Why Would An Oil Industry Group Oppose Sanctions On Libya? (HAL, XOM, BP, COP, RDS.A)

When President Obama announced earlier this week that his administration would be pursuing harsh sanctions against Muammar Qaddafi's Libyan government in response to its brutal backlash against Libyan protesters, most had to agree that it was the correct course of action.

Most, that is, except for USA*Engage, a coalition with a membership reported to include Halliburton HAL, ExxonMobil XOM, BP BP, ConocoPhillips COP, and Shell RDS. The group has opposed unilateral sanctions, calling it a "failed strategy." It makes the point that the U.S. should instead work through the United Nations and follow a multilateral strategy. Speaking to Mother Jones, USA*Engage's co-chair, Bill Reinsch, said that, "When you act unilaterally, the odds of success are much lower — too many people out there are not on board."

However, when considering how much the group has to lose, cynicism is close to irresistible. USA*Engage does have a history of opposing unilateral sanctions when those sanctions have made it difficult for U.S. companies to operate in rogue regimes. The group is quick to cite political and humanitarian reasons for its frequent opposition to unilateral sanctions, but critics believe that its priority is its business interests. Reinsch defends this position by saying that, in the oil business, operating in dictatorial regimes is a necessity. "The reality is that the oil in all the nice countries has been exploited already, we can't drill anymore in Norway," Reinsch says.

Reinsch did call the violence that Qaddafi's government has conducted against the Libyan people "profoundly depressing," but when USA*Engage is so willing to continue doing operating in Libya, the sentiment strikes as profoundly hollow.