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CHAPTER ONE The Reign of Big Oil The world of energy passed a critical milestone late in 1948. At about the time that Harry S. Truman was winning election to a full term as president, the United States became a net importer of crude oil and petroleum prod- ucts. The United States was one of the world’s largest producers of oil, as it is today. But just as U.S. officials had foreseen during World War II, the lines delineating its output and its rapidly growing demand crossed a few years after the war. Crude oil became the world’s most important commodity, and not just in the United States. Oil supplanted coal to become the fuel of the world’s commerce, powering the ships, motor vehicles, airplanes, and rail- roads that moved all other goods transported in a growing global economy. Oil fueled the reconstruction of Europe and Japan out of the ruins of war in the United States, it was the energy source for a booming economy of industrial expansion, family cars, suburban living, and long-haul trucks. For other commodities, there were alternatives: wheat could be replaced by other grains, lumber by other building materials. For oil, there was no substitute. Access to worldwide oil resources became an economic and strategic impera- tive for the United States. The importance of oil was matched by the cost and difficulty of obtaining it. Oil cannot be dug from the ground with hand tools, like some other min- erals. Nor can it be grown from seeds. Finding and producing oil requires knowledge of geology, substantial investments of capital, and access to drill- ing and refining technology that were far beyond the means of most of the countries where extensive reservoirs of “black gold” were to be found. Except in Mexico, which nationalized its oil industry in 1938, the oil business almost everywhere in the noncommunist world was controlled by a small number of well-endowed international corporations. These companies were based in the United States and Western Europe, but they operated