled," Basra provincial council leader Sabah al-Bezzouni announced.

But after the largest of the Basra demonstrations took place on 27 February this year, the oil ministry moved to punish the union organising them. A Basra court issued charges against Juma’a and has given him until 7 April to find a lawyer.

Meanwhile Bezzouni sought to replace the union in negotiating over the workers’ grievances with the SOC. In response, unions across the world have protested against the threats to Juma’a and his union.

In a letter to Iraqi Prime Minister Maliki, they noted that eight other union protesters had also been summoned to the oil ministry “to investigate their role in recent demonstrations in Basra, where workers engaged in peaceful protest to express their legitimate demands.”

The letter reviewed the long history of the denial of workers rights since the beginning of the occupation, especially the enforcement of Law 150 banning unions in the public sector.

“The Iraqi government’s continued repression of freedom of association and worker rights, based on laws issued under a dictatorship, is in direct contradiction with the principals of democracy and justice that the Iraqi government promises its people,” it said.

“The government of Iraq should immediately cancel the orders issued by the Ministry of Oil to union activists, including all transfer orders, reprimands and arbitrary penalties against union activists. Charges against Hassan Juma’a Awad, and any other workers who have had retaliatory legal action taken against them, should be dropped.”

The letter was signed by the International Trade Union Confederation, the UK’s public sector union UNITE, Italy’s biggest labour federation, the CGIL, the US national trade union centre AFL-CIO and Labor Against the War, also in the US, among others.

The letter is still open for other organizations to sign, and can be found here.