King of Oil

Within only a few years the dynamics of power within the oil industry had been completely turned on their head - forever. Today, in 2009, the corporation that made up the Seven Sister no longer control the global oil trade. There are now ten state oil companies that control three-fourths of global oil reserves. The most important oil-producting companies are politicaly fragile states: Saudi Arabia (Saudi Armaco), Russia (Gazprom), and Iran (NIOC).

One aspect of Marc Rich's career that was forgotten during the entire affair was his unique entrepreneurial success. For starters, he is more than just a profiteer and boycott breaker. It was not Rich's alleged tax evasion that made him the twentieth century's most dominant trader. When I asked how he had managed to achieve so much, he answered with the standard trader's joke, "Buy low, sell high." Then he added in more serious tone, "The ingredients are hard work, hard work, and hard work - and good collaborators. Obviously a little bit of luck help also." These are surely important elements of success, but they cannot provide a good explanation for the sheer scale of his remarkable achievements.

"When in Rome, do as the Romans do", an oil trader once said in response to one of my questions. He had spent a lot of time in Nigeria, one of the most corrupt countries in the world, which just happens to possess immense oil reserves. I wanted to know what he ment. "If you want to get pregnant, you can't stay virgin," he said. Of course, he admitted, he had paid bribes in order to receive contracts. "[Marc Rich's] trading empire was based largely on systematic bribes and kickbacks to corrupt local officials," alleged the House Committee on Government Reform, which carried out an investigation into the circumstances surrounding Rich's pardon. The oil trader in Nigeria does not accept this charge. "We would be neither as successful nor would we still be in business if we had only paid bribes. More importantly, we offered our customers a better service than our competitors." Rich himself does not deny having authorized bribes.

Rich's is one of the most amizing careers of the twentieth century, a career that is tightly woven with great events in world history: Fidel Castro's revolution in 1959; the decolonization of Africa in the 1960s; the Yom Kippur War and the oil shock of 1974; the fall of the shah of Persia and the seizure of power by the Ayatollah Khomeini in Iran in 1979; apartheid South Africa in the 1980s; and the crumbling of the Soviet Union in the 1990s. Marc Rich and his business partners were on the scene when these events happened. Thanks to their know-how, their hard work, and their considerable aggression, they were able to react to these events to their benefit more than their competitors ever could.