Sweet and Sour: Libya: One of the most promising lands on the planet for investors

It was ironic to see Iraqis under U.S. occupation giving advice to Americans on how to cope with the heat during last week's power cuts in the north-eastern U.S. Well, the Americans got back to work and to normality after suffering a day of inconvenience but the same can't be said of the Iraqis, whose plight seems to get worse by the day.

Consider the events of this weekend alone. Two explosions along the main northern oil pipeline caused; a bombed water pipe; more shootings in Baghdad and Basra directed at U.S.-dominated coalition forces; a mortar attack on a prison.

All this on top of the looting and the smuggling of diesel oil while thousands of Iraqi motorists are back to waiting hours to fill up their petrol tanks because of an acute power shortage.

Oil exports from the southern oilfields are down to a trickle and any chance they might have had of restoring exports from the north have been stymied by the pipeline sabotage.

It is costing the Iraqis $7 million a day in lost revenue when it will take some seven billion to keep the oil industry going at pre-war levels, to say nothing of the cost of new development. Iraq's credibility as a stable oil supplier is being severely tested by these acts of sabotage and looting.

Surely this was not what Washington's neo-conservatives were after. Not this state of utter chaos in Iraq that has helped keep oil prices high enough to fill the coffers of the very same Arab oil-producing countries they would like to see on their knees.

While Saudi Arabia grapples with threats to its security from an Al Qaida that the U.S. has not totally exorcised, enter Libya.

This one time pariah state once considered by the Americans to be the biggest threat to world peace, is about to buy its way out of the diplomatic freezer through the Lockerbie settlement.
Granted the U.S. is not about to scrap its own unilateral sanctions against Tripoli but Colonel Muammar Gaddafi has taken a first step towards rehabilitation after he was knocked off his pedestal as the world's most dangerous man by Osama bin Laden and Saddam Hussain.

Yet Libya is one of the most promising foreign investment prospects remaining on this planet. Its production costs are among the lowest in the world and under-investment in its energy sector has left wide swathes of territory up for grabs by Western oil companies.

Gaddafi may have squandered his country's oil money building grandiose water projects and funding terrorist groups around the world but it is that same oil cash that has allowed him to buy his way out of trouble. Saddam Hussain was evil incarnate yet there is as yet not a shred of evidence that Iraq posed a direct threat to the U.S. Libya has accepted responsibility for one of the worst atrocities in recent memory and is being allowed to wipe the slate clean.

Would the world have been so forgiving if this were a barren land with no resources to speak of? I wonder.

The writer is Middle East Editor of energy information and pricing service, Platts, a division of McGraw-Hill Companies