Book launch at Princeton

Conversations -formal and informal, over lunch or over Zoom- with Behrooz Ghamari-Tabrizi are always immensely fun: they are rich, go in unexpected directions and always invoke lots of new ideas, and lots of new ways of seeing even stuff I have written myself.

We had such a conversation a couple of weeks ago about Sinews. Here is the video:

https://mediacentral.princeton.edu/media/1_t0p2i14z

Posted in capital accumulation, empire, imperialism & colonialism, infrastructure, labour, Middle East, transport, war | Leave a comment

Brilliantly fun interview with Tank Magazine

Last month the brilliant Thomas Roueché interviewed me on Sinews for Tank magazine. The interview can be found here:

https://tankmagazine.com/issue-84/features/the-sinews-of-war-and-trade/

I am not reposting the content, because the piece has such cool graphics on their website!

Posted in capital accumulation, empire, imperialism & colonialism, environment, finance and insurance, infrastructure, labour, logistics, Middle East, political economy, ports, shipping conditions | Leave a comment

Interview with Doug Henwood for KPFA’s Left Business Observer


As always it is really fun to talk to Doug, given that he was a merchant marine in his youth, and he is a great conversationalist. We chatted for his Left Business Observer in early August and the conversation went live on on 27 August:

Fresh audio product

Posted in capital accumulation, construction, empire, imperialism & colonialism, infrastructure, logistics, Middle East, militaries, oil, political economy, shipping conditions, transport | Leave a comment

A review of Sinews of War and Trade in The Baffler

I was thrilled to see such a brilliant erudite review of the book by Harris Feinsod.

All at Sea

Surveying the watery expanses of the world economy

By Harris Feinsod, 24 August 2020

Sinews of War and Trade: Shipping and Capitalism in the Arabian Peninsula by Laleh Khalili. Verso Books, 352 pages.

THE INTERNATIONAL LABOR ORGANIZATION estimates that in spring 2020, the coronavirus drove a 14 percent decline in worldwide working hours relative to spring 2019, equivalent to some 400 million lost jobs. Yet as economists rushed to measure these staggering unemployment numbers, an inverse calamity unfolded out of view: a rash of workers forced to labor against their will. The International Transport Workers’ Federation claims that, in the midst of the pandemic, the shipping industry coerced at least 200,000 merchant seamen into contract extensions, denied them safe passage home to their families, or required them to forego medical care in port. Still ongoing, this de facto mass conscription resembles a large-scale restoration of the historic press gangs seen during the worst seasons of labor recruitment by the British Royal Navy, and later by the crimps and landsharks of San Francisco’s so-called Barbary Coast. As customs enforcement agencies tightened borders and shipping concerns endeavored to ward off a dreaded cycle of “deglobalization” this spring, each revealed a characteristic indifference to the marine workers who stoke the dynamo of world commerce.

If this neglect feels like an old story, that is because the seagoing edges of capital and colonialism, often sailing in cahoots, entail five hundred years of contempt for marine workers. We can trace these exploitative labor histories back to the sixteenth century, when chattel slavery, facilitated by marine transport, laid the groundwork for the expansion of European empires. Closer to our era, in the nineteenth century, the Egyptian public works department used “Corvée”—that is, unfree—labor to build the Suez Canal. In the early twentieth century, as soon as organized labor made gains for sailors, the flag of convenience began to fly: a legal instrument freed shipowners to open registries in Liberia or Panama, allowing them to circumvent national labor laws protecting seamen. Since the 1960s, the relentless marches of automation and containerization—the use of those now-ubiquitous boxes that streamline movement of goods from ship to shore—have again undermined dockworkers who had only just managed to decasualize.

In recent decades, as remote, securitized transshipment facilities like Dubai’s Jabal Ali have overtaken older, “break bulk” urban seaports—where goods flowed right out of the holds and off the docks into the metropolis—public scrutiny on maritime commerce has only diminished. Now out of view, container and tanker ports continue to be what Allan Sekula once dubbed globalization’s “forgotten space.” The political theorist Laleh Khalili credits this imperviousness partly to the sailor’s own fall from grace as a raconteur, hampered by the age of the container ship. “If there are no yarns to be spun,” she writes in her new book Sinews of War and Trade: Shipping and Capitalism in the Arabian Peninsula, “There is also scant possibility of telling stories over the deafening sound of the electric grinders or power hoses.”

Sinews offers one of the most outstanding recent investigations into the hard-to-narrate infrastructure of modern ports and their place in the patterns of global conflict and commerce. Much of her book concerns the post-World War II development of tanker, bulk, and container shipping along the coastlines of the Arab Peninsula, and the fantasy futures authored by the speculators, emirates, empires, and mercenary logistics companies that profited from it. Khalili’s deft and forensic investigation brings into focus how the region was shaped and in turn shaped the global energy economy in the age of oil. Moreover, she draws a bright line between regional military and trade networks, revealing the human cost of ordinary logistics. As she notes late in the book, “Quartermasters of capital are so often indistinguishable from the masters of trade.”


Aristotle Onassis talks with Patriarch Athenagoras. | Wikimedia Commons

Consider the origins of the term “Middle East.” It was popularized by the U.S. naval strategist Alfred Thayer Mahan, who used it in his 1902 article “The Persian Gulf and International Relations.” As On Barak points out in Powering Empire: How Coal Made the Middle East and Sparked Global Carbonization, what Mahan had in mind was not a region with cultural and political complexity—at the time, the Middle East was defined by complex arrangements between colonial powers and local Emirates and Sultanates—but a “string of British coaling depots” that supplied the steamships of her majesty’s then-expanding maritime empire. (Barak calls this coalonialism.) This understanding of the Middle East is defined by the ligatures traversing it, what the New York Times once dubbed Victorian Britain’s “sinew of empire.”

The discovery of oil in Bahrain, Saudi Arabia, and elsewhere across the 1930s and 1940s set off another wave of convulsive changes to peninsular logistics, as “titanic maritime infrastructures” developed atop the sinuous framework. Khalili addresses this process in a brilliant chapter titled “Harbour-Making.” She describes how firms like the Arabian American Oil Company (Aramco) and the Anglo-Iranian Oil Company (AIOC) partnered with late colonial governments and disunited emirates to transform the vast shallows of the Persian Gulf from a hinterland of dhows and lighters—where colonial Viceroys had to be carried ashore only to re-stage triumphal landings—into deep water harbors driving a ferocious new economy. Petro-harbors like Dammam and Ras Tanura in Saudi Arabia, and Mina Ahmadi and Shuwaikh in Kuwait, came to exemplify a carte blanche form of corporate sovereignty, as oil companies themselves got into the harbor-making business. By contrast, container ports like Dubai and Sharjah were products of competing emirates eager to secure advantageous access to trade from the British Empire. For Khalili, “in its constant scramble for ever-deeper harbours,” and “in its ruthless moulding, whittling, and carving up of sea into land and land into more land,” Dubai became a typical node in the worldwide imperial matrix of capital accumulation. Today, the seafloor ecologies of the region lie devastated after a century of nearly continual dredging operations.

Few personalities populate Sinews of War and Trade. Mostly, Khalili focuses on corporate and state actors in an  array of dull acronyms and indices—Aramco, BAPCO, Baltic Dry Index, and so forth—that require a glossary. One exception is the Greek shipping magnate Aristotle Onassis, better known as the second husband of Jacqueline Kennedy. Onassis brilliantly amassed a fleet of megatankers just before and after World War II, anticipating the postwar oil boom. In 1953, he secured a lucrative exclusive on the transport of Saudi petroleum, which upset everyone from the Dulles brothers to British Petroleum. Aramco claimed that its 1933 concession included shipping rights that invalidated the Saudis’ contract with Onassis; in 1958, an arbitration tribunal in Switzerland sided with Aramco, effectively valuing the company over the Saudis’ sovereignty. For Khalili, this is a paradigmatic case of how European law abetted multinational corporations as they ran roughshod over postcolonial states attempting to assert sovereignty over their resources.

Astutely, Khalili shows how this process recalibrated the old doctrine mare liberum (“freedom of the seas”), formulated in a 1609 treatise by Dutch jurist Hugo Grotius. In that earlier age of imperial conflicts, European powers like the Dutch had overridden traces of indigenous law to declare the sea universal property, thereby paving the way for its seizure. This process would be repeated in the 1950s, when the ocean floor around the Arab Peninsula was gradually transformed from a commons into a scene of jurisdictional claims by squabbling emirates keen to get into offshore oil drilling. Their pursuant struggles culminated in the UN Convention on the Law of the Sea (1958/1982), which formalized international regulations on the use of maritime resources. Even as it  promised a global commons, the law allowed only those world powers who commanded sufficient technical resources and capital to install the complex infrastructures of undersea extraction.

These submarine scrambles are only one of many “palimpsests of law and corporate sovereigns” that Khalili unpacks in her book. Equally crucial is the development of extralegal free trade zones and export processing zones, which enshrine a variable sovereignty over the corporations that make tax havens of them. Dubai’s Jabal Ali port is emblematic in this regard.

Hard to glimpse behind the layers of security, Jabal Ali is Khalili’s white whale. Escaping regulatory scrutiny, it hosts the frictionless capital accumulation of some seven thousand corporate entities, most foreign, who rely on the docility of laborers from Nepal and elsewhere hemmed in by forced migration. In a recent interview with the “Everyday Analysis” podcast, Khalili recounted that leaders of International Transport Workers’ Federation had encouraged her to look into Jabal Ali, justifiably concerned about the labor conditions there. She twice managed to call on the inaccessible port in her own travel by container ship. But many such ports, built out of view and often refortified with post-9/11 security enhancements, constrict admission for unassorted passengers and other observers.


Arabian Peninsula. | Tablespace

How did dockworkers and sailors fare in the new terrain of corporate sovereigns and remote megaports that emerged in the twentieth century? Khalili’s two chapters on landside and shipboard labor ripple with the tragic energy of workers disciplined by capital in one historical conjuncture after another, even as they erratically resisted. She follows historian Marcel van der Linden in tracing the plight of contemporary marine worker to racialized technologies of rule that created “unfree labour in the colonies,” especially through forced and managed migration. Her evidence includes the history of the lascars, seafarers from South Asian and Middle Eastern colonies who worked for colonial shipping services, usually at lower wages than their European counterparts. Since the late eighteenth century, Britain had relied on lascars as wage labor that could stopgap profits declining after the end of impressment and slavery. Even when white British seafarers began to make important labor gains in the late nineteenth and early twentieth century, these never really trickled down to lascars, who instead found themselves surveilled by new restrictions, such as a 1925 registration requirement for “coloured alien seamen,” and discriminatory wage measures enshrined in British law until 1970.

On land and at sea, forced migration shaped the manning practices for the neo- and postcolonial corporate sovereigns of the Middle East as well. Khalili points out that Aramco’s hiring of a thousand Palestinians displaced by the Nakba was hardly magnanimity; rather, it was an effort to oust well-organized Italian oil workers. Likewise, in the decades after World War II, as the oil industry devoured skilled laborers from Kuwait and Bahrain, shipping companies relied on unskilled workers from the Trucial States, inventing migrant worker categories to control communities that had long crossed back and forth across land now marked by national borders. Khalili threads together many such details as she deciphers a dense web of forced migration patterns and newly restrictive visa systems, from the housing of Pakistani and Lebanese workers in remote labor camps as they build a U.S. naval base in Oman in the 1970s, to underpaid Punjabi dockworkers in the United Arab Emirates today. One of her most haunting stories is about Nepalese logistics workers recruited in 2004 by Jordanian representatives of the Halliburton subsidiary KBR. Told they would be working in Kuwait, they found themselves hauling cargo on the frontlines of the Iraq war, where several were killed in an ambush.   

A parade of strikes and protests attended these histories of labor discipline. But laborers in the Arab Peninsula were far less successful than their colleagues in ports like San Francisco and Durban, where “dockworker power”—the historian Peter Cole’s phrase—has been remarkably light on its feet at the chokepoints of commodity circulation. In one compelling interlude, Khalili resurfaces a little known 1948 docker strike at the Anglo-Iranian Oil Company in Aden, which she regards as a premonition of the anticolonial struggles of the 1960s. (Here, a slightly wider perspective could have brought to light more intricate entanglements of docker strikes and anticolonialism, as in the Australian dockers who struck on behalf of Indonesian independence in 1946, the subject of Joris Ivens’s 1946 short film Indonesia Calling.)

Another legal technology that effectively stymied sea worker resistance was the invention of the aforementioned flags of convenience in Panama in 1916. These jurisdictional games of Three Card Monte rarely redounded to the sailors’ benefit. In 1981, hungry Filipino crew members aboard a Saudi ship docked in Rotterdam struck for sufficient rations. The Dutch courts ruled that a Philippine law prohibited them from legally striking. No wonder  Filipinos currently comprise 14 per cent of all global seafarers.

The vulnerability of contemporary shipworkers was painfully brought home by the recent explosion in Beirut. The cause of the explosion, as we now know, was a bulk shipment of highly explosive ammonium nitrate that Lebanese port officials had removed from an abandoned ship and stored in a generic quayside transshipment depot. That the Lebanese state authorities were manifesting a time-honored capacity for bureaucratic incompetence is clear enough. Less remarked is why they had to remove the explosives from the ship in the first place. It transpires that in 2013, the MV Rhosus, which was flying a Moldovan flag of convenience, had called at the Port of Beirut, where it was subjected to a random Port State Control (PSC) inspection and failed this safety test. Promptly, the ship was let loose by its owner, Russian oligarch Igor Grechushkin, who severed all communications with his crew members. The cargo more or less disappeared as well. Left to their own devices, and deprived of a salary, four Ukrainian crewmembers were held hostage aboard the bomb ship for eleven months, as Lebanese port officials impeded their repatriation, debating how best to dispose of the explosives. The treatment of the workers was scarcely less callous than the eventual handling of the ammonium nitrate.


The final logic of inter-port competition was simply one of humanitarian crisis.

Khalili’s most powerful chapter is her last. Here, she draws on her expertise as a scholar of war to connect the maritime commerce of the Arabian Peninsula to its histories of violence. In the mid-1980s, a stalemate in the Iran–Iraq War led both parties to intensify their attacks on tankers. These “Tanker Wars” expedited the military’s securitization of oil exports, as many ships were reflagged by the U.S. and the Soviet Union eager to protect their corporate interests. “The operations to protect hydrocarbon shipping during the Tanker Wars were one of the earliest arenas for CENTCOM flexing its muscles in the region,” Khalili writes. Iraq’s attack on Kuwait in 1990 offered the U.S. an opportunity to dramatically expand its influence in the region through maritime logistics operations, like the power lift of personnel and materiel during Operations Desert Shield and Desert Storm. Likewise, the remoteness and security of Jabal Ali made it a major transshipment point for the staging of the war in Afghanistan.

Khalili concludes by tracing the profiteering of maritime logistics companies, from Haliburton to the lesser known Kuwait-based Agility, who have offered lucrative aid to these military services. She describes Erik Prince as “the most shameless of these carpetbaggers.” After years of Iraq War profiteering through Blackwater, Prince moved to Abu Dhabi and formed companies including Reflex Responses and Frontier Services Group. These mercenary security and logistics organizations engaged in activities from anti-piracy patrolling in the Gulf of Aden to paramilitary protection for Chinese state investments in the port of Gwadar in Pakistan.

Prince is only one such shapeshifter. Another is the UAE and Saudi coalition that bombarded the ports of Aden and Hodeidah in Yemen, where its blockades exacerbated a cholera epidemic, starvation, and medical supply shortages. Here, even more starkly than in the case of the world’s current rash of stranded sailors, the final logic of inter-port competition was simply one of humanitarian crisis. Wherever they are forgotten or unobserved, the arteries of marine commerce remain prone to such catastrophic embolisms. As people sweep the shattered glass from the streets of Beirut, one can only hope this is a lesson they draw.

Harris Feinsod is associate professor of English and Comparative Literary Studies at Northwestern University, and a fellow at the National Humanities Center. He is the author of The Poetry of the Americas: From Good Neighbors to Countercultures (Oxford 2017) and the co-translator of Oliverio Girondo’s Decals: Complete Early Poems (Open Letter 2018). 

This review was originally published at https://thebaffler.com/latest/all-at-sea-feinsod

Posted in capital accumulation, empire, imperialism & colonialism, environment, finance and insurance, free ports/zones, infrastructure, logistics, Middle East, militaries, oil, shipping conditions, transport, war | Leave a comment

An interview with Katy Fox-Hodess on Logistics, Labour and State Power

20 August 2020

I was honoured to be interviewed by my amazing colleague and comrade, Dr Katy Fox-Hodess (whose own work is also cited in my book and with whom I worked when we put together sinewswartrade.org. Below is the text of the interview for Jain Institute’s Phenomenal World:

Laleh Khalili is a professor of International Politics at Queen Mary University of London and the author of the books Heroes and Martyrs of Palestine: The Politics of National CommemorationTime in the Shadows: Confinement in Counterinsurgency and the co-edited volume Policing and Prisons in the Middle East: Formations of Coercion.

Her latest book, published earlier this year, is Sinews of War and Trade. In it, she connects the themes of war making in the Middle East found in her earlier work with an examination of the contested role of capital, labor and the state in the region—via the maritime logistics industry.

Breathtaking in ambition, Khalili’s analysis draws on a wide range of materials to provide a long-view historical perspective on the economic and political development of the Arabian peninsula through the unequal playing field of global maritime trade. Through thematically-organized chapters on the region, Khalili examines the emergence of maritime routes; the development of landside port, road and rail infrastructure; the role of the law in structuring and securing international investment and ownership; the making of economic and political elites; the working conditions and modes of resistance by both seafarers and landside laborers; and the ways in which all of the above are tangled up with war making.

An interview with Laleh Khalili

Katy Fox-Hodess: Your earlier work focuses on state violence in the Middle East. How did you come to be interested in logistics?

Laleh Khalili: While I was doing the interviews for my book on counterinsurgency, I spoke to several US military officers. One of them was quite sympathetic to my project and very critical of US foreign policy at that time. They said to me, in a joking way, “You academics are interested in the bleeding edge of war, but what you should look at is the money.” It turns out that the money often goes into organizing logistics. Talking with this officer, I learned that payments for fuel for military vehicles, were transferred to Kuwait. The entirety of the Kuwaiti economy had sprouted up through transporting fuel for the US military. I filed this information at the back of my mind.

Some years later, my friend David Hansen-Miller, who worked as a researcher for the International Transport Workers’ Federation, suggested that I research the conditions of dockworkers and sailors in the Arabian Peninsula. There wasn’t much work on the subject, and I knew that many countries in the Arabian peninsula don’t allow unionization. So I began to think about this as well.

And at the same time, I was also ready to be done with writing and thinking about the degree of political violence involved in what I had been working on. It was exhausting and emotionally lacerating. I thought that switching to something that wasn’t so incredibly raw would be more interesting. Of course, there’s a huge amount of violence in logistics, but it’s not the “bleeding edge,” as that military officer put it.

kfh: One of the most wonderful things about the book is the huge array of research methods you used. Can you talk about your mixed methods approach, and about your experiences on the ground doing the research?

lk: My first major project, which was based on my PhD, was a straight-up ethnography. My second book relied on interviews and archival research. As an undergraduate I was trained as an engineer, and before I decided to go to grad school, I was a management consultant. So I’ve built a sense of how things are researched from different angles, and I wanted to be able to reach all of these different areas.

For this book, I did a bit of ethnography onboard container ships, loads of interviews both on land and on sea, and a huge amount of archival work. But a lot of the work on this book actually entailed going through business databases and old trade journals in Arabic and English, which was a new kind of method for me. The different elements of the project required different kinds of thinking and different sets of data; you’re not going to write about the emotional life of a sailor on a container ship by reading business journals, and you’re not going to be able to understand the fantasies of frictionless trade by talking to cynical seafarers who think it’s impossible. You want to access those fantasies, so you read the business journals, and then you situate them within the historical context.

kfh: There’s been a huge proliferation of research and writing on logistics in recent years, but it’s been largely focused on Europe and the United States. What do we learn by looking at the Middle East through the lens of logistics, and what do we learn by looking at logistics through the lens of the Middle East?

lk: Several things attracted me to studying logistics in the Middle East. First, the Arabian Peninsula is not a manufacturing powerhouse like China, Vietnam, or India. The port of Jebel Ali in Dubai is the only port outside of East or Southeast Asia that appears on the Journal of Commerce’s top 10 container ports. In thinking about logistics, we often consider the global supply chain element which begins with the manufacturer and ends up at Walmart. In doing so, we exclude major transit ports like Singapore, Dubai, or Oman. The life and livelihood of those ports is entirely dependent on being middlemen in these routes of trade, and these routes are fundamentally tied to colonial histories. These were trading posts during colonial times, and they were also major and important trading cities before the Europeans came to the Indian Ocean. That was one of the things that I really wanted to examine.

If you study logistics in the Middle East as a lens through which to understand logistics elsewhere, the relationship between surveillance mechanisms and trade and transit becomes very clear. A lot of fantastic critical work on logistics comes from Marxists who focus on manufacturing. (On one of my container ship trips, I took volumes two and three of Capital with me and it was amazing to read his discussion of circulation in that environment.) But in my research I was also occupied by Foucault’s writing on circulation, and how circulation is tied to policing. It’s necessary to think about this because we know that new forms of circulation provide a platform for the creation of new forms of surveillance, and new ways to discipline labor. Your own work shows this. But the surveillance mechanisms are also used to discipline those who live around the ports and shape the conviviality or lack thereof in a port city. Surveillance and securitization are so blatant in the Arabian Peninsula that it becomes a very useful context for thinking about these processes in general.

As for how this research affected my view of the Middle East, I initially wanted to challenge limited stereotypes about the peninsula as either a stage for geopolitics, or a source of oil. Oil is understood as a commodity over which empires fight, but this understanding can exclude both the lives of people who produce oil and the technologies of extraction and transportation that are built around it. People think about Dubai as this awful, blingy place with no soul or culture, but to me Dubai is no different than Singapore or Hong Kong, with exploitation of migrant labor, extreme consumption, and massive inequality. These places are dependent on disciplining noncitizen labor, so the nature of citizenship in these places is also very similar. Yet Singapore and Hong Kong don’t get the same kind of opprobrium that Dubai does. I wanted to show that there is a life, a history, and an entire distinctive politics that underlies the working of these places, which often gets lost when we think at the level of security or bling or oil.

kfh: One of the important interventions of the book within the logistics literature is the centering of imperialism in your historical narrative. Where can we locate the sinews of imperialism outside of regions like the Middle East?

lk: It was impossible not to talk about imperialism or colonialism in the context of the Arabian Peninsula, because many of the infrastructures I studied emerged just before the intensity of postwar decolonization, when oil had been discovered and the empires were on their last legs. The British Empire was fighting tooth and nail to maintain what it could of its foothold in these particular places, at the same time as it was handing over the imperial mantle to the US. The US has always had a colonial presence on its own continent, an imperial and colonial presence in the Pacific and Caribbean, and an imperial presence in the Western hemisphere. But its postwar expansion to a global Empire was central to the story that I wanted to tell. It wasn’t possible to talk about road building or the fight over the continental shelf—who defined it, who designed it, who got to exploit the oil that was there, who got to use it as their exclusive economic zone—without that narrative.

The other thing that became very clear as I was doing this work was that the centers from which capital emanates are proliferating. The US still has the highest number of billionaires, and it still has, in absolute terms, the highest GDP in the world. But the US does not have a substantial maritime industry. It doesn’t have a single company in the top 10 shipping companies. It doesn’t have a single port in the top 10 shipping ports, nor a single port management company in the top 10 port management companies. But it sets the rules by which capital moves, the rules by which trade is conducted, the standards of accounting, the standards of engineering, and the legal infrastructures for the kind of trade that we see in and beyond the Middle East. The kind of free trade agreements that the US engaged in, for example, in the Pacific, has generated this flourishing of jobs for lawyers, accountants, and consultants. They traveled to the Pacific countries that were going to be part of the Pacific free trade agreement in order to standardize according to US criteria. That was fascinating to me, because although capital can now come from Singapore, Abu Dhabi, Dubai or Hong Kong, or indeed Shanghai and Beijing, the parameters and rules within which capital operates are still firmly North Atlantic.

It is also fascinating to see that the securitization of the ports is not usually dictated by the authoritarian regimes that rule those places, although they have their own concerns about wanting to keep the workers away from the population. Much of the securitization actually comes down from the US, which wants mechanisms for checking containers or for making sure ports function in a particular way. The US Department of Defense maintains a list of strategic infrastructures, and it lists global ports as part of its own strategic infrastructure inventory. Because I have worked on the military, I tend to pay attention to the fact that the US spends more on its military than the next nine countries combined. Much of that sum goes into ensuring naval dominance in these places, while also ensuring that that presence is hidden so as not to provoke resistance from the populations there. Perhaps this is what a declining power does, but more importantly, it’s what an imperial power or a liberal empire does.

That’s also what’s changing a little bit under Trump. His administration is trying to dismantle the liberal institutions which have benefited the US. I’m curious as to whether the changes that Trump is bringing about, and perhaps the longer-lasting changes that might come with the pandemic, will affect these liberal institutions that have been nothing but boons to US-centered capitalism.

kfh: My own work has led me to study the rise of Dubai Ports World and some of the other Gulf-based companies in the maritime capital world. You trace how differently DP World has been able to operate in different regions: it’s quite aggressive within the Gulf, and it’s been quite successful. But when it tried to expand into the US post 9/11 it was shut out of the market. Researching dock labor, I’ve learned that the UK and Colombia both have DP World terminals. The one outside London, London Gateway, began with standard union avoidance practices, but it was ultimately unsuccessful. Now it’s a port with a union recognition agreement and terms and conditions broadly similar to other ports in the UK. Meanwhile, in Colombia, the labor conditions are terrible and the trade union movement is in dire straits. Do you have any reflections on how the local and national textures inflect these logistics multinationals?

lk: Dubai Ports World is a really good example of that. They are very aggressive and underhanded in a lot of the Global South, as evidenced by their work in Djibouti and in Yemen. They got their concession to the port of Aden through bribing then-President Ali Abdullah Saleh, and they were subsequently thrown out because they were routing cargo to Jebel Ali. They had taken control of this port, and they were running it down. At every port that I visited in the Western Indian Ocean basin—and I visited a lot of them, also beyond the Arabian Peninsula—everybody who worked in those ports would say, in a quiet whisper and off the record, that if DP World has a terminal, they run it down because they want to route everything to Jebel Ali. It’s a very old-school imperial tactic, actually: you take control of places that you don’t want to compete with, and you run them down.

In other places their behavior is completely different. In London they are still quite aggressive, but it remains litigious, rather than underhanded or violent. In 2006, when they were battered back in the US because of activism against their awful labor practices and Islamophobia, they didn’t take the US to court although they could have won. To me, that said something about their sense of the asymmetries of state power. Based on that sense, they take advantage or they bow down. When I was last doing research in the World Bank’s International State Corporation Dispute database, I found that DP World had several active cases against Belgium, London Gateway, and other places in Europe. At that slightly lower gradation of power, they pursue litigation.

What is interesting is that the other states in which DP World operates have discovered that they need to use brute power to challenge them. Djibouti, which has lost two cases to DP World at the Court of Arbitration, invited China to come take over on of its ports. They were, in essence, daring DP World to challenge China. So these small, weaker states are learning the game of geopolitics in order to challenge corporations that are not in the Global North. But as you suggest, there’s a gradation of power and an awareness that there are asymmetries in the power of the corporation vis-à-vis particular states.

I also want to mention that DP World, and their litigiousness, operates in the context of international arbitration mechanisms which were invented in response to decolonization. As soon as Global South countries became decolonized and wanted control of their own natural resources, transnational tribunals were created to discipline them. I have quotes in the book from former judges gleefully talking about how these arbitration tribunals dethrone the state, at the very moment in which these decolonizing states were emerging. I really wanted to write about that unapologetic continuation of colonial hunger for the natural and economic resources of the Global South.

kfh: I appreciated how much you emphasize the role of the state in understanding logistics. In the Gulf, you highlight how states create a migrant labor force, enabling the development of racial hierarchies in employment, and repress workplace and political protests. Activists and scholars who have developed the idea of “counterlogistics” tend to locate possibilities for resistance in the potential to exercise leverage over so-called choke points. But the substantial role of the state in this sector seems to suggest that effective resistance may not be so straightforward.

lk: There is something very appealing about the idea of counterlogistics because it seems so straightforward: if logistics is the scaffolding along which capitalism operates, then you can pull out one rod of the scaffolding and it should all collapse. But that is not the appropriate metaphor here. Although counterlogistics might work in certain settings and in particular moments, it doesn’t always work. Whether one thinks globalization has positively expanded global trade and connections, or one thinks that neoliberalism has transformed states into adjuncts of capital, we all need to more directly account for the agency of states.

The Middle East is an interesting corrective to this because the state is right there. Its security forces and its laws (or its intentional abrogation of law) are all very visible. The ways in which the power of the state can be harnessed or unleashed are often forgotten, and it is very important to bring the state back in, and to understand the coimbrication of capital and the state in order to understand the possibilities for fissure. All of this matters because the tactics of counterlogistics on their own can be employed for right-wing purposes, as in the 1950s in New York, or in the UK, when London dockers downed tools to support Enoch Powell’s anti-immigrant policies. This had the form of a counterlogistical strike, but its goals were opposed to the kind of international solidarity that counterlogistics often aspires to. One has to think about the deployment of these tactics in particular political contexts, and in what ways workers engaged in counterlogistical protest can put pressure on the state.

kfh: Building on that, what are the possibilities for resistance in logistics in the Middle East? Where, if anywhere, are we likely to see such struggles emerge?

lk: One of the things that we see constantly, in the Arabian Peninsula in particular, is the prevalence of wildcat strikes by migrant workers, which inevitably leads to their deportation, often with months of unpaid back pay. In order to strategically pressure states, we should think about the mechanisms by which these populations can be mobilized, and how the state could be pressured into allowing new forms of mobilization. In the book, I recount how Kuwaiti workers who tried to form unions in the 1960s originally wanted to incorporate migrant workers. Their documents suggested that excluding migrant workers was a system of apartheid. This concerned the British and the Americans, who pressured the Kuwaiti state to exclude migrant workers from the Pacific from union laws. This system has lasted to this day; Kuwait and Bahrain do have unions, but they can only unionize citizens and often only in state-owned industries.

In the last five to ten years, Omani workers have also been able to organize unions. These have been state-approved, and they have often emerged in contexts where there is internal political tension. For example, tensions between the region of Dhofar and its center in Muscat made it possible for unions to emerge in the port in Salalah by showing fealty to the center. That history is interesting to me because in all of the countries of the peninsula where unions exist historically (Bahrain, Kuwait, and Yemen), they emerged precisely because the British, who were in control as protector or as colonizer, wanted unions as conciliatory mechanisms to moderate communist mobilization.

But in all of those places—some for just a period, in the case of Yemen up until today—those unions transformed from conciliatory liaison mechanisms between employers and employees into political forces organizing beyond the bread and butter issues. I would love to see more work on how that happens. To me, this is again related to the role the state plays. It’s about setting up the legal mechanisms necessary for the creation of unions, which can then potentially step beyond those conciliatory roles.

There’s another example that I think is interesting in Kuwait. Workers are not allowed to organize, for example, Filipino migrant workers. But they have reached out, in a transnational way, to migrant worker organizations in the Philippines in order to organize. Again, this is not a workplace thing. It is a political movement which requires transnational connections and transnational fora in which these kinds of alliances can be made. These are interesting developments in the ability of workers to pressure states.

kfh: One of the most beautiful examples of international solidarity in the past few years has been the blockades of arms to Saudi Arabia in solidarity with Yemen. What potential do you see for expanding these sorts of initiatives along supply chains, shipping routes, or across companies like DP World which employ workers in different national contexts with differing terms and conditions?

lk: I think these actions are immensely important, even if they don’t have an impact on the ground: those arms ships may not have been unloaded, but the arms nevertheless ended up where the Saudis wanted them. But even so, these actions are crucial because they demonstrate forms of mobilization that go beyond workplace grievances. I always think that political engagement on the part of unions, whether around issues that pertain to their immediate communities or to global geopolitical cases, is enormously important. However brief and underreported it was, we saw different ports in the US downing tools in solidarity with Black Lives Matter. One day of action doesn’t really affect the long-term work of the ports, but such a thing could be nourished and nurtured to become more organizationally permanent.

If we have global supply chains, then labor action and organization also has to be global. This is especially important at a time when xenophobia—and the political prominence of nativist fractions of the petit bourgeois and working classes—is such a devastating tool of divide and rule in both the Global North and South. If forms of transnational solidarity can be nourished, it would be enormously important in fending off these kinds of right-wing turns, and also in providing the ground on which new transnational organization can emerge. We have to think about these actions as one instance in a very long chain, and possibly as a starting point for something more permanent.

kfh: What have been the impacts of Covid-19 on the logistics industry in the Middle East?

lk: Every time the global trade system experiences something enormous like coronavirus, we expect that everything will change, and sometimes for the better. I tend to be a bit more cynical and think that the capitalist system is elastic: it recuperates, and it often does so in a much more predatory way.

Shipping in the Middle East has interestingly benefited from Covid-19 and the oil price war that took place between Saudi Arabia and Russia in March. They needed to store all of the oil that was being brought out of the earth, and all the land side storage was filled up. So, people started chartering ships. At some stage, tankers were being charged for $300,000 a day, sometimes at several times what the usual price is. Those shipping companies have benefited.

But the effect of the pandemic has been negative in many other ways—and this is global, not just related to the Middle East—because seafarers have been abandoned aboard ships. Many have finished their maximum contract of nine months, but some have been on board ships for fourteen to fifteen months. Sometimes they’re not being paid for being on board the ship. In the Middle East or in the Arabian Peninsula in particular, the situation can get worse because ships can be abandoned without the necessary legal mechanisms to force the owners of the ship to pay workers or to even get the workers off the ships. The immediate effect is that ship owners, particularly if they own tankers, are making money hand over fist, while the seafarers are abandoned in the docks.

Less trade is taking place; many of these ports have seen something like eleven to seventeen percent drop in the volume of goods that are going through them. It’s difficult to tell what this will all mean in the longer term. What is certain is that Covid-19 has consolidated the suffering of the migrant workers. They are much more vulnerable because it’s much more difficult for them to leave, and they’re far more surveilled and policed under the guise of public health. The long-term prospects may seem quite dire. And the only way these changes can be countered is with political mobilization against these forms of depredation.

kfh: Where do you go from here? What’s the next project?

lk: I’m still doing research for bits that didn’t quite fit in the book. One of them is about The Mission to Seafarers and the idea of “missionary work” in the twenty-first-century, which is now in some cases near-secular humanitarian work. Are there any salvific elements in it, and if there are, what are they and how do they work? How does this missionary work function in places where there are no unions, as in the case of these ships where the Mission to Seafarers operate? That’s something that I’m working on now.

I also want to write something a little bit more literary about the experience of melancholy and loneliness for seafarers aboard ships. For example, Marcus Rediker has written beautifully about older, seventeenth and eighteenth century seafaring, but I want to write something about more modern conditions. And then I want to write about tankers—the development of the mechanisms, and their disciplinary character, required to run tankers, bring them to shore, load them offshore, and so on. I want to excavate that history.

This interview was originally published at https://phenomenalworld.org/interviews/laleh-khalili

Posted in bureacuracy, capital accumulation, empire, imperialism & colonialism, environment, finance and insurance, free ports/zones, infrastructure, labour, logistics, Middle East, militaries, seafaring, shipping conditions, transport, war | Leave a comment

Guardian piece about the explosion in Beirut

note: I wouldn’t have used the word “lawless” in the title, as the laws in maritime world are carefully devised to facilitate the accumulation of capital. The sea has always been the site of law — and the law has often been used against those working on the sea and inhabiting its shores:

Behind the Beirut explosion lies the lawless world of international shipping

The disaster has roots in a global network of maritime capital and legal chicanery designed to protect businesses at any cost

Sat 8 Aug 2020 09.59 BSTLast modified on Mon 10 Aug 2020 15.28 BST

Captain Boris Prokoshev and crew members demand their release from the arrested ship MV Rhosus in the port of Beirut, Lebanon, summer 2014
 Captain Boris Prokoshev and crew members demand their release from the arrested ship MV Rhosus in the port of Beirut, Lebanon, summer 2014. Photograph: Boris Musinchak/Reuters

At about 6pm on Tuesday, a seemingly small warehouse fire near Beirut port’s grain silos began to fizz with red sparks. The sparks led to an enormous explosion, a mushroom cloud of water and debris, and a column of orange-red and black smoke rising out of the warehouse.

The shockwave pulverised nearby warehouses and apartment blocks, lifted doors off their hinges and shattered windows several miles away. At the time of writing, 154 people have been reported killed over 5,000 injured and 300,000 have been left homeless. Dozens of people are still missing.

While attention and anger has focused on the incompetence and dysfunction of the Lebanese government and authorities, the roots of the catastrophe run far deeper and wider – to a network of maritime capital and legal chicanery that is designed to protect businesses at any cost.

Whatever sparked the initial fire, the secondary explosion that destroyed the port and so much of the city was caused by 2,750 tonnes of ammonium nitrate stored in a port warehouse. A chemical used in both agriculture and construction, ammonium nitrate is associated with the 1993 Bishopsgate bombing in London and the Oklahoma City bombing in 1995. It was also the cause of huge explosions in Galveston, Texas in 1947 and Tianjin port in China in 2015, both of which killed scores of people. How did such a dangerous incendiary end up in a warehouse so close to residential areas of Beirut?

In September 2013, the cargo vessel the MV Rhosus – owned by a Russian, registered to a company in Bulgaria and flagged to Moldova – set sail from Batumi in Georgia to Mozambique. It carried a cargo of ammonium nitrate purchased by Fábrica de Explosivos de Moçambique, a company that makes commercial explosives. The vessel was operated by eight Ukrainian and two Russian crew members who came onboard not knowing that the previous crew had left the ship in protest at non-payment of their wages.

When the Rhosus was forced by its owner to make an additional stop in Beirut to pick up more cargo, Lebanese officials impounded the ship for breaching International Maritime Organization standards and failing to pay charges including port fees. Ships can be “arrested” if they do not have the necessary paperwork, are considered unsafe or environmentally hazardous, or as a holding security payment on a debt owed, among other reasons.

The ship’s owner Igor Grechushkin had registered his vessel in Moldova, where ship registry is more lax than most in enforcing labour, health and safety and environmental regulations. Open registries like these are considered “flags of convenience”, where a ship flies a flag of a country different to that of its owner.

Flags of convenience were first devised by American lawyers in client states such as Panama, Liberia and Honduras. Even today, much of the profit of some of the largest open registries is expatriated to private companies in the US. The “convenience” in “flags of convenience”, according to the American essayist John McPhee, is “that taxes could be avoided, insurance could be to a considerable extent ignored, and wages attractive to shipowners could be paid to merchant sailors drawn from any part of the world”.

When Grechushkin realised what the impounding of the Rhosus could cost him, he began bankruptcy proceedings and effectively abandoned the ship and its crew. The Mozambican consignees of the ammonium nitrate also forsook the cargo.

Ships are abandoned by their owners with alarming regularity, often to avoid paying the crew wages they are owed. So often, in fact, that the International Labour Organization maintains an abandoned seafarers database. Sometimes an abandoned ship’s cargo is auctioned off to pay creditors, or the crew’s unpaid wages, or clean-up and disposal costs.

In Lebanon, the resale of the cargo did not happen, and the authorities refused to allow four of the seafarers off the ship without a replacement crew. The captain and remaining crew members were left aboard the ship, still carrying its explosive cargo, for almost a year, with no wages, no access to electronic communications and with dwindling food and fuel provisions.

In effect the crew of the Rhosus were hostages in the negotiation between the Lebanese port authorities – who did not want to assume the responsibility for the ship’s dangerous cargo – and the shipowner. In August 2014, a Lebanese judge ordered the seafarers’ release, and the 2,750-tonne cargo of ammonium nitrate was subsequently moved from the vessel to a warehouse in the port of Beirut.

Although most Lebanese are rightfully outraged by the incompetence of the Lebanese authorities, the deadly dealings of international maritime capital are also to blame.

Not all countries of the world are signatories to the international maritime treaties that regulate working conditions and dangerous cargo. Even if they were, many states do not have the resources to pursue claims against unscrupulous shipping companies. Further, international disputes between governments and foreign investors are rarely decided in favour of governments.

Flags of convenience, essentially an offshoring tool intended to protect capital, allow unsafe ships to sail with crews who are vulnerable to the depredations of unscrupulous employers. Even the wealthiest shipping companies in the world, with headquarters in Europe and east Asia, flag their ships to open registries to save on wages, taxes and insurance.

The removal of these offshoring provisions, eliminating flags of convenience, and an overhaul of the arbitration mechanisms that so often disadvantage seafarers and less powerful states are only the first steps towards addressing the malfeasance that created Tuesday’s tragedy. As the dust settles in Beirut, there is a great deal of work to be done.

• Laleh Khalili is professor of international politics at Queen Mary University of London and author of Sinews of War and Trade: Shipping and Capitalism in the Arabian Peninsula

Posted in bureacuracy, capital accumulation, environment, infrastructure, logistics, Middle East, political economy, ports, seafaring, shipping conditions, ships | Leave a comment

Conversation with Rowland Atkinson about global flows of commodities, capital and people

As part of Verso Live events, Rowland Atkinson, the author of Alpha City, and I had a conversation about the global flows of capital, commodities and people:

Posted in capital accumulation, empire, imperialism & colonialism, environment, free ports/zones, infrastructure, logistics, Middle East, oil, political economy | Leave a comment

Logistics after COVID

I wrote the below brief piece for the Foundry, an online publication of the The University of California Humanities Research Institute.

Logistics

by Laleh Khalili


As the COVID-19 pandemic spread across the globe, the traffic in the ports of China reduced to a trickle in January and February 2020. Shortly thereafter the volume of goods arriving at the ports of the Americas and Europe and Africa from China also began to plummet. Ships leaving these continents with raw materials or industrial constituents had to slow-steam to their Asian destinations or wait at anchor off the shores of Chinese harbours, since those ports were not receiving goods either. Freight rates for dry cargos dropped, and charter rates for crude oil tankers skyrocketed. The latter was in response to a massive glut in oil, itself resulting from the drop in demand and a price war between Russia and Saudi Arabia resulting in overproduction; as landside storage tanks were full, and tankers, barges, and any old serviceable floating storage was brought out to store the crude at sea.

Just as maritime journeys and flights slowed down or came to a halt, in much of global North certain elements of logistics intensified. Home deliveries of goods soared. A wave of demand for toilet paper, flour, yeast, and personal electronics used for home-working crested and then subsided. In both the global North and the global South, dependence on poorly waged delivery persons (whether working for logistical behemoths such as Amazon or the mom-and-pop shop down the street) accelerated. States, corporations, medical organisations and individuals throughout the world all frantically conducted global searches for personal protective equipment (PPE), masks, and certain medicines.

In the wake of these upheavals, comparisons and predictions came thick and fast: this was a moment like the Great Depression of the late 1920s, more dramatic than the Great Recession of 2008/2009. Pundits argued that the structure of global trade had changed for good; some even claimed this marked the end of globalisation. The crashing of oil prices led some to prophesy the end of the fossil energy era.

There is an element of wishful longing about these predictions. If capitalism really contains the seeds of its own destruction, then it would make sense that the very same global relations of trade and travel that caused the pandemic to spread so quickly across the surface of the earth will also fall victim to it.

A kind of environmental or pathological determinism sits at the heart of this type of soothsaying. And these types of mechanistic explanations also belie the resilience of capitalism and its cyclical ability to recuperate, often in a much more austere, brutal, rapacious form. Such events as pandemics and subsequent cataclysmic drops in employment and GDP can trigger broader structural changes and result in the creation of new state institutions and regulations. But it is not foretold that these institutions or regulations will be humane, or orientated towards welfare and redistribution.

Perhaps more importantly, the juxtaposition of the pandemic in the first five months of 2020 with the antiracist BlackLivesMatter protests of June reveals the crucial role of constant, relentless and long-standing political organisation, as well as sharp, decisive angry protest and direct action in triggering change. Whether transformations to the symbolic order—statues, stories, commemorative names—or changes, however meagre, to material benefits (for example cuts in police funding), political mobilisation has seen results.

If there are post-pandemic changes to be seen in the logic and operation of global supply chains it will be because of these forms of political mobilisation along the supply chains: from Amazon warehouse workers protesting the shortage of PPE, to essential workers demanding sick pay, to seafarers abandoned at sea threatening to strike in order to be able to go home. Any long-lasting effect will be in response to such activities.

The original blogpost can be found at https://uchri.org/foundry/logistics/

Posted in capital accumulation, infrastructure, labour, logistics, political economy | Leave a comment

E-flux Oceans in Transformation series- Shipping Oil

This essay was originally published by e-Flux as part of their Oceans in Transformation series: https://www.e-flux.com/architecture/oceans/331863/shipping-oil/

Laleh Khalili

Image from ship’s equipment during a journey in the Gulf of Oman. The cluster of triangles towards the bottom left are ships at anchor near the bunkering port of Fujairah in the UAE.

Flying above oceanic anchorages near the world’s largest oil ports reveals a tangle of all sorts of cargo ships waiting to bunker (refuel), as well as load or unload petroleum or chemicals. Oil ports often—though not always—also boast proximity to both vast land-based tank farms for the storage of oil, natural gas, and petrochemicals, as well as to refineries. These oil facilities are usually visible in their totality only from the air or from the sea, with loading buoys sometimes a mile or more away from the shore itself, and the ships anchoring still further. Tank farms tend to be hidden behind layers of barbed wire fencing and security, and strips of wasteland often separate them from the roads that run alongside. These interconnected coastal infrastructures reveal the extent to which the extraction, storage, pricing, and sale of petroleum and petrochemical products is not just dependent on the maritime circulation of petroleum products, but is fundamentally defined by it. Bound up in the politics of circulation are the asymmetries of power: between producing nations and the consumers; between producers of crude and those who refine the oil; between those who work on the ships, tank farms, and infrastructures, and those who profit from them; amongst hegemonic leviathans, rising global powers, and those struggling against imperial economic arrangements.

Because so much transportation (on the roads and in the air) and factory production has ceased as a result of the SARS-CoV-2 pandemic, the demand for oil has dramatically dropped. Simultaneously, a pricing war triggered by Saudi Arabia against Russia has flooded the market with oil. The effect of the pandemic on the circulation of oil and its derivative products has been revealing. First and foremost, the pandemic has shown the brittleness of global trade: the very condition of possibility of commerce across the oceans is also what makes it vulnerable to disruption, with ships and airplanes becoming vectors of transmission. This brittleness and unpredictability extends to the trade in oil, but its effects are paradoxical: despite a general lull in global trade, the chartering of tanker ships has expanded, rather than contracted.

The pandemic has also shown that the upstream production of oil is affected by the downstream processes and financial pricings that are usually conceptualized as subsequent to production. This imagined sequencing—production first, sale and transport thereafter—obscures the foundational role of the circulation of oil in defining the very parameters of its production, but also the long reach of its maritime transportation into the financing and pricing of oil.

Facebook post by Argentinian economic journalist Sergio Elguezábal on April 21, 2020. The map of tankers, shared over 20,000 times to date on Facebook, soon began to circulate across all social media, largely without attribution.

Financial and Physical Markets

In late April 2020, an image circulated on social media that looked like a screen-capture from a ship-tracking application. These types of apps are commercial products that draw on GPS data and ships’ AIS (Automatic Identification System) to track the movement of vessels across the oceans. They also provide information about what kind of ships the small markers on the map represent (container vessels, bulk carriers, roll-on/roll-off vehicle carriers, and the like), what cargo they carry, a history of that ship, and a map of its current route.

The viral social media image was a map focused on the Western Hemisphere, and showed clusters of tankers along the coasts of Africa, the Americas, and Europe. With the concurrent plummeting demand and rise in production of oil, landside tank farms and storage spaces began to run at or near capacity. Oil producers and buyers were chartering tankers to store oil at sea. Instead of circulating, oil was in stasis.

The map, which was first posted on April 21, 2020, documents a historically unprecedented event, in which the “price” of oil dropped below zero. However, the “price” of oil is not a single number, and does not represent the cost of a universal barrel of oil being traded now or in the future, everywhere or anywhere in the world. Several different benchmarks for oil correspond to the location of their trade (West Texas Intermediate, Brent, Dubai, etc.) and they often differ from one another by a few dollars per barrel, based on specific geographical and political determinants. But the place of production and trade is not the only determinant of oil’s price(s).

Oil prices are complex calculations of the price of oil produced at the moment of trade (the spot price) and the price of oil slated for delivery at a future time (futures price). Oil derivatives are financial instruments that were first devised in 1979 and which bet on the future price of a commodity (or even abstract objects, such as an index of prices of freight) going up or down. These financial instruments affect the pricing of oil even in the spot markets, but they do so unevenly, with differing impact, depending on the price of what kind of product the derivative is betting on. The financialization of oil markets was part of a broader global neoliberal trend from the 1970s onwards, but it was also a direct response to the process of nationalization of oil across the Middle East. Up until this moment of nationalization, oil majors (i.e. the seven massive North American and European oil companies: BP, Chevron, Eni, ExxonMobil, Royal Dutch Shell, Total, and ConocoPhillips) had controlled the price of oil. Now, thanks to its financialization, majors are no longer able to dictate the price of oil on a global market, and these derivatives create speculative tools for the extraction of profit from fluctuations in the price of oil.

On April 20, as the landside oil storage in Cushing, Oklahoma—a transportation crossroads between the fields of the Midwest and Texas, and the oil terminals of the Gulf Coast—began to fill, and as some futures contracts reached their settlement date of April 21, the futures price of the West Texas Intermediate crude plunged below zero.1 This meant that on April 20, traders of this particular grade and species of oil were actually paying not to take delivery of oil the next day. Derivatives are sometimes portrayed as wholly speculative abstractions, but as Mazen Labban has written perspicaciously, the pricing of oil is “not a dualism between a ‘real’ space-time of material circulation and a ‘fictitious’ space-time of financial representations. Both are real enough and have their own materiality, but each alone is an abstraction incapable of standing in for the oil market.”2 On April 20, this became undeniable. The materiality of the circulation and storage, its inadequacy and limitations, had crashed the futures market. In the days before and after negative oil prices, many shale oil and offshore companies in the US declared bankruptcy.

Cape or Canal Routes

While the computer screens of the financial systems strobed with the plunging prices of most petroleum products on April 20, maritime tracking screens traced the paths of tankers gathering in ever denser clusters near oil and bunkering ports, waiting to load and unload. Ships were anchored along the coast of Venezuela, the Gulf of Mexico, southern California, Mexico, the west coast of Africa, near the straits of Malacca and Hormuz, and all along the shores of East Asia.

Although we cannot know whether these ships are simply acting as storage or were in fact en route, many shipping companies have changed their routes between Europe and Asia as a direct result of the oil glut.3 When the price of oil—and therefore of fuel—drops, and when ships carrying goods—but especially carrying oil—are in no hurry to get to their destination, it becomes cheaper for ships to take longer routes—for example around the Cape of Good Hope, rather than pay the passage fees for the Suez Canal. The longer routes and the “slow steaming” may add a few weeks to the journey itself, but it saves the shipping companies money. These cost savings are balanced against a delay in promised delivery, the possibility of having to wait at anchor before unloading or loading goods, the length of additional time seafarers may have to spend on the ship, and even possible threats to the safety of the seafarers.

I experienced the effects of something like this when travelling aboard containerships, once in early 2015 during a roaring period of global trade, and once in mid-2016 after a dip in global trade.4 During the first journey, the ship’s captain was ordered by the company to steam at maximum speed through the Red Sea, around the Arabian Peninsula and into the Gulf of Oman. The ship, commanded thus, peeled off from the convoy of ships that pass through the Gulf of Aden together as a precaution against piracy, and hugged the coasts of Yemen and Oman in order to cut a few nautical miles out of the route, at very high speed, consuming huge amounts of fuel. On the second journey, with commerce in a lull, any kind of cargo that could earn some profit was needed, and fuel cost savings were more important. As such, midway through the trip, a new port was added to the route so as to add a few more containers for carriage, with the ship all the while steaming at very slow speeds.

More than 500 shipping journeys were cancelled between Asia and Europe or the Americas throughout March or April 2020. Those that did happen tended to have a reduced of containers and traveled along their routes—which themselves changed, shifting toward the Cape—at extremely slow speeds (sometimes at a quarter of the usual ship speed).5 Even ships steaming from the Eastern Mediterranean have chosen to pass through Gibraltar and go around the southern tip of Africa rather than pay the fees for the much more proximate Suez Canal. The Cape route also allows for economies of scale in the transport of goods. The Canal’s depth and width places certain limits on the size of ships passing through it; SuezMax ships are about 275 meters long and have a draft of 12.2 meters. The ships now loading crude from the Ceyhan oil terminal in Turkey are Very Large Crude Carriers (VLCC) or Ultra Large Crude Carriers (ULCC), some with a draft of more than 20 meters and most with lengths exceeding 350 meters.

Oily pollutants released by an unidentified ship in the Gulf of Oman.

Crude or Refined Oil

Interactive maritime trackers show ships as static (or glacially moving) markers on a screen and often indicate their origins and destinations. The map from April 21, 2020, however, does not show any of that information. Static maps of maritime vessels obscure the contradictory movements and relations and directions of the ships. We can therefore only speculate why the ships were where they were. And even if so many of these ships were acting as storage, it would not be possible to know their destinations or the timing of their journey. But we do know that just as bulk and container ships were cancelling trips, or steaming half empty, the cost of chartering tankers doubled as both producers and traders turned to storing oil on ships. At some stage in mid-April, the cost of chartering a ULCC was up to $350,000 perday, double what it had been a scant few weeks before.

In the April 21 map, some ships are pointed away from Nigeria or Venezuela and seem to be steaming towards the Cape of Good Hope, presumably on their way to Asia. China imports the vast majority of its oil—90% of it—by sea, but China is nowhere near the largest global consumer of oil.6 The US consumed 20% of all the oil produced worldwide, whereas China only takes 13.5%.7 The April 21 map cannot, therefore, be taken as a snapshot of global oil.

The US both exports and imports petroleum.8 Much of what US imports arrives through pipelines from Canada or Mexico and is intended for its refineries which are configured to process particular kinds of oil (heavy/light, sour/sweet) that are produced in specific oil fields. The proliferation of these refineries also distinguishes the US consumption of oil from that of China. US refining capacity outstrips that of all other countries (Texas alone has higher refining capacity than all of China)—but more importantly, its refineries produce products which garner higher market prices. As such, US refineries’ conversion capacity to value-added products far outstrips all other countries. This means that even if the entirety of the Asia Pacific has a comparable general refining capacity to the US, US conversion capacity, and therefore its extraction of value, is higher. Why does this matter for maritime transport?

Those VLCCs and ULCCs that often only carry crude oil depend on an extractive economy and trade in raw materials, a hallmark of colonial economic relations. The chartering of a broader range of ship sizes indicates the extent to which, beyond the economies of extraction, value-added products produced through refining and processing has aided the accumulation of capital in the global North. Indeed, in the aftermath of the nationalization of oil in the Gulf in the 1970s, many of these countries turned to increasing their refining capacity as a means of escaping the extractive economy and acquiring petrochemical manufacturing technology and know-how. The 1970s nationalizers were not fiery revolutionaries seizing control of US or European oil companies as in decades past in places like Iran or Mexico, but technocrats from producing nations of the Gulf negotiating the buyout of their national oil from North American and European oil majors.

These technocrats, however, understood the benefits of downstream value-added production and control over the circulation of their own products. In a fascinating account of a failing shipyard in Belfast in 1975, a sales representative of the ship yard, “back from a sales tour of Saudi Arabia, Kuwait, Abu Dhabi and Iraq,” said that instead of large tankers, the Arabs wanted smaller vessels to carry refined petroleum products such as kerosene and gasoline. “They won’t need them until four or five years from now,” he said, “when they will have the refining capacity to make the products.”9 As Walter Rodney has written, the emphasis on trade of raw materials, rather than on production of more expensive manufactured goods, privileged traders over producers, delayed technological innovation, and led to economic stagnation and intensified exploitation of both humans and natural resources.10

Economic development is a double-edged sword. Both the production and circulation of petrochemicals have dramatic ecological effects. The same shale oil which has, since the deregulation of fracking, boosted the position of US as an exporter of oil, also leads to the devastation of groundwaters, soil, and spaces inhabited by indigenous peoples. The indigenous and first nations people of the Americas have been struggling against devastating extractive industries defacing and destroying their lands for decades. Most recently, however, the Water Protectors of Standing Rock (since 2016) and their Wetʼsuwetʼen counterparts further north (in 2019 and 2020) have campaigned for the cessation of construction of pipelines across their lands. The struggle of the Water Protectors of Standing Rock, however, was crushed by the force of militarized force, while the Wetʼsuwetʼen campaign—which included a widely-supported blockade of logistical lines—has been momentarily deferred because of the pandemic.11

Maritime transportation of oil also can devastate the environment. Tanker transport is responsible for least a quarter of all oil spills at sea.12 And aside from catastrophic large-scale oil spills, ship collisions or groundings can lead to the leakage of oil and petroleum products during loading and unloading. On oil-rich coasts around the world, beaches are often strewn with lumps of tar that have formed at sea and washed ashore. Ships can release ballast water in unregulated ways, and although ballast tanks and oil or fuel tanks are supposed to be separate, dirty ballast water, released in unregulated or lightly regulated ports, can introduce dangerous pollutants into the marine environment. Ships also produce enormous air pollution. If they are at anchor for days, even weeks, on end, the chance of their illicit discharge of all sorts of waste will also increase in such seas, and their engines will inevitably produce oxides of carbon and nitrogen, sulphur compounds, and particulate matters.

The tumbling of global trade, the closure of borders, the historically high unemployment, and therefore plummeting demand for oil wrought by the pandemic all sketch the contours of a shifting context for maritime movement of oil. But the real levers of transformation are political. In response to the pandemic, businesses are consolidating their positions and policymakers are rallying around capital to ensure that any retrenchment does not subvert the processes of accumulation. As trade has been hobbled, various states such as France and South Korea have bailed out their oil and shipping companies.13

As has been true with fracking, pipeline-building, value-extraction through refining, and soaring exports, the US continues to strive for maintaining the hegemonic role of the greatest consumer and one of the greatest producers of oil (and also, inevitably, the greatest polluter). China and India, meanwhile, are slowly taking up the oceans of oil stored at sea as their factories slowly reopen. The midwife of this new post-pandemic age will not be the changes produced temporarily by the pandemic: capital is remarkably resilient in the face of crisis, even successive ones. Any real transformation—in how we produce and circulate and consume energy, in who benefits and who suffers from the effects of production and circulation of petroleum and its products—can come only through concerted political action: one that binds together a stewardship of the earth and its oceans with demands to dismantle global asymmetries of power.

Notes:

1 – The West Texas Intermediate is one particular benchmark, which as Labban has pointed out represents “insignificant shares of the market.” Mazen Labban, “Oil Spill: Inside the Global Market for Crude”, The American Prospect, April 28, 2020, .Go to Text2

2 – Mazen Labban, “Oil in parallax: Scarcity, markets, and the financialization of accumulation,” Geoforum 41 (2010): 541–552.Go to Text3

3 – “Record Number of Box Ships Take Longer Cape Route as Bunker Prices Slide,” Ship and Bunker News,May 6, 2020, .Go to Text4

4 – When researching my book on maritime transportation infrastructures. Laleh Khalili, Sinews of War and Trade (London: Verso, 2020).Go to Text5

5 – Mike Wackett, “Carriers Axe 3 Million TEU Capacity from Key Asia-Europe and Transpacific Routes,” Loadstar, April 16, 2020, ; Brian Wingfield, Jack Wittels, and Firat Kayakiran, “Tankers Round the Cape as Glut Snarls Ports,” Bloomberg, May 7, 2020, .Go to Text6

6 – “Oil and Petroleum Products Explained: Oil Imports and Exports”, U.S. Energy Information Agency, April 27, 2020, ; Yao Wang and Jing Lu, “Optimization of China Crude Oil Transportation Network with Genetic Ant Colony Algorithm,” Information 6 (2015): 467–480.Go to Text7

7 – Eni, World Oil Review 2019 Vol 1. (Rome: Eni SpA, 2019), 18; BP, Statistical Review 2019 (London: BP, 2019), 9, 13.Go to Text8

8 – In 2019 the volume of US imports and exports of oil were almost equivalent (9.1 and 8.5 million barrels of oil per day). “Oil imports and exports”, U.S. Energy Information Agency.Go to Text9

9 – “Huge Belfast Shipyard May Shut” in New York Times, November 8, 1975, .Go to Text10

10 – Walter Rodney, How Europe Underdeveloped Africa (London: Bogle-L’Ouverture Publications, 1972).Go to Text11

11 – See Winona LaDuke and Deborah Cowen, “Beyond Wiindigo Infrastructure,” South Atlantic Quarterly 119, no. 2 (2020): 243–268; Standing with Standing Rock: Voices from the #NoDAPL Movement, eds. Nick Estes and Jaskiran Dhillon (Minneapolis: University of Minnesota Press, 2019).Go to Text12

12 – Roy Facey, “Pollution from sea-based sources,” in Protecting the Gulf’s Marine Ecosystems from Pollution, eds. Abdulaziz H. Abuzinada et al. (Basel: Birkhäuser, 2008), 166–178.Go to Text13

13 – Costas Paris, “Troubled Shipping Lines Turn to State Support,” Wall Street Journal, May 22, 2020. Meanwhile, as a number of independent fracking and offshore companies in the US have declared bankruptcy, the US federal government has reduced oil royalty payments for companies drilling on federal lands, while imposing retroactive fees on producers of wind and solar energy.[footnote Will Englund and Dino Grandoni, “Oil companies drilling on federal land get break on royalties. Solar and wind firms get past-due rent bills,” Washington Post, May 20, 2020.

Oceans in Transformation is a collaboration between TBA21–Academy and e-flux Architecture within the context of the eponymous exhibition at Ocean Space in Venice by Territorial Agency and its manifestation on Ocean Archive.

Laleh Khalili is a Professor of International Politics at Queen Mary University of London. Her most recent book, Sinews of War and Trade, was published by Verso in 2020.

Posted in capital accumulation, empire, imperialism & colonialism, environment, labour, oil, political economy, shipping conditions, transport | Leave a comment

Ports, ships and the human economy of global sea trade: an interview with Laleh Khalili

Little has been written about the sea trade in the Gulf. Laleh Khalili’s latest book explores the complex realities that drive this massive economy.Tugrul Mende30 June 2020

Port of Dubai – Jebel Ali | Picture by Imre Solt. Wikimedia Commons (CC BY-SA 3.0)

During the COVID-19 pandemic many workers in ports and on ships have either lost their jobs or were stuck on ships with or without wages and with an uncertain future.

Ports in the Gulf, like elsewhere in the world, functioned at a minimum. And the Gulf plays an important part in the global sea trade, harboring global trade companies seeking a place that offers little legal rights to seafarers and workers in order to make a maximum of profit.

Will the sea trade, disrupted by the virus, be the same after the pandemic has passed? In her latest book Sinews of War and Trade (London: Verso, 2020), Laleh Kahlil, Professor of International Politics at Queen Mary University of London, takes us on a journey to understand the complex mechanisms that are behind the global sea trade.

We talked over Skype about her research on the sea trade economy and the humans behind it, as well as the impact of COVID-19.

Tugrul Mende: Could you explain why you chose the topic of your book and the difficulties that you faced while working on it?

Laleh Khalili: In some ways moving from the old project to the new one was actually quite a necessary thing because while I was working on my previous book Time in the Shadow: Confinement in Counterinsurgencies (Stanford University Press, 2012), it had become incredibly emotionally difficult to work on that project. My parents both had been political prisoners many years back, and therefore writing about confinement and imprisonment and torture was quite difficult. In a way. I really needed to work on a project that didn’t have the same degree of emotional intensity as the previous book but I still wanted to work on the Middle East and look at the way things worked. Because I have an undergraduate degree in engineering, I am really interested in how things work. I wanted to move away a little bit from detention and political violence etc.

At the same time as this was happening, I was trying to figure out what I wanted to work on. I joked around with friends that I wanted to research bars and beaches in Beirut and in fact I applied for some funding and I managed to get a very small grant and I did produce some research about the politics of beach going, the politics of leisure and pleasure in Beirut. But interestingly bars and beaches didn’t do it for me. I wanted to work on something else and I wanted to be somewhere where I felt like a new student; I wanted to move in an area in which I was not an expert. Learning about a subject is as exciting as writing about it. It allows you to sort of completely shift to new grounds and find new things to work on and new ways of looking at things.

Around the same time I had a friend who was a researcher for The International Transport Workers‘ Federation, which is a global union. He suggested that I should look at the condition of dockers and sailors in the Arabian peninsula, in part, because there is not a great deal of research on this subject and still less researchers working on this subject who know Arabic. There are some really amazing people who work for ITF in the Middle East but they are not necessarily focused on the Arabian Peninsula. A lot of the other countries in the Middle East are more open and have easier access for ITF and, even though they have quite restricted unions they still have unions. Many countries in the Arabian peninsula don’t allow unionization and don’t allow campaigners and activists to access workers. So, I started to look at this project.

The question of worker mobilization tends to be extremely sensitive in the richer countries of the Gulf

Originally, I wanted to situate maritime transport and logistics in the Arab world in a much more historical context. I wanted to understand how these capital-intensive modern ports came about. Around the same time, I got the chance to travel on some container ships, and that was a formative experience. It allowed me to see not only the political and the economic, the infrastructure, and the big macro-political, but it was also the day to day life of the seafarers and the dockers once the ship came into port.

TM: Was it easy to talk with them and approach them as a researcher?

LK: Obviously people are often very apprehensive speaking to journalists or academics in many of the countries of the Gulf because they do worry about surveillance and state repression. In particular, the question of worker mobilization tends to be extremely sensitive in the richer countries of the Gulf. I was very careful about not endangering anybody by trying to approach them from the landslide. The people that I interviewed were mostly mid-level managers and experts. I also interviewed some ministers and deputy ministers. Being on the ship made it easy for me to talk with the workers. As a passenger they were quite happy to talk with me. I also went through the unions’ Facebook groups which is an amazing resource.

TM: According to Statista, Asian economics are experiencing a boom for being home to the world’s leading container ports, and the largest container ship fleets worldwide. In their view, Dubai belongs to this group along with Shanghai, and Singapore. How do you explain this boom especially in the United Arab Emirates?

Laleh Khalili: In the Journal of Commerce lists of the top ten ports of the world, Dubai is the only port that isn’t either in East Asia or Southeast Asia. In the top 10 list you have Shanghai, Hong Kong, Singapore, you have ports in South Korea and elsewhere. There are multiple things at work here. There is an old colonial history which is I think really important to know. A lot of the great ports that today appear on the top ten list used to be colonial city states, and used to be part of the British Empire, as Dubai was for example. There is an entire colonial history of the British having these transit ports which also acted as strategic strongholds. There are other factors as well, I think in the post-colonial era after the Second World War, this happened in a staggered way for different countries.

For Dubai and the countries in the Arabian Peninsula it happened after oil was nationalized. The profits from oil instead of being expatriated to Europe or North America ended up being kept internally and some element of it ended up in infrastructure. In other places, this process happened earlier. This infrastructure investment was important.

Business likes these repressive policies because it allows for maximum profit making

What counts for Dubai is that precise convergence of a lot of different factors including political ones. You end up having a port of transit which operates as a distribution point not just for the UAE but also for the Arabian Peninsula, even beyond, for countries like Iran, Pakistan, or those in East Africa. This role that Dubai has played as a port of transit is comparable to the role that Singapore is also playing.

Neither Singapore nor Dubai have any kind of natural resources. They are both essentially city states. Dubai is part of the UAE but largely it operates as a city state. It has no dominant industry other than trade and tourism. Both cities don’t have a national hinterland except for other countries. I think that port of transit element is part of the reason why Dubai was really successful. They have managed to have the patronage of various imperial powers such as the British in the past and now the US because they have repressive labour policies. Therefore, disruptive and demanding labour forces, whether they are on ships or free zones or on the docks, are repressed politically, and of course business likes these repressive policies because it allows for maximum profit making. This is why Dubai appeares on these lists.

TM: In what way does COVID-19 affect the shipping route of a freighter, if a port is unable to accommodate them because of restrictions made by the government?

LK: What has been interesting about COVID-19 is that it has clearly affected both ports and shipping routes. To start with ports – when the lockdown started in China, it essentially translated into a massive pause in manufacturing which meant that the export of goods out of ports was really radically reduced. There weren’t many ports functioning because of the lockdown. They couldn’t take delivery of all the natural raw material they required. Ports in China, which had been some of the busiest in the world, saw their work drop to essentially nothing. And for a while there were ships lined up near Chinese ports both to load and to unload.

As the pandemic spread around the globe a number of things happened: First, consumption dropped, and that resulted in a massive drop in demand and in manufacturing. The numbers for trade coming out in March show that somewhere between 5 – 13 % of world trade actually dropped. That’s clearly a substantial amount and translated into hundreds of shipping journeys being canceled. Between Europe and China the number I believe approached 500.

A large number of seafarers who have actually finished their contracts three months ago are still onboard the ships and can’t go home

Second, because of the drop in demand and the oil price war between Saudi Arabia and Russia, there was a massive glut of oil. This translated into two things. First, all of the oil coming out of the ground had to be stored somewhere and land based storage filled up very fast. All the oil producers started to store the oil on ships. Tankers, barges, smaller and bigger ships, were all chartered for storage of oil. These ships have been sitting there for months because there was no other place to store the oil. The result was that the cost of chartering or leasing a tanker went up; at some point to charter a large ship could cost up to USD 300,000 a day. The second thing that happened was that the price of oil dropped so low that it became cheaper for ships to go around the Cape of Good Hope in southern Africa rather than pay the fees to go through the Suez Canal. This also changed the shipping routes because it was cheaper to travel three weeks longer than pay the cost of going through the Suez Canal. The effects were really complex.

For cargo ships workers and seafarers the effects were different. Workers on cargo or cruise ships are usually working on contracts that last between four and nine or ten months. After that, they usually spend a month at home, and fly out again to get on another ship. But as this became difficult because ports and many airports are closed to seafarers because of quarantine.

This meant that a large number of seafarers who have actually finished their contracts three months ago are still onboard the ships and can’t go home. Some are being paid while others are not. They are stuck until some government policies are put into place to repatriate these workers. Additionally, some shipping companies are probably going under, which means the seafarers are affected as well.

TM: Do you think the measures taken against COVID-19 which are affecting the economy all over the world, will lead to finding a new way to organize trade?

LK: Here I am venturing into speculation. There is always the question of automation versus labour. Of course, that ignores that nothing is 100 percent automated because there is always some human intervention. And there is also the cost of automation. The fact is that workers are going to desperately look for jobs. This means the cost of labour is going to be pushed down by many of the employers. Whether or not this push and pull will happen is difficult to tell. I have been seeing reports about how many shipping companies have been talking about automated ports because then they don‘t have to worry about any pandemic.

The pandemic reinforces the importance of the workers and the human elements and the fact that the optimistic narratives of capital accumulation were extremely fragile

At the same time, the automated machinery has to be operated by at least one person, and if this person gets COVID-19, then the whole port stops working. The fantasy of a fully automated workplace is still largely that, a fantasy. What might happen are other kinds of changes that have happened during other crisis. One example is the consolidation of shipping companies because it becomes more cost effective. We also begin seeing absorptions of smaller companies. We see larger shipping companies actually scrapping brand new ships because they don’t have any use for them. The cycle of production and scrapping accelerates. Those things will probably happen. In terms of the workers it is a lot harder to see because of the question of automation being so central to all of this.

TM: If COVID-19 had appeared before publishing this book, how do you think it would have affected your research project?

LK:I wouldn’t be able to finish the project without being able to travel and research or without being able to go to the archives, because not all archives are digitized. Let’s say that if I had researched the project and now I would write it, would I include anything different?

In the parts that I cut I had a really long section on quarantine. I cut it because I just thought that it is too long. I have all of this material and I have been thinking to incorporate the idea of shipping quarantine into some other writing. If I had done my research and I was just writing the book in the time of the pandemic, I wouldn’;t have changed anything. I might have made references to it but it wouldn’t have changed the content fundamentally. If anything, the pandemic reinforces the importance of the workers and the human elements and the fact that the optimistic narratives of capital accumulation were extremely fragile.

This post was originally published on the OpenDemocracy site at https://www.opendemocracy.net/en/north-africa-west-asia/ports-ships-and-human-economy-global-sea-trade-interview-laleh-khalili/

Posted in capital accumulation, empire, empire, imperialism & colonialism, free ports/zones, imperialism & colonialism, infrastructure, labour, logistics, media, Middle East, political economy, ports, seafaring, shipping conditions, transport | Leave a comment