By William M. Stewart

Just why is Iraq so important? The short answer is not Saddam Hussein and his alleged weapons of mass destruction, but "oil." There is no doubt that Saddam and his regime are truly dreadful, and that they pose a very real threat to their neighbors, if not to the United States. Saddam demonstrated his intentions once before when he invaded Kuwait.

But there is more at work here than defense and the politics of defense. Petrel Resources, a Dublin-based company with extensive interests in Iraq, says, "No mineral has better economics than oil and no country has better oil economics than Iraq." The long-term potential for peaceful Iraqi development is enormous, which is the primary reason why such countries as France and Russia have been reluctant to take a strong stand against Baghdad. They may well have genuine reservations about the legitimacy of a U.S.-led attack against Iraq, but their fundamental objections lie in their own economic self-interest, specifically the roles they could play in Iraqi economic development. Moreover, the old Soviet Union helped to build Iraq's military forces, for which a lot of money is still owed. Moscow closely followed the progress of the 1991 Gulf War. That military connection is thought to give Russia a significant leg-up in Iraqi development once U.N. sanctions are lifted.

Is Iraq that big and important? Consider: Iraq has 15 percent of the world's known oil reserves: some 115 billion barrels of proven reserves and up to 300 billion barrels of possible reserves. That's a lot of oil. Only Saudi reserves are greater. But other factors make Iraqi oil even more desirable than Saudi black gold. Ninety percent of the possible oil fields in Iraq are as yet unexplored, a golden opportunity for foreign investment and development -- and profit. Only 2,000 wells have been drilled in Iraq compared to one million in Texas. By way of comparison, eight out of 10 wells drilled in Iraq have struck oil; in Saudi Arabia the rate is less than half. Moreover, Iraq is the world's lowest-cost producer; it costs less than $1 a barrel to produce.

As the world is now consuming more oil than it is replacing through discoveries, Middle Eastern oil, and especially Iraqi oil, is growing more and more important. There is nothing necessarily wicked here, only old-fashion economics. But Iraqi oil is curiously absent from the heated discussion over going to war with Baghdad.

The world's major oil companies, however, including U.S. companies, are intensely interested in Iraqi oil. John Teeling, chairman and founder of Petrel Resources, says that most of the big U.S. companies maintain a "watching brief," using their European offices to maintain their Iraqi contacts.

None of this, of course, is unknown to President George W. Bush and Vice President Dick Cheney, both of whom have deep roots in the oil industry. There are even suggestions that because of their oil background, it is Iraqi oil that is driving Bush and Cheney in their determination to get rid of Saddam. That strikes me as just a little too cynical; there is enough in Saddam's record to justify a move against him, oil or no oil. But it is also true that much of the Iraqi oil exported under the U.N.'s strict oil-for-food program ends up in U.S. refineries. Clearly, oil is strongly connected to the current debate over what to do about Iraq.

While oil remains a constant factor in the debate over Iraq, the debate itself has undergone a remarkable evolution. For several months, the steady drumbeat of war was maintained by such administration hard-liners as the vice president and Secretary of Defense Donald Rumsfeld, disturbing not only America's friend and allies but many Americans as well.

In the past few weeks, however, much has changed. House Majority Leader Dick Armey, a bluer-than-blue conservative, spoke out against any unilateral U.S. action against Iraq unless the White House presented a better case. Other Republican members of Congress made similar noises.

Then Brent Scowcroft, national security adviser to both President Gerald Ford and the first President Bush, advised against unilateral action. Not by accident did he choose The Wall Street Journal, the ultimate redoubt of high republicanism, to voice his opinion. Scowcroft was followed by former Secretary of State James A. Baker III in The New York Times, expressing similar views. Then Secretary of State Colin Powell finally spoke out in a BBC interview in South Africa urging the reintroduction of U.N. weapons inspectors to Iraq, an action opposed by the vice president.

By the time Congress reconvened last week after a summer recess, it was clear that the momentum toward war had run into massive domestic opposition. The president wasted no time in assembling key Republican and Democratic members of Congress for a session in the Cabinet Room at the White House. By all accounts he made a strong plea for removing Saddam Hussein but presented no new evidence to support his case. At the same time, he announced a diplomatic blitz that included a Camp David visit this weekend with Prime Minister Tony Blair ("War Summit" screamed the British headlines), a Monday meeting with Canadian Prime Minister Jean Chretien, telephone calls to the leaders of Russia, France and China, and a UN address later this week. There seemed little doubt that the White House was back in the business of trying to build a consensus, something his father would applaud, but his hard-line advisers despise. Stay tuned.