The Squeeze: Oil, Money and Greed in the 21st Century by Tom Bower

Tom Bower is the great destroyer of reputations. Richard Branson, Gordon Brown and the entire British football industry have been among the many targets of his investigative wrecking ball. So it is hardly surprising that he should have finally turned his attention to Big Oil, the most hated of all businesses ever since the first Texas gushers at the dawn of the last century.

The trouble is that there have been countless volumes on the wickedness of the oilmen and their mucky trade, most notably Ida Tarbell’s 1904 trailblazing dissection of the business methods of John D Rockefeller, which led directly to the US government breaking up the Standard Oil monopoly. Bower, wisely — and surprisingly, given his usual method — has not written yet another hatchet job. While his title promises exactly that, he has turned out a very balanced account of the wheeling and dealing between Big Oil and Big Government.

Better still, he manages to show that the latter is if anything much more unscrupulous — and certainly of much less benefit to the general population. More than 20 years ago, I was the FT’s energy correspondent and became entranced by the astonishing creativity of the oil industry’s geologists and engineers, as they devised technologies to find and produce hydrocarbons in the most hostile territories on earth. I also formed the view that the oilmen themselves, while not the most cultured people on the planet, had a stronger code of ethics than the politicians they scrapped with. The point was that the men in hard hats had no pretensions about acting for the general good — but in the manner laid down by Adam Smith, their single-minded pursuit of profit raised the living standards of all.

That is what made the rebranding of BP as Beyond Petroleum so infernally irritating: it seemed obvious at the time that this was spin motivated by fear of organisations such as Greenpeace, which had — with a mixture of ignorance and opportunism — wrought such havoc on Shell over the entirely safe disposal of the Brent Spar oil platform. As Bower notes, over the past two years Shell and BP have mounted a rapid retreat from their green postu-ring: Shell has sold its solar business and its stake in a planned giant wind farm called the London Array, while BP has closed its “renewable headquarters” at County Hall.

BP’s volte-face owes much to a change at the very top. John Browne, the chief executive ousted by a brutal boardroom coup in 2007, had become too close to the political process — he even became a legislator, via the House of Lords — and had begun to see his role as saving the planet, rather than just BP’s shareholders. If there is a dominant character in this book it is Browne; and although Bower paints him as a man of insupportable arrogance, I believe the tiny tycoon deserved the accolades he received in his pomp. His decisions to take over such significant US oil firms as Amoco and Arco were bold and brilliantly timed, while his push into Russia has produced such vast royalties that even if BP’s Siberian interests were expropriated by the Kremlin tomorrow, it would still have been a fantastic deal for British shareholders.

According to Bower, Browne was forever challenging people, shouting things such as “Don’t they know who I am?” I find this implausible; my own knowledge of the man is that he loathed confrontations — perhaps too much — and at all times kept his emotions under tight control. That, however, would have made for a less racy narrative — and Bower is always avid to re-create explosive meetings in which various powerful men threaten each other noisily.

The author, moreover, has his own sources, as he tells us, repeatedly: “As I interviewed nearly 250 people across the world… After interviewing nearly 250 people…I interviewed about 250 people”. We get the point: there’s nobody more diligent than Bower. It would have been good if one of those 250 people had told him that Ghawar (in Saudi Arabia) is not the “world’s biggest oilwell” — the word is “oilfield” — and that the controversial series of FT articles canonising Browne was published in 2002, and not, as Bower claims, in 2006 as part of Browne’s campaign to delay the appointment of a successor.

Never mind: Bower gets the big strategic judgments right, most admirably in his scepticism about the fashionable theory known as “peak oil”. It is inevitable that there will come a time when global oil production reaches a point that will not be exceeded, but ever since the modern oil business began, geologists have consistently underestimated the true extent of theplanet’s hydrocarbon resources — and man’s astonishing capacity for engineering innovation. As one oil-industry chief puts it, we can’t know what “peak oil” will be until we know the peak of technology.

So Big Oil will be around for generations yet to come — unless the politicians really do decide to close it down for good; but then, how will they replace all those lovely petroleum taxes?

The Squeeze: Oil, Money and Greed in the 21st Century by Tom Bower

HarperPress £20 pp410

Available at the BooksFirst price of £18 (inc p&p) on 0845 271 2135

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