Introduction

Oil is a keystone of a modern economy, but historical and geological accident determine where it is to be found. For a number of nations in the Third World oil provides the main source of wealth, and hence is a central concern of government. At the same time, the security and stability of oil supply pose a constant problem for the industrialized countries of the North. The Gulf War was just another in the series of dramatic events in oil history revolving around these two basic facts. Using the barrier model I focus on the part of oil history involving Third World states struggling to gain control over their petroleum industries. This struggle shifts from an emphasis on increasing revenues – royalties and taxes – to the additional demand for ownership and control. Pitted against these countries were the major oil companies and their allied governments, who in the beginning completely controlled and dominated the international oil system, but whose control by 1960 had seriously eroded.

The 1970s saw a dramatic change in the character of the oil industry. Oilproducing countries successfully challenged the system whereby the major oil companies controlled all aspects of the process which took oil from wellhead to gas station.