With the oil price heading upwards and President George W. Bush heading for Saudi Arabia, as part of a Middle Eastern tour, it is time to accept the truth. The pursuit of oil is fundamental to US foreign policy.

The importance of oil to American foreign policy is both obvious and curiously difficult to acknowledge in public. In the run-up to the Iraq war it was left to the left to make the argument that this was a “war for oil”. Establishment people – those in the know – rolled their eyes at this “conspiracy theory”.

Yet in recent months, both Alan Greenspan, former chairman of the Federal Reserve, and Senator John McCain have come close to saying that Iraq was indeed about oil. In his memoirs Mr Greenspan said he regretted that it was “politically inconvenient” to acknowledge that “the Iraq war is largely about oil”.

The remainder of this column can be read here. Please post comments below.

I am in Abu Dhabi - and so are the Opec oil ministers, or they were until a few hours ago. For those of you who have got your Emirates in a twist - Abu Dhabi is bigger and less flashy than Dubai. It also has far more oil - almost 10% of the world’s reserves, plus 5% of its natural gas.

So there is quite a lot of spare cash here. Abu Dhabi’s Sovereign Wealth Fund is thought to be the largest in the world - bigger than China’s. Nobody knows quite how much money it has to spend. But the lowest estimate I’ve heard is $500 billion - and the highest is $1 trillion. They recently snapped up 4.9% of Citigroup, and already own bits of Ferrari and the Carlyle Group.

The Emirates Palace Hotel, where Opec were meeting, is easily the most opulent hotel I’ve ever visited. Even part of the driveway is made of marble - a Porsche Cayenne trying to brake on marble makes a very loud squeak. The lobby (also all marble, naturally) is the size of a football field. The pianist there looked a bit like Condi Rice - although I dont think it has quite come to that, yet. One journalist who was staying at the hotel was startled to find a butler hovering in her room - asking her what temperature she would like her bath to be run.  (She said that, on balance, she would prefer a shower - and he made his excuses and left.)

Given all this, it was a little hard to swallow when Opec people tried to argue in favour of the current high oil price, on the grounds that their members need more cash to spend on schools and hospitals. The Emirates Palace hotel alone cost $2 billion to build. Of course, there are Opec members that are genuinely still quite poor - Iran, Ecuador etc. But pleading poverty in Abu Dhabi is tricky.

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People facing alarming birthdays often say things like: “Forty is just a number.” You could say the same about “$100 oil”. But such benchmarks concentrate minds. As the oil price threatens to break through $100, politicians all over the world will think hard about the strategic consequences.

So what is likely to happen? The biggest single effect is obvious. Oil producers become richer and more powerful. The biggest oil consumers – the US, China and the European Union – become increasingly anxious. Beneath that big trend, there are smaller effects that could change the course of some of the most delicate and dangerous problems – Iraq, Iran, China’s foreign policy and the resurgence of Russia.

The effects of a rising oil price on the economies of the producing countries are dramatic. The Organisation of the Petroleum Exporting Countries made $650bn from oil sales in 2006, compared with $110bn in 1998. Russian oil and gas revenues have quadrupled over the same period.

When bad governments make good money, they become more relaxed at home and more assertive abroad.

The remainder of this column can be read here. Comments can be made below.

I’m struggling a bit today. By Wednesday afternoon, I like to have a vague idea of what my column next week will be about. But I’m feeling uninspired. Of course, it is quite likely that there will be a rush of news later this week, which will provide an obvious topic. Last week, for example, by the weekend there were three good subjects – Benazir’s bloody return to Pakistan, the Polish elections, the signature of the new EU treaty. In the end, I ignored them all. But, if required, I’m sure I could have worked anyone of them up into a column of the required standard (β++∕∂-?).

At the moment, I am reduced to reading over my dog-eared list of “ideas for future columns”. The one I feel most like reviving at the moment is the article on what’s wrong with Bono. This got quite a big reaction when I first suggested it on the blog a few weeks ago – so there is an archive of stuff for me to work through. Also, I’ve just been forwarded a new article on celebrities in global politics, which looks promising. But I have had another idea, which at least has the merit of being new – the potential impact of $100 oil on global politics.

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