Steve Coll's big book on America's biggest oil company starts with the Exxon Valdez's giant oil spill in 1989 and ends in 2011 with a ruptured Exxon pipeline that dumped a thousand gallons of oil into the Yellowstone River. In between, a lot of oil, and some blood, get spilled, Exxon -- now ExxonMobil, after swallowing Mobil Oil in a $73.7 billion merger in 1998 -- itself becomes much larger and more profitable, and its lawyers and lobbyists have had a lot of work to do to cope with the mess.

Over the last decade, Coll has focused on America's terrorism wars, first with his history of the CIA's involvement in Afghanistan, Ghost Wars: The Secret History of the CIA, Afghanistan, and Bin Laden -- you know, when the terrorists were the "good guys" -- then in The Bin Ladens: An Arabian Family in the American Century he looked further into the confluence of business interests and terror in the middle east. But before that he had started out writing about business, with previous books on the breakup of AT&T and the takeover of Getty Oil. The current book combines all those interests, especially given how large and rich ExxonMobil is, and how it moves all over the world, looking for oil and finding trouble.

One persistent theme is how companies like ExxonMobil have come to operate both parasitically and independently of American interests, at least as understood by successive presidential administrations. The book jumps fairly quickly from the 1989 Exxon Valdez spill to the 1998 ExxonMobil merger, so it mostly overlaps with what Billmon liked to call the Cheney administration. Naturally, ExxonMobil CEO Lee Raymond was very close to Cheney -- a participant in Cheney's secretive energy planning sessions, and beneficiary of numerous special favors -- but ExxonMobil never had a problem getting access and government help. (The Clinton administration's rubber stamp approval of the merger, which combined the two largest Standard Oil companies broken up in the famous 1911 antitrust case, was the most remarkable favor, but the Obama administration followed suit in helping to secure ExxonMobil's takeover of the large Qurna oil field in Iraq -- maybe that war was only about oil after all?)

On the other hand, Raymond emphatically rejected the notion that ExxonMobil was an American company, insisting that his shareholders, employees, and customers were scattered all over the world, and that he had no special fealty to U.S. foreign policy. Given how confused US foreign policy wonks are about oil policy -- someone smarter than Michael Klare should write a book about the abuse of idiocy in the US trying to protect its supply of cheap oil with military efforts which disrupt markets and lobbying in favor of multinationals like ExxonMobil that benefit much more when oil becomes more expensive -- Raymond is refreshingly focused. He uses Washington when it's useful for ExxonMobil, and steers clear when they're more trouble than they're worth.

There are many case examples of the latter, especially in Africa, where ExxonMobil is a more significant force than the US government. Equatorial Guinea is one case in point: its corrupt dictator, Teodoro Obiang Ngeuma, ran up such a bad human rights record that even the Bush administration kept him at arm's length, but ExxonMobil had no problems doing business with him. Similar stories appear in chapters on Indonesia, Nigeria, and Chad, although in those cases the US did eventually get involved, providing guns to supposedly to quell civil wars. (The Aceh revolt in Indonesia eventually ended in negotiation; piracy in Nigeria is an ongoing problem, and Chad remains all the poorer, but at least the oil still flows.)

Probably the most egregious example of ExxonMobil pursuing its private interests over U.S. government wishes was when Raymond went to China to rail against the Kyoto agreement, which ExxonMobil was also lobbying against in Washington. That may seem pale compared to his predecessor, Walter Teagle, who sold patents to I.G. Farben in the late 1930s then refused to manufacture synthetic rubber without the Nazis' permission. But it is an example both of how narrowly ExxonMobil targets its interests, and how single-mindedly they pursue them with all their might.

The most notorious example is ExxonMobil's propaganda war against the idea of global warming, where they have pulled out all of the usual tricks, including creating front groups and hiring scientists to disinform the public. They weren't the only oil company to do so, but had considerable impact given their immense size and drive. Coll seems to admire Raymond for his disciplined management, but starting so late in the story we never get a clear picture of how Exxon got to be so large.

Under John D. Rockefeller, Standard Oil had become the most notorious monopoly of the gilded age. In 1911, the company was broken up into 34 separate companies, many of them delineated by state boundaries, like Standard Oil of New Jersey (future Exxon), Standard Oil of New York (future Mobil), California (Chevron), Ohio (SOHIO), and Indiana (Amoco). I'm not sure how Exxon (as we'll call Standard of New Jersey even before its 1972 rebranding) came to be the largest of the "baby Standards," but during Teague's management (1917-42) the company grew its market share from 2% to 11.5%. One chunk was their purchase of 50% of Humble Oil (one of the larger independents in Texas) in 1919 -- they bought up the rest of the stock in 1954. But they also made significant claims outside the US, like their controlling interest in Canada's Imperial Oil. They also owned fields in Venezuela, Iran, and elsewhere. After WWII they were the largest of the "seven sisters" that were organized to take over Iran's oil after the CIA's 1953 coup. Before that, in 1948 they took a large (30% stake) in Aramco, which became Saudi Aramco when it was nationalized in the 1970s. The nationalizations undercut their reserves, but they were often replaced by deals where Exxon would continue to refine the no-longer-owned crude, so they maintained their standing as the largest multinational oil company.

Mobil (originally Standard Oil of New York, reduced to SOCONY, then several other variants) also grew by acquisitions, like Magnolia Oil and Vacuum Oil) and foreign exploration, inheriting Standard's interests in China, and adding Vacuum's stake in Australia. Mobil was generally the second largest oil company in America. At the time of the merger, it had many of the fields that figure prominently in the book: Aceh (Indonesia), Nigeria, Equatorial Guinea, and a huge gas field in Qatar. As Coll sums up, "ExxonMobil had always been better at buying other people's oil than at finding it."

One particular aspect of history that Coll ignores by starting in 1989 is the role the oil companies interacted with US foreign policy, especially early on. The US didn't actually have much of a foreign policy before WWII, and in the early postwar period the State Department and the CIA tended to look to US companies for insight and expertise abroad -- especially in the Middle East. This could on occasion be disastrous, as when the CIA intervened in Iran in what was basically a dispute between Anglo-Iranian Oil (later BP) and a newly-elected democratic government in Iran over an extremely one-sided and unfair contract. (Much the same as the CIA intervened in Guatemala at the behest of United Fruit.)

The merged ExxonMobil's revenues in its first year were $228 billion. By 2011, they had grown to $486 billion, with $41.1 billion in profits. Lee Raymond retired in 2006 with a package valued at $400 million. He was replaced by Rex Tillerson. Raymond had moved the corporate headquarters to Irving, Texas, a suburb of Dallas that seemed to fit the management culture better than. The book includes some numbers of how much ExxonMobil put into various political campaigns, and needless to say they favored Republicans -- even in 2008, when the Democrats won massively, their take was only 11% -- but the numbers are piddly compared to what the Koch family spends. Still, you can't say that they were less effective: they've pretty much won every legislative and regulatory battle they've entered, and have had no problems getting Democrats like Clinton and Obama to do their bidding.

That is a huge flaw in our political system: we basically put government favor up to the highest private bidder, while at the same time not expecting corporations to take anything more than their shareholder's narrow pecuniary interests into consideration. In this system, the oil and banking industries loom exceptionally large, and their influence has been exceptionally corrupting.

One problem here is that oil has always engendered the worst in extreme right political crackpots -- Bryan Burrough's The Big Rich: The Rise and Fall of the Greatest Texas Oil Fortunes is a veritable catalog of them, although you'd also have to factor in non-Texans like the Buckleys, the Kochs, and the Cheneys. This has always struck me as rather perverse, as the root of all oil fortunes is a paper from a government giving someone arbitrary ownership of unseen pockets of hydrocarbons buried millions of years ago: nothing is more exemplary of the old adage about being born on third base and thinking you've hit a triple. But whereas such crackpots will always be with us, it is the sheer size of the oil industry that makes them so dangerous, and that size is readily inflated as every uptick in gasoline prices magnifies the value of unpumped reserves.

Those reserves, by the way, play a crucial role here. ExxonMobil's power -- in particular, their ability to merge with Mobil and to buy out XTO -- depends on their stock price, which is normally an estimate of future profitability: for an oil company, that mostly means the product of current profitability times proven reserves. Coll shows how nearly every strategic move ExxonMobil has made has been driven by the need to increase their reserves to make up for their yearly production. For several reasons this has been a tough problem, which for a long time Raymond was able to finesse by unorthodox accounting.

Coll highlights the problem of "resource nationalism": most nations, especially those long victimized by Euroamerican imperialism, insist on owning their own oil, even when in order to exploit that oil they wind up making production deals with foreign companies. (The first "third world" country to nationalize its oil fields was Mexico, and I'm pretty sure the foreign company was Exxon.) Since then Venezuela, Iran, Iraq, Saudi Arabia, and other major producers have taken their reserves off the company books, and it will be tempting for countries like Nigeria and Angola to do the same.

Another problem, which Coll doesn't cover in any systematic way, is that oil fields run dry, that there are only a finite number of them, and that new discoveries of oil fields are increasingly hard to find. This is consistent with the "peak oil" theory, which in its original version predicted that US oil production would peak in 1970 and decline thereafter. (In fact, the peak year was 1969. That this was non-calamitous was due to our ability to import oil to cover the shortfall, but that immediately resulted in the US turning its trade surplus into a deficit, which has only widened ever since.) Kenneth Deffeyes predicted that the peak for world oil production would be in the 2000-2005 window. (Results are less clear: production has basically plateaued since 2000, with a peak in 2005, but a slight rebound in 2011.)

What is clear from Coll's book is that the only way ExxonMobil has been able to increase its reserves is by counting things that wouldn't have been counted before. For starters, ExxonMobil has been replacing oil fields with gas fields -- both large, conventional ones like those in Aceh (Indonesia) and Qatar, and more recently with a lot of nonconventional fields (XTO was a major player in shale gas, which is obtained by horizontal drilling and "fracking" -- fracturing the shale with explosive blasts of highly toxic fluids). Gas is less valuable than oil, more expensive to drill, and much more expensive to distribute (ExxonMobil has an advantage in its experience in liquifying natural gas, but it's still relatively expensive).

Secondly, offshore oil deposits are much more expensive to drill than onshore, and deepwater even more so (especially if you factor the risks Deepwater Horizon ran into), and that's where many recent finds are. ExxonMobil is not a big player there, but is so desperate for new reserves they want to.

Third, there are nonconventional oil deposits, which have never been economically efficient but come more and more into play as oil prices rise. These include a couple of giant tar sand deposits, one in Canada, another in Venezuela. ExxonMobil has a stake in the former, and built (and gave up) a processing plant in the latter. Technology is likely to make these deposits more accessible, but they are very expensive to develop and produce, have massive environmental impact, and have very low recoverability ratios.

(When you initially drill into an oil reservoir, it will probably be under enough pressure that it will gush oil out: that's as good as it gets. When the pressure drops, you can still pump oil out, but you have to burn energy to run the pumps. You can also drill another hole, and pump water into the reservoir, repressurizing it to push more oil out, but before long most of what you're pumping out is water you pumped in, so that it some point it costs you as much to pump as the oil you get is worth. There are a few more techniques that help, but eventually you stop, leaving unrecoverable oil in the reservoir. Tar sands are worse because the tar isn't liquid, so can't be pumped, unless you can figure out a way to melt it. Until recently, it's mostly been strip-mined like coal, then cooked, which means you can only get to near-surface deposits, and even that is expensive, not to mention messy. Oil shales are even worse. Richard Heinberg has written about this sort of thing many times; e.g. in The Party's Over: Oil, War and the Fate of Industrial Societies. He tends to be very pessimistic, but raises valid questions.)

This increasingly frenzied search for bookable reserves is the reason why people think Bush's invasion of Iraq was for oil. Indeed, it took a while, but the key feature of ExxonMobil's 2009 deal to take over production of Iraq's Qurna oil field was that the reserves be bookable. The book includes two chapters on Iraq, and a couple more on Russia, which for a while in the kleptocratic 1990s looked like it might be willing to sell off ownership of its oil resources. (The main person interested in selling was Mikhail Khodorkovsky, who is currently off the market, doing time in one of Putin's jails.) That leaves only one major underdeveloped oil power in need of regime change, and that is the one you hear so much misleading propaganda about: Iran. (Embargoing Iran's oil does three things: it starves Iran, hopefully causing popular unrest; it reduces the world's oil supply, resulting in higher prices and profits for the oil companies; and it keeps oil in the ground, where it can eventually be booked if and when Iran adopts a legal system more friendly to ExxonMobil and its ilk.)

Coll's book raises as many questions as it answers. It offers a sobering demonstration of how one domineering executive, Lee Raymond, has been able to control, tune, and limit critical thinking within an organization that actually employs 86,000 people. Single-mindedness, as much as anything else, has made ExxonMobil a formidable force, both in its pursuit of profit and in its denial of responsibility. They, as much as anyone, have kept us from any sort of serious discussion about the declining quantity and quality of oil and gas, about what a more conserving approach to those resources would really mean for growth, about whether indeed that might be a better idea. They have been nothing less than deceitful about their environmental record, and especially about the potential effects of pumping so much carbon dioxide into the atmosphere. And they have used every ounce of their political clout to preserve the fantasy that we'll never have to face a world where oil isn't infinitely abundant, even though nothing could be clearer when you fill up your car.

This should be a cautionary tale against letting corporations get too big and granting them too much influence. We just passed the 100th anniversary of the breakup of Standard Oil, and in that century we have become markedly more cynical about democracy and remarkably more naive about corporations. On the other hand, if you read this closely, you can sense that ExxonMobil's triumphant era is coming to a close. Indeed, the merger mania of the 1990s -- not just Exxon + Mobil but BP + Amoco and Conoco + Phillips and all the rest -- were a desperate attempt to fall upward, one where the companies have mostly been saved by rising prices. On the other hand, there are any number of forces that could force us to rethink not our dependency on oil so much as our blind faith in oil companies. Of course, one could have said that just as emphatically about banks 3-4 years ago, but our political leaders utterly failed to face up to the challenge. It is, for now at least, so much easier to pretend all is well, or to blame it on your choice enemies.

For more "quotes and notes" see the book page.