The Predictions of the British Economists of Possible Impacts of the Iraq War on UK's Economy Essay

According to the report of US Energy in Formation agency, Iraq possessed the second largest oil reserve in the world. Between 2000 and 2001 Iraq could produce 2,5 million barrels per day and in recent years, oil production was rising until it reached 3 million Barrels a day. (William. D, 2002)
The foreign secretary Jack Straw claimed that Iraq and its neighbors were very important for the world because of their oil. Besides oil, Iraq was a very rich country with gas. It had the 13th largest gas reserve in the world. It owned 1,5% of the world total gas and most of the Iraqi gas was in the south area with a very high quality unlike the one found in the north. Although Iraq gas was so large, it depended on oil in its economy more likely. (International energy agency, 2012, p. 68)
3.3 The Predictions of the British Economists of Possible Impacts of the Iraq War on UK's Economy
Iraq invasion was expected to develop the British economy through controlling the Iraqi natural sources however, many economists saw the contrary. Before the British intervention in Iraq War, there were a lot of prediction and warnings among the economists about the future impact of the war on the British economy. Wars could be expensive and destructive they could turn the economic position of a country from bad to worse. On the other hand, they could so be beneficial for the victorious countries. Britain had experienced the impacts of wars several times before the Iraq war, as it was mentioned in chapter one both WW1 and WW2 destroyed the British economy, and the First Gulf War led to a rise in oil prices. Despite the fact that wars had affected the British economy, Britain continued its interventions.
Many economists saw that the Iraq war would bring economic damage to the British economy. They worried of oil crisis which could lead to economic collapse for Britain and the coalition as well. According to Dr. Vincent Cable economist for Shell and International Economics program director, he wrote an article in the Guardian, entitled "The Economic Consequences of the War". Cable gave his predictions of the possible impacts of the Iraq war on the economy of Britain. He set three possible impacts of any war in general and the Iraq war in particular. First, the timing no one could know when the war could stop, therefore, the impacts of the war could continue as long as the war was continuing. Second, he believed that nations even were victorious the economy would be affected by the costs caused the war (as it happened during the First and second world wars). In any case, the costs could be reduced if someone else paid for the war, like during the First Gulf war when Arab countries paid for the war. The third possible impact could be the rise of prices which could affect the importing countries like the UK and the USA in the first position. (Cable, 2002)