The Oil Greasing the World Order

The two-week ceasefire announced on April 7, 2026 was not brokered by the United Nations. It was not brokered by NATO. It was not brokered by the European Union or any institution of the rules-based order that was supposed to prevent this war from happening.

It was brokered by Pakistan — with China behind it.

Field Marshal Asim Munir was on the phone all night. Prime Minister Shehbaz Sharif posted on X requesting both sides to stand down. Iran’s 10-point proposal — demanding sanctions relief, frozen assets, U.S. withdrawal from regional bases, nuclear enrichment rights, and reparations — was transmitted through Islamabad, according to NPR and Axios. But the diplomatic architecture behind Pakistan’s mediation was built in Beijing.

On March 31, Pakistani Foreign Minister Ishaq Dar flew to Beijing directly after chairing a four-party meeting in Islamabad with Turkey, Saudi Arabia, and Egypt. There, he and Chinese Foreign Minister Wang Yi released a joint five-point proposal — calling for an immediate ceasefire, an end to attacks on civilian infrastructure, safe passage through Hormuz, and a return to dialogue.

Wang Yi had already made 26 phone calls to parties including Iran, Israel, Russia, and Gulf states, according to China’s Ministry of Foreign Affairs. Beijing dispatched a Special Envoy to the region. An Arab diplomat told Middle East Eye that Tehran would look to Beijing as the “guarantor of any peace deal.”

The ceasefire that stopped “Power Plant Day” came through a country that is not on the Security Council and a country that abstained from the resolution condemning Iran — the two powers now positioning themselves as the alternative axis of the post-American Middle East. The architecture of 1945 was not just bypassed. It was replaced, in real time, by the architecture that will succeed it.

To understand why, you have to go deeper than the institutions. You have to go to the resource the institutions were built to control.

The World Order Was Always About Energy
The post-1945 order is taught as a system of rules: the UN Charter, the Geneva Conventions, the Bretton Woods institutions, the alliance structures. But beneath the rules was a material foundation. The system ran on oil. And the architecture — the Security Council vetoes, the military alliances, the base networks, the client monarchies — was designed to ensure that the victors of 1945, and specifically the United States and Europe, controlled who got it.

The Nixon Doctrine of 1969 made this explicit: Iran, Israel, and Saudi Arabia would be the three pillars of U.S. power in the Middle East. Iran was the gendarme of the Gulf. Israel was the military guarantor. Saudi Arabia was the price regulator. All three served the same function: ensuring that the oil that powered the Western and Global North’s industrial economy flowed on Western terms.

When one pillar became too independent, it was replaced. When the replacement became an enemy, the enemy was used to justify the architecture’s expansion. This is the cycle. It has run for 73 years. The 2026 war is its latest iteration — and possibly its last.

Act I: Install the Shah (1953)
In 1953, the CIA and MI6 overthrew Iran’s democratically elected Prime Minister Mohammad Mossadegh after he nationalised the Anglo-Iranian Oil Company. Declassified CIA documents, released in 2013 and reported by the New York Times, confirm the coup was “an American project from beginning to end.” The U.S. installed Shah Mohammad Reza Pahlavi as an absolute monarch. Western oil companies took 80% of Iran’s oil profits — 40% to American firms, 40% to the British. CIA historian David Robarge, in an internal review declassified in 2014, stated: “The CIA carried out a successful regime change operation. It also transformed a turbulent constitutional monarchy into an absolutist kingship.” SAVAK, the Shah’s secret police, was created with CIA and Mossad support, according to a classified Senate Foreign Relations Committee report later made public.

The pattern: nationalise your own oil, get overthrown. Accept Western terms, get propped up. The Shah understood this. For 25 years, he played by the rules.

Act II: Discard the Shah, Facilitate Khomeini (1979)
Then the Shah stopped playing. When he attempted in the 1970s to control oil prices through OPEC and cancel the 1954 consortium agreement — the same agreement imposed after the coup — it resulted in what CIA historian Robarge called “a massive decline in US support” that “ironically, hastened his downfall.” The Shah wrote in his memoir ‘Answer to History’ that Western forces conspired against him because of “his manipulation of oil prices.”

The declassified record — released through the National Security Archive at George Washington University, BBC Persian’s investigation of State Department cables, and RFE/RL’s reporting on CIA analyses — shows what happened next.

At the Guadeloupe Conference, January 4–7, 1979, Carter, British PM Callaghan, French President Giscard d’Estaing, and West German Chancellor Schmidt discussed the Iranian crisis. According to Carter’s own notes, archived at the Carter Presidential Library, the leaders concluded the Shah’s position was untenable. Nine days later, on January 16, the Shah left Iran.

On January 14, Secretary of State Cyrus Vance cabled U.S. embassies in Paris and Tehran: “We have decided that it is desirable to establish a direct American channel to Khomeini’s entourage” (declassified State Department cable). On January 15, U.S. official Warren Zimmermann met Ebrahim Yazdi, Khomeini’s representative, in Paris. They met three times. On January 27, Yazdi gave Zimmermann a letter from Khomeini personally addressed to Carter, promising to protect “America’s interests and citizens in Iran” if Washington pressured the military to stand aside.

Carter sent General Robert Huyser to Tehran — not to save the Shah, but to prevent the military from staging a coup against the revolution, and to convince Iranian generals to meet with Khomeini’s second-in-command, Beheshti. By late January, Carter’s government admitted the military would have “no fundamental problems” with abolishing the monarchy. On January 11, Carter told the Shah to “leave promptly.” On February 1, Khomeini returned. By February 11, the military declared neutrality.

The pattern completed: the Shah tried to control his own oil. The West withdrew support. The U.S. opened a channel to Khomeini, neutralised the military, and facilitated the transition — choosing the Islamists over the communists because communists might align with Moscow.

Act III: The Kingdoms and the Jihadists
While Iran became the enemy, the other Gulf monarchies became the vassals. And the vassals had a function beyond oil production: they funded the ideology that the West would later use as its primary justification for military presence in the region.

Between the mid-1970s and 2002, Saudi Arabia provided over $70 billion in overseas development aid, the vast majority religious — specifically the propagation of Salafism. Hillary Clinton, in a leaked 2013 speech: “The Saudis have exported more extreme ideology than any other place on earth over the course of the last 30 years.” Germany’s Vice-Chancellor Sigmar Gabriel warned: “Wahhabi mosques are financed all over the world by Saudi Arabia.” Former CIA officials and analysts consistently linked Gulf funding to extremist networks.

The funding built the madrassas in Pakistan that produced the Taliban. It built the networks in Afghanistan that produced Al-Qaeda. It built the mosques in Europe that radicalised the 9/11 hijackers — 15 of 19 of whom were Saudi nationals.

The United States and Europe tolerated all of it because the relationship — oil, arms sales, petrodollar recycling, basing rights — was more valuable than stopping the ideology.

China understood this architecture and built its alternative quietly. While the U.S. controlled Gulf oil through military bases and security guarantees, China became the Gulf’s largest customer through trade. By 2025, China was importing more oil from Saudi Arabia, Iran, Iraq, and the UAE than any other country.

Act IV: Why Palestine Was Never Resolved
The Palestinian question is unresolved not because it is unsolvable but because its resolution would remove the primary justification for the architecture. The U.S. has vetoed more than 40 UN Security Council resolutions on Israel-Palestine since 1972. The unresolved conflict serves every player — Israel, the Gulf monarchies, jihadist networks, and the U.S. itself.

Act V: The Post-Soviet Pivot — From Communism to Jihadism
The CIA-Saudi-ISI alliance that funded the Afghan mujahideen created networks that later became al-Qaeda. The War on Terror expanded U.S. military presence but did not eliminate the ideology. The extremist ecosystem persisted because it served the architecture.

Act VI: Why Saudi Arabia Is Modernising
Saudi Arabia’s reforms are a strategic shift as the old model of ideological influence loses control. But the dependency on U.S. security guarantees remains. The 2026 war exposed the vulnerability of hosting U.S. bases.

The Cycle
1953: Install the Shah.
1979: Replace him with Khomeini.
1980s: Fund jihadists.
2001: War on Terror.
2026: War against Iran, with China emerging as mediator.

The cycle is the architecture working as designed.

Peace Is Also Power Play
The ceasefire is not the end. It is repositioning. Iran seeks leverage. The U.S. recalibrates. Pakistan asserts relevance. China positions itself as guarantor of the new order.

The world order of 1945 was not a system of rules. It was a system of energy control dressed as rules. When the rules are broken by the controller, legitimacy collapses but control remains — until a new architecture replaces it.

What is emerging now is not a new rules-based order but a new energy-control system led by different powers. The structure will likely repeat: whoever controls the resource writes the rules.

Unless that structure changes fundamentally, the cycle will repeat.

Peace is also a power play. The question is: whose power, and over what?

VK Shashikumar is a former roving foreign affairs correspondent who covered West Asia, and later set up the investigations team at CNN-IBN (now News18).