If oil is the question, Iraq is not the answer.

Some people say the Iraq crisis has been manufactured to cloak an "oil grab" by the United States and the American oil industry. Others believe that a liberated Iraq will flood the world market with cheap oil and provide a quick fix for concerns about our energy security.

These perspectives, while very different, are based on a fundamental misperception -- of both scale and timing. Yes, Iraq is a major oil country, with the world's second-largest known reserves. But in terms of production capacity, Iraq represents just 3 percent of the world's total. Its oil exports are on the same level as Nigeria's. Even if Iraq doubled its capacity, that could take more than a decade. In the meantime, growth elsewhere would limit Iraq's eventual share to perhaps 5 percent, significant but still in the second tier of oil nations.

But even that scenario assumes that Iraq will welcome foreign investors on a reasonable timetable -- and, history tells us, that is not a foregone conclusion. After the 1991 Persian Gulf War, a liberated and grateful Kuwait announced that it would open its oil industry to foreign investment in order to boost production. Eleven years later, that still hasn't happened, owing to nationalistic opposition in Kuwait's parliament.

While this crisis is focused on overall security -- Iraq's weapons of mass destruction -- there is a clear energy dimension to the confrontation: the security and stability of the Persian Gulf region, from which flows almost a quarter of the world's oil. Saddam Hussein's drive to dominate the region is obvious and cannot be dismissed. He invaded Iran in 1980 and then, a decade later, invaded Kuwait and threatened Saudi Arabia. The other Persian Gulf states have no love for him, and with good reason.

But it requires several leaps of logic -- as well as inattention to developments in the rest of the world's markets, particularly in Russia, the Caspian region and West Africa -- to conclude that the current Iraq crisis is all about oil. No U.S. administration would launch so momentous a campaign just to facilitate a handful of oil development contracts and a moderate increase in supply -- half a decade from now.

How would a Persian Gulf without Saddam affect the future of Iraqi oil? The discussion now under way in Washington and elsewhere -- which takes place under the rubric of "the day after" -- is dominated more by the uncertainties and risks than the benefits. The most immediate question involves a possible war, and the resulting damage that it might do to Iraq's output at the very moment when a new regime would desperately need oil revenues to secure its own stability. There also is much apprehension that Saddam would torch Iraq's oil facilities in a Pyrrhic defeat. That is exactly what Iraqi forces did on their way out of Kuwait in 1991. It took eight months to extinguish the fires in the Kuwaiti oil fields. This time, however, some Iraqi commanders might be loath to obey any such orders, as they would have to answer after the war for their actions.

The next critical issue, when "the day after" arrives, will be the question of authority. Who would be in charge? If there is a temporary military government, either U.N.- or U.S.-led, it would be preoccupied with establishing firm control over Iraq's weaponry and laying the basis as quickly as possible for a new Iraqi government with broad representation. It would certainly be focused on security, including the oil facilities. After all, the country earns the bulk of its living by exporting oil. For that reason, a temporary military authority would be keen to see the "new" Iraq maximize its oil earnings. But a military authority is unlikely to want to get much involved in the decision-making about the future of the industry. Rather, it will try to push the responsibility into the hands of a new Iraqi government -- or an interim group of technocrats.

A new Iraqi government, for its part, will just as surely want to get its hands on its No. 1 economic resource so that it can generate revenue for reconstruction and development. Iraq is not Afghanistan. It has the means, through oil, to pay for rebuilding the country. At the same time, a new government would also be determined to bolster its sovereignty, legitimacy and nationalist credentials -- all of which will be essential requirements for holding the country together. This ensures that Iraq will be a very tough negotiator when it sits down with the oil companies.

It is often assumed in the "it's all about oil" discussions that Iraq would turn over its current 2.8 million barrels per day of production capacity to international companies -- that this is the new "prize" up for grabs. But that's another shaky assumption. If the new Iraqi government brings in foreign companies, it will have to split revenue -- keeping perhaps 88 cents of every dollar of earnings for itself, but with 12 cents or so going to the companies. Why not keep the whole dollar for itself and simply buy what it needs in terms of technology and equipment for the existing fields?

What a post-Saddam government will need is capital -- lots of it -- for exploration and new production from its currently undeveloped fields. And that is where a new regime is likely to turn to international oil companies. But which ones?

It will have no shortage of suitors. Once things are clear, companies will be eager to get in line to sign contracts with a country that has 11 percent of the world's proven reserves. (Saudi Arabia, the highest, has 25 percent; the United States, just 2 percent.) But they will be very cautious when it comes to spending billions of dollars until they are pretty confident about security and stability -- and "stability" applies not only to the new regime but also to the contracts they sign.

Companies from several countries -- Russia, France, Italy and China, among others -- already hold contracts, but they are not operational because of U.N. sanctions still in place. Companies without contracts, including the American ones, will have to assess how much time and trouble they are willing to bear. For the oil companies, the big issue, wherever they operate in the world, is how to manage the range of risks -- from the geological to the political. In response, they often work together in consortia and partnerships. This approach hedges their bets, spreads their investments and diversifies their portfolios.

And that's likely to be the outcome for Iraq. The companies with existing contracts will likely team up with other companies -- American, European, Canadian, Australian, Japanese -- to form new partnerships. Such partnerships would meet the crucial need of a new Iraqi government, which would want to strengthen its position by dealing with a diversified political portfolio of companies representing many different nationalities.

None of this will take place swiftly. It might take a new regime a year or so just to get things organized and begin to negotiate contracts. When it does, it will have to face the deteriorating condition of the Iraqi oil industry. Production capacity has dropped from its peak of 3.5 million barrels a day in 1980, before the Iran-Iraq War, to about 2.8 million barrels per day and falling. Reservoirs have been damaged by years of mismanagement. The infrastructure -- whether wells, pipelines, pumping stations or ports --have no love for him, and with good reason.

But it requires several leaps of logic -- as well as inattention to developments in the rest of the world's markets, particularly in Russia, the Caspian region and West Africa -- to conclude that the current Iraq crisis is all about oil. No U.S. administration would launch so momentous a campaign just to facilitate a handful of oil development contracts and a moderate increase in supply -- half a decade from now.

How would a Persian Gulf without Saddam affect the future of Iraqi oil? The discussion now under way in Washington and elsewhere -- which takes place under the rubric of "the day after" -- is dominated more by the uncertainties and risks than the benefits. The most immediate question involves a possible war, and the resulting damage that it might do to Iraq's output at the very moment when a new regime would desperately need oil revenues to secure its own stability. There also is much apprehension that Saddam would torch Iraq's oil facilities in a Pyrrhic defeat. That is exactly what Iraqi forces did on their way out of Kuwait in 1991. It took eight months to extinguish the fires in the Kuwaiti oil fields. This time, however, some Iraqi commanders might be loath to obey any such orders, as they would have to answer after the war for their actions.

The next critical issue, when "the day after" arrives, will be the question of authority. Who would be in charge? If there is a temporary military government, either U.N.- or U.S.-led, it would be preoccupied with establishing firm control over Iraq's weaponry and laying the basis as quickly as possible for a new Iraqi government with broad representation. It would certainly be focused on security, including the oil facilities. After all, the country earns the bulk of its living by exporting oil. For that reason, a temporary military authority would be keen to see the "new" Iraq maximize its oil earnings. But a military authority is unlikely to want to get much involved in the decision-making about the future of the industry. Rather, it will try to push the responsibility into the hands of a new Iraqi government -- or an interim group of technocrats.

A new Iraqi government, for its part, will just as surely want to get its hands on its No. 1 economic resource so that it can generate revenue for reconstruction and development. Iraq is not Afghanistan. It has the means, through oil, to pay for rebuilding the country. At the same time, a new government would also be determined to bolster its sovereignty, legitimacy and nationalist credentials -- all of which will be essential requirements for holding the country together. This ensures that Iraq will be a very tough negotiator when it sits down with the oil companies.

It is often assumed in the "it's all about oil" discussions that Iraq would turn over its current 2.8 million barrels per day of production capacity to international companies -- that this is the new "prize" up for grabs. But that's another shaky assumption. If the new Iraqi government brings in foreign companies, it will have to split revenue -- keeping perhaps 88 cents of every dollar of earnings for itself, but with 12 cents or so going to the companies. Why not keep the whole dollar for itself and simply buy what it needs in terms of technology and equipment for the existing fields?

What a post-Saddam government will need is capital -- lots of it -- for exploration and new production from its currently undeveloped fields. And that is where a new regime is likely to turn to international oil companies. But which ones?

It will have no shortage of suitors. Once things are clear, companies will be eager to get in line to sign contracts with a country that has 11 percent of the world's proven reserves. (Saudi Arabia, the highest, has 25 percent; the United States, just 2 percent.) But they will be very cautious when it comes to spending billions of dollars until they are pretty confident about security and stability -- and "stability" applies not only to the new regime but also to the contracts they sign.

Companies from several countries -- Russia, France, Italy and China, among others -- already hold contracts, but they are not operational because of U.N. sanctions still in place. Companies without contracts, including the American ones, will have to assess how much time and trouble they are willing to bear. For the oil companies, the big issue, wherever they operate in the world, is how to manage the range of risks -- from the geological to the political. In response, they often work together in consortia and partnerships. This approach hedges their bets, spreads their investments and diversifies their portfolios.

And that's likely to be the outcome for Iraq. The companies with existing contracts will likely team up with other companies -- American, European, Canadian, Australian, Japanese -- to form new partnerships. Such partnerships would meet the crucial need of a new Iraqi government, which would want to strengthen its position by dealing with a diversified political portfolio of companies representing many different nationalities.

None of this will take place swiftly. It might take a new regime a year or so just to get things organized and begin to negotiate contracts. When it does, it will have to face the deteriorating condition of the Iraqi oil industry. Production capacity has dropped from its peak of 3.5 million barrels a day in 1980, before the Iran-Iraq War, to about 2.8 million barrels per day and falling. Reservoirs have been damaged by years of mismanagement. The infrastructure -- whether wells, pipelines, pumping stations or ports -- is in poor shape. Equipment is rusting and malfunctioning. Environmental considerations are widely ignored.

To get back to 3.5 million barrels could take three years or more, at an estimated cost of at least $7 billion. This would put Iraq back into the leagues of Norway, Iran, the United Arab Emirates, Mexico and Venezuela. Another 2 million barrels per day would require a major push, and it would still leave Iraq several rungs below the capacity of the Big Three producers -- Saudi Arabia, the United States and Russia. Making that leap to 5.5 million barrels a day would come sometime after 2010 -- at a cost of upward of $20 billion.

As its output increased, Iraq would begin jostling its neighbors for market share. That would not, however, give Iraq enough clout to be an OPEC-buster. It would not have the ability to "flood" the market. Nor the desire. Its intense need for revenues would make it much more interested in oil at $20 or $25 a barrel, rather than at a cut-rate $10.

By the year 2010, world oil demand, driven by countries such as China and India, could be almost 90 million barrels a day -- 17 percent greater than today. And where will that oil come from? Here's where the picture grows more complex.

One can already see the beginning of a larger contest. On one side are Russia and the Caspian countries, primarily Kazakhstan and Azerbaijan; on the other side, the Middle East, including Iraq. Over the past three years, spurred by what has been called "the miracle in the Russian oil fields," Russian output has increased by about 25 percent, to 8 million barrels a day. The race heated up with the recent announcement by four Russian oil companies of their intention to build a new Arctic port to export directly to the United States.

Right now, Russia and the Caspian nations seem to have the edge in this race. All that, however, is subject to change. The outcome will be determined not only by geology and the balancing of opportunity and risk by companies, but also by political and economic stability and by the decisions governments make.

The current crisis is not even at its denouement. But the prize is very tangible -- by 2010, an additional $100 billion or more a year in oil revenues flowing into national treasuries. After "the day after," Iraq will be in a better position to compete for its share. But it will be only one of several strong contestants.

Yergin, based in Washington, D.C., is author of The Prize: The Epic Quest for Oil, Money, and Power, which won the 1992 Pulitzer Prize for nonfiction. He is co-author of Commanding Heights: The Battle for the World Economy (Touchstone).