Arrigo Cervetto (31 May 1957)
Azione Comunista, No. 16
The history of ENI is a curious history. It would merit its own biography, not so much because it could let its imagination run wild, as its American colleagues do when they narrate the adventurous lives of the Morgans or the DuPonts, but because, on the contrary, its chapters would be as grey and monotonous as the incessant development of state capitalism. ENI’s history is that of our modern economy.
Without referring to this, we could not analyse the news that has set the whole world buzzing: ENI and the National Iranian Oil Company have reached an agreement for the setting-up of an Italo-Iranian joint venture with 51% of its shares in Italian hands. The new research and oil exploitation company will have concessions in three Persian Gulf areas; 75% of its profit will go to Iran and the remaining 25% to ENI, which will invest 13 billion lire in this vast operation of collaboration between two state-capitalist enterprises.
Comments on these agreements have been many and varied. The British economic press (the “Financial Times”, etc.) has reacted against the violation of the fifty-fifty rule practised in the Middle East by the seven oil companies that constitute the international cartel and decide the selling prices on the world market. American reaction was not so strong and—as we shall see—not by chance. If we read between the lines, the German press did not conceal its satisfaction—and not by chance, either.
While the press agencies and the numerous newspapers (“Il Giorno”, etc.) that ENI controls and influences (see the generous number of its advertising pages) sought to present the fact as a brilliant operation on the part of Mattei1, Adenauer visited Persia without any fanfare and laid the foundations for new economic agreements.
“La Stampa” (3 April) reported that: a) Germany will help Persia with its agricultural mechanisation and the training of engineers; b) it will provide industrial experts; and c) the German Foreign Market Bank (set up to help exports and 50% financed by the state) will grant Iran a first loan of 150 million marks that will subsequently be doubled.
This is much more than the Honourable Mr Mattei’s initiative. ENI is only one component of a far-reaching imperialist operation that is being effected in the Middle East and that represents the undermining of the Anglo-French positions.
After Mossadegh’s nationalisation, Iran found itself facing an insoluble problem: the lack of necessary capital for the exploitation of its oil and the impossibility of selling its nationalised oil abroad. This is what caused Mossadegh’s downfall, although it did not mean victory for the UK. The American trusts took the place of the Anglo-Iranian Co. In spite of American penetration, Persian oil production has not yet succeeded in reaching its 1953 level. Against this background, the ENI episode emerges as a stage in German-American penetration into the Middle East.
Given the high merger level of US and German financial capital, the fact does not cause any surprise and is to be ascribed to the death blows that have rained down on the British capitalist groups in the Middle East after the «little Suez War». In the face of the stronger, more homogeneous national bourgeoisies of the other Middle East countries (i.e. those bourgeoisies that, in their level of development, have already achieved oil nationalisation, while Saudi Arabia still has monarchical ownership), the treaties for oil exploitation were bound to be modified. Officially, the American companies could not make this modification without compromising themselves in front of the other Middle East countries. ENI therefore went into action. What other explanation could there be? How can the thesis according to which the ENI initiative breaks the monopoly of the international oil trust be taken seriously—as the left-wing press pretends to do? One need only think of what happened when an Italian tanker carried a cargo of nationalised oil during the blockade organised by Mossadegh.
The «Italia» Press Agency itself admits that «strong opposition on the part of the US government to this and similar initiatives is not to be expected, since, broadly speaking, they can be placed within what is defined as the Eisenhower Plan». This leaves little doubt. Moreover, a number of so-called «independent» American oil companies (“independent” because they are not tied to the International Cartel)—Hancock, Signal, Phillips Petroleum, Getty Oil, etc.—are already operating in the Middle East within the framework of the Eisenhower Plan.
What is not so clear is why the CGIL, via the Italian Federation of Chemical and Oil Industry Workers, has approved the ENI initiative, defining it as an anti-trust measure in a communiqué in which, among other things, it says that «besides the innovative significance that could have favourable political repercussions for our country in the Arab world, the agreement we are speaking about is to be seen in a positive light also from the point of view of Italy’s oil and general economy, as well as from that of the function that ENI should have in it».
This is the usual glamorisation of state-owned companies, of support for and collaboration with IRI, of the policy of nationalising the key sectors of the Italian economic structure, and of support for state capitalism passed off as the concrete implementation of the Italian road to socialism, when it is not actually defined as the building of socialism. But support for state capitalism can never be limited to the national sphere and ends up, sooner or later, becoming support for the imperialist policy of international state capitalism.
At this point, nothing is said about the fact that Iran is one of the most reactionary countries of the Middle East, one of the main pillars of the Baghdad Pact, and one of the champions of the anti-Arab struggle; not to mention its decidedly anti-worker government. Furthermore, nothing is said about the fact that the ENI initiative did not regard the Middle East countries that are most recalcitrant to imperialist domination, and that stupid propaganda would like to present as «pro-Soviet».
Even in this case, the facts demonstrate the insubstantiality of demagogy. The most «Western» of the Middle East countries, the one that, unlike Syria or Egypt, does not receive arms from Russia, but from America, is the one that—according to the CGIL strategists—is plotting, together with Mattei, to defeat the international monopoly. A precise analysis of imperialism and of all its forms of development is of absolutely no interest to our economist friends. What they are interested in is ENI, and very many things can be hushed up for the sake of ENI.
In order to speak about it, instead, it is necessary to speak about ENI’s curious history. Two points of reference are enough. At the first point, we find an almost bankrupt Agip, the inglorious blue-eyed boy of the fascist self-reliant policy, but at the same time the fruitful seed of a state capitalism that was yet to be born. Everyone wanted to liquidate it, everyone except those who had blind faith in the healthy development of a national economy based on so-called structural reforms: in other words, an à la Di Vittorio economy, a «labour economy» with a single «boss», the state, which, like the chameleon’s skin, could be by turns the «national interest», the «will of the working masses», «Italian democracy», etc. Everything except what it really is: the tool of the owners of public securities and of IMI, IRI or ENI bonds.
One of those that had «blind faith» was the good Christian Democrat Mattei who, however, did not speak of socialism or become a PCI member, but limited himself to speaking of De Gasperi-style «social time». He pulled up his shirtsleeves and set to work. God rewarded him, together with all those that understood that the magic trick was no longer to be found in the Brusadellis2, but in a hefty parcel of ENI bonds. And the miracle also occurred: the workers that asked for a pay rise of one lira and believed in a socialism that was very similar to the state trust that Mattei was building up got a thrashing, while he himself received honours and money from those who condemned out loud in the USSR what ENI was for Italy.
And this brings us to our second reference point: to the ENI budget. Here are a few figures. Since 1953, ENI has had the rights to seeking and exploiting liquid and gas hydrocarbons in a total area of 5 million 600,000 hectares and of 350,000 hectares in Sicily. In “La Stampa” of 8 April, Didimo estimates that its «profits are to be considered so huge» as to make it «a great financial power». He is not mistaken. From after the war to 1956, the group of ENI companies invested about 15 billion in lire in the hydrocarbon field, and has an annual production worth 45 billion. This rhythm and its investment plan have been expanded within the framework of greater financial investment in all the IRI companies and of the application of the three-year programme of seeking and exploiting hydrocarbons in Italy: in 1956, ENI allocated 75 billion lire. It will therefore seem completely normal that the first 20 billion tranche of the 6% ENI-Petrolio bond issue launched in September 1956 was bought out in only nine days.
This financial development is closely linked to a productive development that, as regards both the general and specific indices of the hydrocarbon sector, greatly exceeds the growth rate of the Soviet Five-Year Plans. Nevertheless, we would not dream of presenting the development of ENI as an example of «the building of socialism»! What could certain theoreticians of Italy’s natural gas production that has increased more than 20 times between 1938 and today say?
Between 1953 and 1955 alone, natural gas production increased by an average of 27% a year, and its contribution to the national energy balance sheet rose in the same period from 8.5 to 11%. In 1955, 3.65 billion cubic metres of natural gas were extracted; in 1956, production reached 4.3 billion cubic metres.
Thanks to this very high level of production, ENI has built a network of gas pipelines that is the fourth longest in the world (4,160 km), after the US, the USSR and Canada, and has boosted the supply capacity of the whole network to 15 million cubic metres per day. ENI has 1,783 customers in big industry and local government bodies, and expects another 400.
It is interesting to know how the natural gas distributed by ENI in 1955 was used. Of 3 million 505 thousand cubic metres, 2 million 311 thousand were for industrial thermal applications, 503 thousand for the thermoelectric industry, and only 300 thousand for civil use.
Given the prices quoted by ENI, no one has yet demonstrated that the workers’ families have had any concrete advantage from them. And then there is a truth that the «nationalisers» know by heart, but that they take good care not to say when they go out into the streets to poll votes: any nationalised state-owned industry has to quote monopolised market prices and achieve an average rate of profit if it wants to proceed with its economic development. In short, the workers receive no benefit.
It is thus that ENI, regulated by the laws of capitalism that are common to all, from private monopolies to the smallest workshop, has planned a vast, 200-billion-lire development programme embracing various sectors—AGIP Mineraria, Somicem and SNAM, just to quote the main companies affiliated to ENI—that are the tools of this programme. SNAM and Dalmine (another IRI industry) built the big Suez-Cairo oil pipeline. Similar initiatives, to be carried out with Montecatini and Innocenti, are programmed in other parts of the world.
ENI has a huge chemical factory planned for Ravenna. It will produce an annual 600,000 tons of nitrogen compounds, thanks to which state intervention in this field, too, will play a very important part in Italy’s current overall production of 1 million 700 thousand tons. According to the hilarious labour economics theory of PCI stamp, the ENI intervention in the nitrogen compounds field should annihilate the Montecatini monopoly, bring affluence to the farmers, improve the lot of the middle class, and make the workers rejoice. Another stage in socialism, in short. Instead, the opposite will happen: nitrogen compound prices will be lowered (as Montecatini is already doing), industrial investment in agriculture will be facilitated, and this will lead, to a very relative but constant extent, to greater agricultural production and a drop in the employment of farm labourers. The rural middle class, as is normal and logical, will become smaller and more proletarianised. This will undoubtedly mean economic progress, in the sense that state-owned and private monopolies will merge and will grow stronger, creating firm bases for a future socialist economy, i.e. precisely the opposite of what the PCI and CGIL theoreticians would like, ready as they are to cry victory for socialism if only they could put a Pesenti in the place of Bo and a Sereni in the place of Bonomi3.
ENI’s left-wing supporters will say yet again that we are maximalists, sectarians and breakers-up of the workers’ movement because we refuse to listen to the sacred voice of national interests.
We bet that, together with the workers deceived by ten years of democratic-constitutional poison, the big «national savers» will also clap their hands. At root, it matters little to them whether they are welcomed by Valletta with the «600» or by Mattei from the Qom Desert.
“Azione Comunista”, No. 16, 31 May 1957
Source: Unitary Imperialism, Volume I, pp. 227-231.
1 Mattei, Enrico (1906–1962): president of Agip in 1945, he founded ENI in 1952.
2 Brusadelli, Giulio (1878–1962): an important Lombard financier and cotton baron who grew rich through his daring and often successful gambles on the stock exchange.
3 Pesenti and Sereni were two PCI deputies; Bo and Bonomi two Christian Democratic deputies.