Michael Hudson with Democracy Now: US control of oil

Prof. Hudson’s initial interview was broken into two pieces because of time pressure.

The Democracy Now Videos seems to be difficult to embed, so, both videos are linked to Democracy Now, and both transcripts are contained here. Michael Hudson considers the second segment, including a part on the Board of Peace as important.

https://www.democracynow.org/2026/3/3/michael_hudson_economist_trump_iran_attack

We speak with economist Michael Hudson, who details how President Trump opted to attack Iran despite progress at indirect U.S.-Iran negotiations. “The whole reason that America has attacked Iran has nothing to do with its getting an atom bomb,” but instead the aim was U.S. control of oil, says Hudson. The Trump administration may have been after the ability to “turn off the power” to countries that don’t follow U.S. foreign policy, he says.

Transcript

This is a rush transcript. Copy may not be in its final form.

AMY GOODMAN: This is Democracy Now!, democracynow.org. I’m Amy Goodman, with Juan González.

“The US/Israeli Attack Was to Prevent Peace Not Advance It.” That’s the headline of a new article in CounterPunch by the economist Michael Hudson, who details how President Trump opted to attack Iran despite progress made during last week’s U.S.-Iran negotiations in Geneva. In the piece, Hudson writes about the significance of these comments by Oman’s Foreign Minister Badr Albusaidi, who appeared on CBS’s Face the Nation Friday, one day before the U.S. attack.

BADR ALBUSAIDI: If the ultimate objective is to ensure forever that Iran cannot have a nuclear bomb, I think we have cracked that problem through these negotiations by agreeing a very important breakthrough that has never been achieved anytime before.

AMY GOODMAN: We’re joined now by the economist Michael Hudson, president of the Institute for the Study of Long-Term Economic Trends, distinguished research professor of economics at University of Missouri-Kansas City.

Thanks so much for being with us, Michael. I mean, it seems that the Oman foreign minister flew to Washington so he could directly address this issue, saying more progress had been made and that the deal was going to be one better than Obama’s. He didn’t trust President Trump’s envoys, Jared Kushner and as well as — he didn’t trust Kushner to convey the level of progress that had been made, so he spoke directly himself to the American people through the U.S. press. Your response?

MICHAEL HUDSON: The fact that progress was being made, and that Iran negotiators had agreed not to only — not to have an atom bomb, but to reduce their refined uranium, to shift the refined uranium outside of the country, and to submit to an unprecedented degree of oversight, made it urgent that the United States attack Iran immediately, because what happened was that after the Iranian negotiators went back to Iran, Khamenei and his religious leaders and the military leaders sat down to have a meeting to draft their reply accepting the U.S. demands.

But none of this was about an atom bomb to begin with. The whole reason that America has attacked Iran has nothing to do with its getting an atom bomb, because it wasn’t getting an atom bomb. The aim was to control Near Eastern oil by the United States. And General Petraeus, years ago, had outlined this whole plan in saying, “Well, we’re going to conquer seven Near Eastern countries, culminating in Iran.” Well, actually, the plans go way back to 1974, when OPEC quadrupled the prices, and the United States said, “Well, you can quadruple the prices, but we need to control the world’s oil trade, because oil is a chokepoint. Every country needs oil for its industry, for its transportation, for its electricity, to heat the home. And if we can control the world’s oil trade, then we can use that as an arm of U.S. diplomacy. And we don’t have to own the oil. We don’t have to overthrow the OPEC countries like we did the Iranian government in 1953 when they wanted to nationalize oil. You OPEC countries can nationalize your oil. You can take control of Aramco and the other countries. But you have to make an agreement that all of your profits and rents from the oil will be lent back to the United States, recycled in the United States, priced in dollars and invested in U.S. Treasury securities, U.S. bonds and U.S. stocks, so that the money, the vast dollar inflows from your oil exports, will all be part of the U.S. economy.”

I sat in on meetings in the White House in 1974 when this was discussed, because I had been the specialist at Chase Manhattan for the U.S. balance of payments and specifically for the oil industry. And from the very beginning, the U.S. foreign policy was based on if we can control the world’s oil trade, then we really have control of the world’s economy. But in order to do this, we have to prevent other countries from buying oil from countries not controlled by the United States — first by Iran after the shah was overthrown; then you can’t let them buy from Russia after 2022, so you had the sanctions against Russia and the destruction of the oil pipeline; then the sanctions against Venezuela to prevent countries from buying from Venezuela; and now back to Iran to prevent Iran from selling its oil to China. Eighty percent of Iran’s oil exports had gone to China.

So, the whole idea from the beginning was to consolidate the U.S. ability to control oil, and thereby to give Trump and the U.S. administration the ability to turn off the lights, to turn off the power, to turn off the electricity to other countries if they did not agree to follow U.S. foreign policy, to maintain sanctions against other oil countries, against Russia, China also and Iran, and follow the —

AMY GOODMAN: Michael Hudson, we’re going to continue this conversation and post it online at democracynow.org. Michael Hudson, economist, we’ll link to your article, “The US/Israeli Attack Was to Prevent Peace Not Advance It.” Michael Hudson, president of the Institute for the Study of Long-Term Economic Trends.

Democracy Now March 3 2026 IRAN war

https://www.democracynow.org/2026/3/3/michael_hudson_economist_trump_iran_attack

We speak with economist Michael Hudson, who details how President Trump opted to attack Iran despite progress at indirect U.S.-Iran negotiations. “The whole reason that America has attacked Iran has nothing to do with its getting an atom bomb,” but instead the aim was U.S. control of oil, says Hudson. The Trump administration may have been after the ability to “turn off the power” to countries that don’t follow U.S. foreign policy, he says.

Transcript

This is a rush transcript. Copy may not be in its final form.

AMY GOODMAN: This is Democracy Now!, democracynow.org. I’m Amy Goodman, with Juan González.

“The US/Israeli Attack Was to Prevent Peace Not Advance It.” That’s the headline of a new article in CounterPunch by the economist Michael Hudson, who details how President Trump opted to attack Iran despite progress made during last week’s U.S.-Iran negotiations in Geneva. In the piece, Hudson writes about the significance of these comments by Oman’s Foreign Minister Badr Albusaidi, who appeared on CBS’s Face the Nation Friday, one day before the U.S. attack.

BADR ALBUSAIDI: If the ultimate objective is to ensure forever that Iran cannot have a nuclear bomb, I think we have cracked that problem through these negotiations by agreeing a very important breakthrough that has never been achieved anytime before.

AMY GOODMAN: We’re joined now by the economist Michael Hudson, president of the Institute for the Study of Long-Term Economic Trends, distinguished research professor of economics at University of Missouri-Kansas City. Thanks so much for being with us, Michael. I mean, it seems that the Oman foreign minister flew to Washington so he could directly address this issue, saying more progress had been made and that the deal was going to be one better than Obama’s. He didn’t trust President Trump’s envoys, Jared Kushner and as well as — he didn’t trust Kushner to convey the level of progress that had been made, so he spoke directly himself to the American people through the U.S. press. Your response?

MICHAEL HUDSON: The fact that progress was being made, and that Iran negotiators had agreed not to only — not to have an atom bomb, but to reduce their refined uranium, to shift the refined uranium outside of the country, and to submit to an unprecedented degree of oversight, made it urgent that the United States attack Iran immediately, because what happened was that after the Iranian negotiators went back to Iran, Khamenei and his religious leaders and the military leaders sat down to have a meeting to draft their reply accepting the U.S. demands.

But none of this was about an atom bomb to begin with. The whole reason that America has attacked Iran has nothing to do with its getting an atom bomb, because it wasn’t getting an atom bomb. The aim was to control Near Eastern oil by the United States. And General Wesley Clark, after the 9/11 attacks, had outlined this whole plan in saying something to the effect that the United States was going to conquer seven Near Eastern countries in the next five years, culminating in Iran.

The plans actually go way back to 1974, when OPEC quadrupled the prices, and the United States said, “Well, you can quadruple the prices, but we need to control the world’s oil trade, because oil is a chokepoint. Every country needs oil for its industry, for its transportation, for its electricity, to heat the home. And if we can control the world’s oil trade, then we can use that as an arm of U.S. diplomacy. And we don’t have to own the oil. We don’t have to overthrow the OPEC countries like we did the Iranian government in 1953 when they wanted to nationalize oil. You OPECcountries can nationalize your oil. You can take control of Aramco and the other countries. But you have to make an agreement that all of your profits and rents from the oil will be lent back to the United States, recycled in the United States, priced in dollars and invested in U.S. Treasury securities, U.S. bonds and U.S. stocks, so that the money, the vast dollar inflows from your oil exports, will all be part of the U.S. economy.”

I sat in on meetings in the White House in 1974 when this was discussed, because I had been the specialist at Chase Manhattan for the U.S. balance of payments and specifically for the oil industry. And from the very beginning, the U.S. foreign policy was based on if we can control the world’s oil trade, then we really have control of the world’s economy. But in order to do this, we have to prevent other countries from buying oil from countries not controlled by the United States — first by Iran after the shah was overthrown; then you can’t let them buy from Russia after 2022, so you had the sanctions against Russia and the destruction of the oil pipeline; then the sanctions against Venezuela to prevent countries from buying from Venezuela; and now back to Iran to prevent Iran from selling its oil to China. Eighty percent of Iran’s oil exports had gone to China.

So, the whole idea from the beginning was to consolidate the U.S. ability to control oil, and thereby to give Trump and the U.S. administration the ability to turn off the lights, to turn off the power, to turn off the electricity to other countries if they did not agree to follow U.S. foreign policy, to maintain sanctions against other oil countries, against Russia, China also and Iran.

JUAN GONZALEZ

You mentioned that this United States attack on Iran is really about controlling world oil supplies more than the internal dynamics or the threat of Iran against the US. And you mentioned the Arab oil boycott of the 1970s, but there’s been a major shift obviously since that period of time. Back then, the United States was highly dependent on the Middle East for its oil. Today this country is essentially self-sufficient in terms of its production of oil. So there is really no direct need for Middle Eastern oil for the US economy, but as you mentioned, controlling the supply of the Middle East is a way really of controlling other countries. Obviously India, China depend largely on Middle East oil for their oil supply, and of course natural gas — some from Qatar flows to those countries as well as to Europe. Could you elaborate a little more about how you believe this is actually a way to put the stranglehold on other countries in the world?

MICHAEL HUDSON

Well, you can see the result of what happened when the United States blocked Europe from buying Russian oil and gas after Russia’s special military operation in February 2022. The German chemical industry was greatly downsized. The glass industry that runs on gas heating ended. Germany moved into a recession and essentially remains in recession. And with the war in Iran yesterday, the German price of oil jumped over 20%. And this is breaking the European budgets, basically, because unless the government gives special subsidies to consumers to heat their homes and light their homes, something has to give. The government has a choice: either cut back its social spending in order to support the military budget that’s supported by Starmer in England, Macron in France, and Merz in Germany — or move into recession.

So getting back to you mentioning the US being self-sufficient in oil — this is very important. Because while oil prices are going up for the rest of the world and they’re in an economic squeeze, the United States isn’t. The rise in world oil prices is a windfall for United States domestic oil companies and gas companies. They’re making a killing. So the United States balance of payments is in very good terms.

But this is creating a crisis that I think is unanticipated by the US government. As oil prices go up, especially for Global South countries, which you didn’t mention — how are the countries of Africa and South America going to be able to pay for the increase in oil prices and pay the foreign debts that are falling due? They’re already in a squeeze of the debts falling due to US dollar bond holders, stockholders, banks, and the International Monetary Fund. Something has to give.

So these countries are now facing a choice. Who’s going to come first? Are they going to pay the bond holders at the cost of imposing domestic austerity, ending up looking like Germany looks today? Or are they going to say, because of the US attack on Iran that’s caused the oil price increase, ‘We can’t afford to pay the dollar debt. So we’re banding together and calling for a moratorium on debt payments.’ This is going to completely disrupt financial markets if the blockage of the Hormuz Straits continues for more than a few months.

You may be surprised at how little the price of oil has gone up already. Well, it’s gone up 10%. That’s a lot, but it’s not really shocking. The United States and other countries are going to be releasing their oil reserves in order to keep down international prices, at least until the elections, and especially to keep down prices in the United States — in order for Trump to say, ‘Well, I’m not creating inflation and squeezing the budgets of homeowners and voters because we’re making sure that we’re stabilizing things. The war will be over very quickly.’

And Trump continues to say it’s going to be over in four weeks, five — when he is scheduled, by no coincidence, to go to China. And I received notes from China today saying that this is very important. It’s so important that China — they were going to publish a third edition of my book Super Imperialism, which was basically the guide for understanding the Defense Department’s strategy regarding OPEC way back in 1974. China wants to sort of keep everything very quiet so it can essentially give the ultimatum to Trump, saying: if you try to block oil trade to us, if you block us Chinese from buying Russian tankers, if you continue to seize Russian tankers, if you continue to block Venezuela’s oil to us and Iran’s oil to us, then we’re going to stop all the exports of essential materials to you. And if you continue to support Taiwanese independence and sell them arms, we’re also going to stop that.

All of this showdown is going to be coming in one month. And so that puts a time constraint on what Trump has to plan militarily in Iran. Iran says this is not going to be over in one month. This is for us an existential fight. We are not going to stop attacking Israel and American military bases and other American military bases until these bases are removed from the Middle East and the United States leaves us alone. So this is what it’s really all about. It was always about oil.

But you’re not going to have Trump come out to the public and say, ‘Well, we’re bombing Iran in order to cause a regime change, to impose a regime very much like we did with Boris Yeltsin in Russia — a regime loyal to the United States, not to Iran, a regime that will not insist on Iranian sovereignty but will follow US policy, just like so far we’ve been able to do so successfully in Venezuela.’ So it’s all about oil.

AMY GOODMAN

Michael, I just wanted to ask you — because I highly recommend your article to our viewers and listeners — but you also raised the spectre that this is actually potentially the beginning of World War III. Could you talk about that as well?

MICHAEL HUDSON

Well, it’s World War III because it involves all other countries. The fight in Syria, the fight in Gaza has been considered fairly localized, but because the oil trade affects every country, it’s worldwide in its implications. And what is happening is that other countries are confronted by an economically aggressive United States.

Basically, the United States explained last December in its national security study that American security depends on the ability to deny other countries their sovereignty. We feel insecure if other countries have the sovereignty to act as they wish, which may be against US interests. And now that the United States is no longer an industrial power, now that we’ve de-industrialized and moved our industry to Asia, we’ve offshored it, now that we no longer have the financial power that we had before — the whole world order that we created in 1945 under the United Nations, the IMF, and the World Bank no longer serves American interests. Now we have only one way of influencing other countries, and that’s our ability to create chaos in other countries if they do not give special givebacks to the United States by joining our attack or isolation of Russia, China, Iran, Venezuela, and any other country that does not follow US policy.

So the effect of all of this is — instead of isolating these designated enemies of the United States — Trump’s policy is isolating the United States itself. It’s forcing other countries to say: the basic principle of international law ever since 1648, all the way to the United Nations Charter in 1945, was that every country has national sovereignty. It’s against international law to interfere with other countries’ internal politics and their overall diplomacy. And it’s against the international laws of war to make an unprovoked attack on other countries. It’s against the international laws of war to focus on civilians.

But the US military policy, as we’ve seen in Iran and as we’ve seen in Gaza and we’ve seen in Syria and as we’ve seen in Ukraine, is to focus the military attack on civilians, not military bases — because the Americans think that if you hurt another country enough, they will be so upset they will overthrow the existing regime. Regime change. They’ll say, ‘We don’t want to have our schools bombed anymore. We’re willing to overthrow the government and put a pro-US government there so that then the United States won’t bomb us anymore.’

Well, that’s a crazy idea. It didn’t work for England when it was bombing German cities — that just reinforced the German opposition. And when Germany bombed London, it didn’t make London say, ‘Well, we’re going to just surrender to prevent the V-2s from landing here.’ It galvanized British opposition. Same thing in Iran: instead of the attack on Iran leading to a regime change, especially now that Iran turned off the internet and the Starlink that the US had been coordinating — a kind of Iranian Maidan political demonstration — the Iranian people overwhelmingly supported the existing government. And that’s what any society under attack would do. When you’re under attack, you support the government, even if you don’t like many of the government’s policies, because you don’t want to lose national sovereignty.

So this is World War III because the choice is: what kind of a world are we going to have? Will it be the kind of world that was designed in 1945, that is multipolar? Every country is a sovereign country. The United States claimed not to have any special power, but it was for free trade then — when no other country was able to compete with American industry, and no other country had the financial resources to be stronger than the United States, and they all needed US financial support, US military support, and US economic support. That world is all over now.

So the question is whether the world is going to say, ‘We’re going to accept President Trump’s suggestion that his board of peace under US control and his personal control is going to determine world economic policy,’ or ‘We’re going to insist that we, the global majority, create the kind of world that civilization has been moving towards for the last four centuries.’ Are we going to surrender to the United States, or are we going to say, ‘I think it’s time to decouple from the United States and de-dollarize’?

Well, one of the reasons that America found it so urgent to bomb Iran was that Iran was not pricing its oil in dollars. Because it was selling to China, it was dealing with Chinese currency. Same thing with Venezuela — Venezuela had announced that it was going to stop pricing its oil in dollars, that it was going to price in foreign currencies and specifically the Chinese currency. Same thing with Russia. Since the Europeans confiscated the $300 billion of Russian savings in Belgium, Russia said, ‘Obviously we can’t have any of our international transactions in dollars anymore. We’re having them in other currencies than dollars.’

So the United States was faced with a substantial portion of the world’s oil export trade not being in dollars anymore. And this means that all of the profits from the oil trade were going to move — instead of being recycled to the United States, largely to fund America’s military spending abroad in the 800 military bases that it has — the United States will not have the balance of payments inflows from oil to enable it to finance its international military diplomacy and political diplomacy and all of the effects that it has. The private sector is much more in balance than the military spending. My book Super Imperialism explained how military spending was entirely responsible for the whole US balance of payments deficit, the drain of gold from the 1950s to the 1960s into the 1970s, and it’s still a major drain on the US balance of payments.

AMY GOODMAN

Michael, so much is at stake. We want to thank you for being with us. Economist Michael Hudson — we will link to your new article, ‘The US-Israeli Attack Was to Prevent Peace, Not to Advance It.’ Michael Hudson is president of the Institute for the Study of Long-Term Economic Trends, distinguished research professor of economics at the University of Missouri, Kansas City. To see part one of our discussion, go to democracynow.org. I’m Amy Goodman with Juan Gonzalez. Thanks so much for joining us.