Crude capitalism, new centres of capital accumulation and the Middle East’s place in global imperialism: An interview with Adam Hanieh
[Editor’s note: Marxist scholar Adam Hanieh will be speaking at Ecosocialism 2025, September 5-7, Naarm/Melbourne, Australia. For more information on the conference visit ecosocialism.org.au.]
Adam Hanieh is a professor of Political Economy and Global Development at the University of Exeter, whose research focuses on capitalism and imperialism in the Middle East. His latest book is Crude Capitalism: Oil, Corporate Power, and the Making of the World Market. In this broad-ranging interview with Federico Fuentes for LINKS International Journal of Socialist Renewal, Hanieh explores the need to foreground value transfers in understanding imperialism, Israel’s role in global fossil capitalism and the rising influence of the Gulf states.
Over the past century, the term imperialism has been used to define different situations and, at times, been replaced by concepts such as globalisation and hegemony. Does the concept of imperialism remain valid? If so, how do you define it?
It certainly remains valid and there is a lot to learn from both the classic writers on imperialism, such as Vladimir Lenin, Nikolai Bukharin and Rosa Luxemburg, as well as from later contributions and debates, including by anti-colonial Marxists of the ’60s and ’70s.
At the most general level, I define imperialism as a form of global capitalism centred on continued extraction and transfers of value from poorer (or periphery) countries to rich (or core) countries, and from classes in poorer countries to classes in rich countries. I think there is a tendency to reduce imperialism to simply geopolitical conflict, war or military intervention. But without this core idea of value transfers we cannot understand imperialism as a permanent feature of the world market that operates even in supposedly “peaceful” times.
The ways these value transfers take place are complex and require careful thought. The export of capital as foreign direct investments into dominated countries is one mechanism. The direct control and extraction of resources is another. But we also need to look at the various financial mechanisms and relationships that have been widespread since the 1980s: for example, debt service payments made by countries in the Global South. There are also differences in the value of labour power between core and periphery countries, something that theorists of imperialism from the ’60s and ’70s, such as Samir Amin and Ernest Mandel, explored. Unequal exchange in trade is another route. And migrant labour is a really important further mechanism through which value transfers take place. Thinking about these multiple forms opens up our understanding of the world today — beyond just the question of war or inter-state conflict.
Approaching imperialism through these transfers of value helps reveal who benefits. Lenin foregrounded finance capital, which was the result of the increasingly integrated control of banking capital and industrial, or productive, capital. That remains valid. But it is more complicated today, in that some layers of dominated bourgeoisies in the periphery have become partially integrated into capitalism in the core. They not only often have citizenships in those countries but benefit from these imperial relationships. There is also a lot more cross-border ownership of capital and the rise of offshore financial zones, which makes it much more difficult to trace the control and flow of capital. Understanding imperialism today requires better mapping who benefits from such integration into core centres of capital accumulation, and the ways in which different financial markets are connected.
A third feature that arises from these transfers of value is the concept of the labour aristocracy. This was so important to discussing colonialism and imperialism, going all the way back to Karl Marx and Friedrich Engels, but is often misconstrued or left out of contemporary Marxist thinking. If we go beyond Lenin's pamphlet, Imperialism, the Highest Stage of Capitalism, to look at his other writings on imperialism, we find that he dedicated significant attention to analysing the political implications of imperial relationships in creating social layers in core countries whose politics became oriented and connected to their own bourgeoisie. This insight remains valid and needs to be foregrounded again. In Britain, for example, it helps to explain the clearly pro-imperialist character of the British Labour Party.
One feature of contemporary imperialism that was not well theorised in the early 20th century is how imperial domination is necessarily bound up with particular kinds of racist and sexist ideologies, which help justify and legitimate it. We can see this today in the context of Palestine. It is really important to integrate anti-racism and feminism into how we think about capitalism, anti-imperialism and anti-imperialist struggles. Neville Alexander did this in the South African context, as did Walter Rodney, an anti-colonial Marxist from Guyana, and Angela Davis in the United States.
Many would agree that after the Cold War, world politics came to be dominated by US/Western imperialism. Yet a relative shift appears to be taking place with China’s economic rise, Russia invading Ukraine, and even smaller nations, such as Turkey and Saudi Arabia, flexing military power beyond their borders. In general terms, how can we understand the dynamics at play within the global imperialist system?
Since the early 2000s, we have seen the rise of new centres of capital accumulation outside of the US. China stands at the forefront of this. This was initially connected to the flow of foreign direct investment into China and the wider East Asian region, aimed at exploiting cheap labour as part of a reordering of global value chains. But since then, China’s rise has been associated with a relative weakening of US capitalism in the context of profound and deepening global crises.
This relative erosion of US power can be seen across various metrics. Over the past three decades, US domination of key technologies, industries and infrastructures has weakened. One indication is the fall in the US’ share of global GDP from 40% to about 26% between 1985-2024. There has also been a relative shift in ownership and control of the world’s biggest capitalist firms. The number of Chinese firms on the Global Fortune 500, for instance, overtook the US in 2018 and remained that way until last year, when the US regained leadership (139 US firms compared to 128 Chinese). China’s representation on this list has risen from just 10 firms in 2000. While China’s rise has largely been at the expense of Japanese and European firms, there has also been a drop in US control of big capital: in the past 25 years, the US’ share of the Global Fortune 500 has fallen from 39% to 28%.
Importantly, these indications of relative US decline are reflected domestically. US capitalism is wracked by severe social problems: declining life expectancy, mass incarceration, homelessness, mental illness, and a collapse of essential infrastructure. Neoliberalism and the extreme polarisation of wealth has eviscerated the capacity of the US state to respond to major crises — as seen with the COVID pandemic and, most recently, in the 2024 hurricane season and the January 2025 Los Angeles fires.
But we need to emphasise the relative weakening of US strength. I do not believe an imminent collapse of US dominance is on the cards. The US still retains an enormous military advantage over rivals, and the centrality of the US dollar is not in question. The latter is a major source of US power because it allows the US to exclude competitors from US financial markets and the banking system (particularly evident since 9/11). So much US geopolitical power is articulated through its financial dominance — another reason why we need to consider imperialism beyond simply its military forms.
There is also a bigger picture to these global rivalries that we should emphasise: the multiple and interconnected crises that now mark capitalism globally. We can see this in the stagnation of profit rates and the large pools of surplus money capital seeking valorisation; the huge rise in public and private debt; overproduction in many economic sectors; and the stark reality of the climate emergency. So, when we talk about the dynamics of the global imperialist system, it is not simply a question of inter-state rivalries and measuring US strength versus other capitalist powers. We need to set these conflicts within the longer-term systemic crisis that all states are trying to navigate.
How do you understand the rise of US President Donald Trump in all this?
Among some liberal commentators, Trump is frequently portrayed as some kind of mad egoist overseeing an administration hijacked by billionaire right-wing extremists (or secretly run by Russia). I think this perspective is wrong. Regardless of Trump’s personal narcissism, he represents a clear political project that is grappling with the general problems that I have just outlined: how to manage the US’s relative decline within the context of the bigger systemic crises that confront global capitalism?
If you follow the discussions among his economic advisors there is strong evidence of this. A particularly revealing example is a lengthy analysis written in November 2024 by Stephen Miran, an economist who was just confirmed as chair of Trump’s Council of Economic Advisors. Miran argues that the US economy has shrunk relative to global GDP over the past few decades, yet the US carries the cost of maintaining the world’s “defence umbrella” in the face of growing inter-state rivalries. Crucially, he says the US dollar is overvalued due to its role as the international reserve currency, and this has eroded US manufacturing capacity.
He proposes to address this problem by using the threat of tariffs to compel US allies to shoulder a greater share of the costs of empire. Miran says this will help bring back manufacturing to the US (an important consideration in the event of war). He proposes a range of measures to limit the inflationary impacts of this plan and maintain the US dollar as the dominant currency despite the hoped-for devaluation (he explicitly points to the US dollar’s importance to project and secure US power). This kind of perspective is being pushed by the Trump administration, including Treasury Secretary Scott Bessent.
The key point is not whether this plan works or whether it makes economic sense, but to understand the motivations behind it. It is explicitly conceived as a means to deal with the problems facing US and global capitalism, and to reassert US global primacy through displacing its costs onto other parts of the world. The Joe Biden administration proposed different solutions, but it grappled with the same issues, speaking openly of intensifying “strategic competition” and the need to find ways for the US to “sustain its core advantages in geopolitical competition”.
So, we must approach the Trump administration as actors with a coherent project. Obviously there are a whole lot of internal contradictions and tensions generated by this project, and clear disagreements from some sections of US capital and longstanding foreign allies. But these tensions are also a reflection of the highly unstable nature of global capitalism at the moment.
The project’s domestic articulation, as is often the case in times of crisis, is built on scapegoating, virulent racism and anti-migrant attitudes, anti-scientific irrationalism, climate denial, and ultra-conservative gender and sexuality politics. All these kinds of ideological tropes serve to promote nationalism, militarism and a sense of a country under siege. They enable yet more state repression and cuts to social spending. Of course, this is not limited to the US. The global resurgence of these far-right ideologies is further indication that we are dealing with a bigger systemic crisis that all capitalist states are grappling with.
I want to emphasise again the climate emergency. We can see the ways the Trump administration is tearing up environmental regulations and seeking to accelerate domestic oil and gas production as one way to reassert the power of US capitalism (through lowering energy costs). But it is also very clear that we are entering a phase of cascading and unpredictable climate collapse, which will materially impact billions of people in the coming decades. The right might deny the reality of climate change, but that is ultimately because capitalism cannot let anything impact accumulation. We need to centre the climate question in our politics today, as it will increasingly run through everything.
Various competing explanations have been offered to explain US/Western imperialist support for Israel’s war on Gaza. What is your view? How does the process of normalisation between Israel and Arab nations fit into this? And what impact has October 7 and the Gaza genocide had on this?
We should view the US-Israel relationship within the context of the wider region, and not simply through the lens of what is going on inside the borders of Palestine or the motivations of individual Israeli leaders. This requires foregrounding US imperialism and the centrality of the region to global fossil capitalism.
The rise of the US as the dominant capitalist power was closely connected to the shift to oil as the leading fossil fuel in the mid-20th century. This gave the Middle East — as the centre of world oil exports and a crucial zone of energy production — a very important role in the US’ global project. Within the Middle East, Israel has been a key pillar of US influence, especially after the 1967 [Arab-Israeli] war, where it demonstrated its ability to defeat Arab nationalist movements and anti-colonial struggles. In this sense, the US has always been in the driving seat of this relationship — not Israel, and certainly not an Israel lobby.
The other pillar of US power in the Middle East has been the Gulf states, in particular Saudi Arabia. Since the mid-20th century, the US has built a privileged relationship with the Gulf monarchies, acting as a backstop to their survival so long as they remained within the US’ wider system of regional alliances. This meant guaranteeing the flow of oil into the world market and ensuring oil was never used as a “weapon”. It also meant the trillions of dollars earned by the Gulf states through oil sales were largely recirculated into Western financial markets.
But, as with its global status, US dominance in the region has eroded over the past two decades. This is reflected in the growing role of other foreign states in the region (such as China and Russia), and the struggle of regional powers to expand their influence (for example Iran, Turkey, Saudi Arabia and the United Arab Emirates). Importantly, there has also been an eastward shift in the Gulf’s oil and gas exports, which now flow predominantly to China and East Asia, rather than to Western countries.
In response, the US has sought to draw together its two key regional allies by normalising political, economic and diplomatic relationships between the Gulf states and Israel. This project dates back several decades but intensified under the Oslo Accords in the ’90s. More recently, we saw Israel normalise relations with the UAE and Bahrain through the 2020 Abraham Accords. That year, Israel also normalised relations with Sudan and Morocco. These significant steps were followed in 2022 by the signing of a free trade agreement between the UAE and Israel.
We need to read Israel’s actions and the genocide in Gaza through this lens. Even now, in the aftermath of October 7 and the genocide, and amid talk of further expelling Palestinians from their land, the US’ goal remains the normalisation of ties between Israel and the Gulf states as a means to reassert its primacy in the region.
Surely though Trump’s proposal to ethnically cleanse Gaza makes it harder for governments in the region to normalise relations with Israel?
Trump’s proposals for the further ethnic cleansing of Gaza clearly resonate with much of the Israeli political spectrum. There are, however, many obstacles to this, starting with the fact that states such as Jordan and Egypt do not want to see such large numbers of Palestinian refugees displaced into their territories.
But countries such as Saudi Arabia, Jordan and Egypt are not on a fundamentally different page to the US’ project. In principle, the Saudi monarchy has no problem normalising relations with Israel, and they surely gave the green light for the UAE to do so as part of the Abraham Accords. There is an extremely close alignment between the US and the Gulf states, which is accelerating under Trump. We can see this by the fact that Saudi Arabia is hosting the current US-Russia negotiations, and in the recent UAE announcement that it plans to invest US$1.4 trillion in the US over the next decade.
At the same time, it is obviously very difficult for this project to move forward without the defeat of Palestinians in Gaza and elsewhere, and some kind of Palestinian acquiescence. The potential solution to this dilemma is found in the West Bank, in the form of the Palestinian Authority (PA). The PA is key because it has created a layer of Palestinian politicians and a Palestinian capitalist class whose interests are tied to accommodation with Israel and who are willing to facilitate regional normalisation (that was the whole point of the Oslo Accords). So, we should not read the Arab states as somehow being genetically opposed to ethnic cleansing and normalisation in the way Trump proposes.
National oil monopolies run by Middle Eastern states (and other non-Western countries) have overtaken Western corporations in the global oil market. How does this influence the Middle East's position within global capitalism?
Over the past two decades we have seen the rise of big national oil companies, which is shifting global oil industry dynamics. The Gulf states stand out in this respect, particularly Saudi Aramco, the biggest oil producer and exporter in the world today, surpassing the big Western companies that dominated the industry for most of the 20th century.
These national oil companies have followed the Western oil supermajors in becoming vertically integrated. In the ’70s, oil-producing states such as Saudi Arabia focused largely on the extraction of upstream crude oil. But today, their national oil companies are active along the whole value chain. They are involved in refining and producing petrochemicals and plastic. They own shipping lines, pipelines, tankers and service stations where fuels are sold. They have global marketing networks.
At the same time, we have seen the emergence of what I call in Crude Capitalism, “the East-East hydrocarbon axis”. With the rise of China, Gulf oil exports have turned away from Western Europe and the US, and eastwards towards China and East Asia more broadly. We are not just talking about the export of crude oil, but also refined products and petrochemicals. This has led to growing interdependencies between these two regions, which are now the central axis of the global oil industry outside of the US.
That is not to say Western markets and oil firms are not important. Big Western supermajors still dominate within the US and wider North American bloc. But we are left with a fragmented global oil market, in which these East-East connections further reflect weakening US influence — globally and in the Middle East.
What does this tell us about the idea that some transnational or non-Western state-owned enterprises can operate successfully without an institutional anchorage in an imperialist power?
These are not US or Western-owned firms, but they still have important links with Western oil companies (including through joint projects) and are active in Western markets. The biggest oil refinery in the US is Saudi-owned. So, we should not necessarily pit one against the other, as if there is a fundamental difference in how they, as a fossil bloc, see the future of the industry. They absolutely stand on the same side in terms of the climate emergency. We can see this in the prominent role of the Gulf states in obstructing and diverting any effective global response to this emergency.
As well as deepening ties with China, Gulf states have increasingly demonstrated their willingness to act autonomously and even compete for influence in the region. How do you explain the role of these Gulf states?
Associated with this relative weakening of US power, other actors, including the Gulf states, have sought to project their own regional interests.
They have used a variety of mechanisms: sponsoring different armed groups or political movements or hosting different political forces (the case of Qatar stands out here); providing financial aid to states such as Egypt and Libya; military intervention in places such as Yemen and Sudan; and by controlling ports and logistics routes. In these ways, the Gulf states have sought to increase their regional footprint.
This partly has to do with the aftermath of the 2011 Arab uprisings, which rapidly spread across the region, destabilising long-standing authoritarian rulers, such as in Egypt and Tunisia. The Gulf states played a major role in trying to reconstitute these authoritarian states in the wake of the uprisings.
There are also rivalries between Gulf states, particularly Saudi Arabia and Qatar, but also between Saudi Arabia and the UAE. They do not necessarily see eye to eye on everything, and sometimes support opposing sides — for example in Sudan [where Saudi Arabia backs the Sudanese Armed Forces in the ongoing civil war, while the UAE assists the Rapid Support Forces].
However, despite its relative decline, the US remains the major imperialist power in the region. This is evident through its direct military presence in the Gulf, where the US has military facilities and bases in countries such as Bahrain, Saudi Arabia and the UAE. The US is still the final backstop — militarily and politically — for the Gulf regimes.
The term subimperialist is sometimes used to describe countries such as these, which are both subordinate to an imperialist power but operate with some autonomy in their sphere of influence. Do you see this as a useful term for understanding the Gulf states?
While the term subimperialism can capture some of what these states represent, the Gulf states do not necessarily have the ability to project their military strength in the same way that Western powers do. That is not to say that they are not building up military capacity, but they still largely operate through proxies and rely heavily on a US military umbrella. As I mentioned, there are US military bases all over the Gulf. Military hardware exports from Western states to the region furthers Western oversight of the Gulf’s militaries, because these exports require continuous training, maintenance and support.
That said, the export of capital from the Gulf into the wider region — and increasingly also the African continent — is very evident. These exports of capital reflect cross-border transfers of value. It is also very clear that Gulf-based conglomerates have been major beneficiaries of the neoliberal wave that swept the Middle East during the past few decades, in which economies were opened, and land and other assets privatised. I am not just talking about state-owned Gulf conglomerates, but big private conglomerates. If you look across the region at sectors such as banking, retail, agribusiness, you will see both state and private Gulf-based conglomerates.
This is why it is so important to think about the region in the context of capitalist interests and patterns of capital accumulation, not just inter-state conflict.
Iran is sometimes considered to be a small or subimperialist power, given its simultaneous conflict with US imperialism and expanded role within the region. Others see it as spearheading an anti-imperialist “Axis of Resistance” in the region. How do you view Iran’s role?
The term “Axis of Resistance” is misleading as it implies too much unanimity between a quite heterogeneous set of actors with different interests, social bases and relationships to politics, both domestically and regionally. It basically seeks to place a plus sign where [former US president George W Bush] put a negative sign with his “Axis of Evil”. It is a simplistic way of doing politics.
We need to clearly and unequivocally oppose any kind of Western imperialist intervention in Iran or the wider region (whether that be directly, or through Israel). That means not just military intervention but economic and other forms of intervention. Sanctions are a big one in the case of Iran.
At the same time, we should recognise that Iran is a capitalist state, with its own capitalist class, which has its own objectives in the region and more broadly. Much like the Gulf states, Iran tries to project its regional power, amid this context of post-2011 destabilisation, relative weakening of US power and everything else we have discussed.
It is true that Iran does so sitting outside the US’ project for the region, as it has for decades. But recognising the capitalist character of the Iranian state means we must also stand in solidarity with progressive social and political movements in Iran, whether they be workers’ and trade union struggles (of which there continue to be many), women’s struggles, the struggles of the Kurdish people, and so on. These are movements that we, as socialists, should stand with, in the framework of anti-imperialist politics.
The starting point is to be consistently anti-capitalist in how we think about states and movements, which means giving no political support to capitalist governments — whoever they might be, wherever they might be. We can be in solidarity with people in struggle while also opposing imperialist intervention in all its forms, and not reducing the complexities of capitalism in the Middle East to some kind of Manichean geopolitics.