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The ‘Sting’ 381

sei up a committee of three members, Libya, Iraq and Kuwait, to conduct the
negotiations with the oil companies over prices. (The choice of this particular
trio was also tinged with irony; for Kuwait and Iraq were then at loggerheads
over an Iraqi military incursion into Kuwait territory. Squabbles of this kind,
it was obvious, faded into insignificance before the prospect of oil price
increases.) The committee - Izzedin Mabruk of Libya, Saadun al-Hammadi

of Iraq and Abdur Rahman al-Atiqi of Kuwait - met the oil companies at Cairo
in the latter half of April, when the companies were reported to have made an
offer of a 6 per cent price increase in accordance with the Geneva 1972 formula,
together with an additional 1.2 per cent as a sweetener. The three oil ministers
rejected the offer on 24 April and gave the companies ten days in which to come
up with ‘positive proposals’, which would be submitted to another special
OPEC conference said to be due to commence in Tripoli in early May. The
putative special conference was a blind, a ruse to put pressure upon the

companies. When the latter came forward with their proposals, the conference
was consigned to limbo. However, the committee of three declared the new
proposals also to be unsatisfactory, and the secretary-general of OPEC, the
Algerian Abdur Rahman Khene, chided the companies for their ‘negative’
attitude, saying that they had offered only the upper limit of the Geneva
formula, 6.6 per cent. This was not true: the companies had offered 7.2 per
cent at first, raising it to 8.1 per cent afterwards.
The fact of the matter was that the three OPEC ministers were not really
interested in reaching an amicable settlement. They had sensed, especially

after the shah’s bold and successful initiative against the Persian consortium,
that the companies were ripe for the plucking, and they were further whipped
into an aggressive mood by the exhortations and actions of the Libyan RCC,
working hand in glove with the Algerians. In the second week of May Qaddafi
threatened three of the Libyan operators - Oasis (Continental, Marathon,
Amerada-Hess and Shell), Amoseas (SOCAL and Texas) and Occidental -
with total nationalization at the net book value of their assets, adding that
thereafter they would only be able to buy Libyan oil at market prices. His oil

minister, Izzedin Mabruk, spoke of the companies’ ‘underhand man­
oeuvres’ and warned that OPEC would not hesitate to use every means at its
disposal (‘and our means are numerous’) to get better prices for its oil. Hinting
not too subtly at the possibility of a curtailment of production, he bade the
companies confine themselves to the role of ‘middleman’ between producing
and consuming countries - ‘if they do not want to become bankrupt’.
It was against this background of threats and blackmail that an article
was published in the April 1973 issue of Foreign Affairs by James Akins of the
State Department under the alarmist title of ‘The oil crisis: this time the
wolf is here’. Its principal theme was that everything that had happened
between OPEC and the oil companies in the preceding years had really

been for the best, and that the oil-consuming countries had better begin