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“Done, Uncle Billy,” Castillo said.
“Very well. Now, understand that Iraq was a virtually unlimited pool of crude oil. Outside of Iraq, that oil was worth at least fifty U.S. dollars a barrel—say, a dollar a gallon. The problem Saddam had was, the UN had forbidden him to export this oil so it was worthless to him.
“I should mention that under his benevolent administration of Iraq, the oil all belonged to the government, which is to say him. He had absolute control of it and nobody could ask him any questions.
“The way he got around his problem was to have the UN authorize him to sell some of his oil, the proceeds from which could be used only to purchase food and medicine for the Iraqi people.
“Aside from saying that resulted in a good many aspirin pills being sold to Iraq at five dollars per pill—and similar outrages—do you want me to get into that?”
“Stick with the crude oil, please, for now,” Castillo said.
“Very well. I presumed you knew at least a little about the price scams and payoffs,” Kocian said. “About the crude oil. Do you know how much crude oil a tanker carries?”
“No,” Castillo confessed.
“I seem to recall that when the Exxon Valdez went down, she dumped 1.48 million barrels of crude oil into your pristine Alaskan waters,” Kocian said. “But to keep it simple for the dummies to whom you refer, let’s say just one million barrels. Doesn’t that space-age laptop of yours have a calculator? Can it handle multiplying fifty dollars a barrel times a million?”
Castillo could do that simple arithmetic in his head but he had his laptop open in front of him so he punched the keys anyway and reported: “Fifty million dollars, give or take.”
“Very good! Now we go back to Mahashar. The UN has authorized Saddam to sell, say, twenty-five million dollars’ worth of his oil to buy food and medicine for his people. It has also dispatched UN inspectors to Mahashar to make sure that’s all that leaves the country.
“A tanker then arrives in Mahashar to take on the oil, which has already been sold to some fine fellow at a good price—the fellow being expected to make a small gift to Saddam, but that’s yet another story.
“Twenty-five million dollars’ worth of oil is about half a million barrels and that’s about half of the capacity of the tanker which shows up in Mahashar to haul it away under the watchful eyes of the UN. So the tanker pumps out half of the seawater ballast it has arrived with, replaces that with crude oil, and sails away half
loaded with crude and half with seawater.
“Now, no one has ever accused Saddam of being a rocket scientist, but it didn’t take him long to figure out that if he could only devise some way to have future tankers pump out all of their ballast and sail away with the tanks full of crude there would be money in it for him.
“He thinks: Eureka! All I have to do is slip the UN inspectors a little gift, they look away, and off goes the tanker with an extra twenty-five million dollars’ worth of crude.
“This poses some administrative problems. He can’t just hand the UN inspector, say, fifty thousand dollars for looking the other way. That’s a lot of money, even in one-hundred-dollar bills, and there’s a chance, however slight, that an honest UN inspector exists and might blow the whistle on a dishonest one.
“Further, what happens to the half million barrels of oil that nobody knows about, once it’s sailing down the Persian Gulf toward the oil-hungry world? Until it’s sold, it’s worthless.
“So they find some other government controlled by gangsters and thieves—the Russians come immediately to mind, but others were involved—who are oil producers and can legally export oil within the restrictions imposed by that other fine international body, OPEC.
“If they buy the half million barrels of oil—since it’s otherwise worthless to him, Saddam can sell it for, say, ten dollars a barrel under the table—they can turn right around and sell it as their own. And not have to deplete their natural resources.”
Castillo looked at Doherty, who had just about filled half of one blackboard with cryptic symbols.
“But who to sell it to? ExxonMobil and its peers, believe it or not, are fairly honest. They won’t touch it unless they know it’s clean. Your Congress would love nothing better than to send them all to jail. So what they had to do was find small oil refiners—there are thousands of them—and offer them a real deal—say, thirty dollars a barrel.
“But—you said a small refiner in Houston?”
“I said a small broker in Midland,” Castillo said. “The one we have in mind does have a small refinery in Houston.”
They heard Kocian grunt knowingly before he went on: “A small broker in Midland with a small refinery in Houston would be aware that your Internal Revenue Service would be looking at his books and might smell the Limburger when they saw he had been buying thirty-dollar-a-barrel oil.
“So what does he do? He writes a check—actually, has his bank wire—the full, fair price of the oil to, say, the Cayman Islands Oil Brokers Ltd. Now he either owns this business or has a very cozy relationship with it. They acknowledge receipt of the money, take a cut, and put the difference between what he actually paid for the oil and what he’s telling IRS he paid for it into another numbered account. Getting the picture, Karl?”
“Yeah,” Castillo said, although he was still trying to absorb it all.
“And here’s where your friends Lorimer and Pevsner enter the picture,” Kocian said. “The UN inspector has to be paid for closing his eyes, the captain of the tanker has to be paid for taking on more crude in Mahashar than he reports to ship’s owner—and who is better able to do this than Dr. Jean-Paul Lorimer, a diplomat of the United Nations who’s always flitting around the world doing good?”
“Where did Lorimer actually get the cash—I presume we’re talking cash—to make the payoffs?” Castillo asked.
“Offshore banks simply will not take cash deposits,” Kocian said. “They virtuously want to know where the money comes from.”
