The King of Oil: The Secret Lives of Marc Rich

Khomeini’s Islamic revolution, and even in South Africa after the end of apartheid. The ability to maintain contacts in Cuba and Iran was something that American foreign policy had not been able to duplicate.
    Rich went where others feared to tread—“the road less traveled,” as an employee told me. This was true not only in a geographical sense, as was the case in countries such as Angola or Zaire where markets had yet to be developed, but also in a moral and legal sense. Rich had no qualms about supplying countries such as Cuba, Iran, or apartheid South Africa—all countries that were subject to either American or international embargos. These contracts represented very lucrative deals for Rich, as these countries were willing to pay a premium for Rich’s risks in order to meet their own demands. Rich soon developed a reputation—he would do just about anything for money.
    Rich was a mediator who brought together business partners who officially wanted nothing to do with one another. Iran and Israel. Arab states and South Africa. Marxists and capitalists. A further example that has remained a secret to this day: Nicaragua under Daniel Ortega’s Sandinista government brought in Marc Rich to sell the cheap oil it received from “socialist brother nations” such as Libya or Algeria on the global market. “I wanted the oil, and they needed the money,” one of Rich’s employees who was involved in the deal in the 1980s told me. It is a paradoxical situation that helps illustrate the fact that many of the aspects of the commodities trade are not as they appear. While the Left decries Rich as an exploiter of the third world, it was actually his company that helped ensure the financial survival of the Sandinistas, who were idealized as “freedom fighters” by many of the same left-leaning people.
Ayn Rand
     
    If you ask traders about their business, you will hear the same expression over and over again, “The concept of trading is giving a service.” “Trading is a service business. We bring sellers and buyers together and earn a service charge,” as Rich himself describes the trade. It is the realization of the trader principle that the libertarian philosopher Ayn Rand defined as follows: “In any proper deal, you act on the trader principle: you give a value and you receive a value.” 6
    Ayn Rand’s philosophy has had a major influence on Rich’s life. She advocates the virtue of “rational egoism,” which holds that one’s own life is one’s most important value and achieving happiness is one’s most important purpose: “Selfishness means to live by the judgment of one’s own mind and to live by one’s own productive effort, without forcing anything on others.” 7 In her roman à clef
Atlas Shrugged
, first published in 1957, businesspeople are represented as courageous “capitalist heroes” who are driven by their own will to create and are capable of bringing about prosperity. 8 One of the book’s protagonists, Hank Rearden, is an industrialist who begins his career as a simple worker and becomes the director of the largest steel factory in the fictional United States described in the book. He is later taken to court for failure to follow state-mandated sales regulations, and the media denounces him as “a greedy enemy of society.” The similarities between Rich’s fate and Rearden’s are striking.
    You give a value and you receive a value.
Rich and his traders took this theory to the point of perfection, and with it they obtained the long-term contracts they desired. “Marc Rich’s people were always prepared to make a counteroffer such as prefinancing, a contact, or a bank account,” an industrialist from Ghana told me. Marc Rich + Co. took this concept to the point where the company soon began to serve as a kind of investment bank for several developing countries. These were countries that would have had difficulties obtaining credit on the regular financial markets, usually as a result of their poor credit ratings.Even if they could find someone who was willing to offer them credit, the interest rates were exorbitant. Rich’s company financed the construction of mines, smelters, and refineries or the production of oil in Jamaica, Zaire, South Africa, Namibia, and Angola. In return Rich asked for exclusive rights to sell all commodities produced in the country for a period of one year or more.
    “You need us and we need you. This is the way we have to establish our