Ed: Woods Seminar: The New Geopolitics of Energy

Posted by: Max Dunn on October 9, 2008 17:17:27

The New Geopolitics of Energy

Michael Klare

Woods Energy Seminar

In my Resource Wars class, Klare’s book “Rising Powers, Shrinking Planet” was the main textbook, and Klare is considered to be the guru of resource wars so I was very excited to see him talk

• Michael is a political scientist with background in peace studies

History of Geopolitics

• Geopolitics is when governments step in to manage procurements or export of energy with certain political objectives
• This is sometimes called “Statism”, especially when military means are used for acquiring or protecting energy supplies
• This is not new, before WWI, Winston Churchill was head of royal navy and converted ships from coal to oil. England didn’t have oil but persuaded the British cabinet to nationalize the Persian Oil Company to enable a secure supply of oil
• A critical factor of the US success in WWII was our supplies of oil and the lack of oil in Japan and Germany
• However, with increasing use of oil in the US, external supplies were needed so an imperial role was established with Saudi Arabia where the US would protect the Saud royal family in return for a preferential supply of oil
• This is why several presidents have said that it was important to maintain a presence in the Middle East. This was made manifest in the Carter Doctrine
• Enforced through Central Command that has responsibility for all forces in the Persian Gulf area. Just recently General Patraeus was put in charge of Central Command. Their role is to keep the shipping lanes open, protect the Saud family and keep the supply of oil flowing.
• The invasion of Iraq flows from the Carter Doctrine
• Now this doctrine has been extended to the Caspian Sea and Africa

What’s New With Geopolitics?

• New areas and new resources are now becoming embroiled with geopolitics
• China and India are now key consuming players
• Iran, Iraq, Saudi Arabia and Venezuela have gained control over the price, supply and allocation of their oil.
• Some are providing oil at below-market prices for political gain, like Venezuela to Cuba
• Some oil countries are using oil revenue to buy weapons and using them in ways contrary to our benefit. Venezuela is on an arms buying spree ordering $5B worth of weapons from Russia
• The supplying country’s objective is to extract as much money from us as possible for the longest period of time, and our objective is to get oil at the cheapest rate. This sets our objectives in opposition
• This clash was evidenced by Bush’s begging of Saudi Arabia to produce more oil. We are also clashing with Venezuela
• Russia has now become a petro-power. Putin has re-asserted state control over resource assets and used them in a geopolitical fashion to influence both internal and external issues. Both Putin and Medvedev envision energy as the means for Russia to rise back to power
• US was attempting to bypass Russia by building pipelines through Georgia, and this was a big factor in Russia’s invasion
• China is the second largest consumer of oil and now produces only half of the oil it consumes and by 2030 will produce only 1/3.
• There is doubt whether the oil producing countries will be able to supply enough oil for the developed countries, much less the increased needs of the developing countries.
• The US created a new African Proconsul on October 1, the first time in 24 years which was a historic event and recognizes the Africa is a significant oil supplier and we need a competent military strategy to compete with China in Africa
• US has been courting Georgia for many years to be aligned with us to bypass Russia and has received a huge amount of foreign aid
• Conventional oil supplies will likely not rise further from where they are today by 2012
• Then natural gas will become much more important.
• Geopolitics is important because it will affect all of our lives. Both candidates want to fast track Georgia into NATO. McCain mentioned Ukraine too. This would rope us into defending these countries since Europe won’t.
• Recent military budget is gearing up for a resource war with China in 2030 to 2050.
• If this goes ahead, we won’t have any tax revenues left over for alternative energy since all money will be spent on the military budget.
• Michael supports the people of Georgia but thinks that ensnaring Georgia in NATO is an insane, dangerous path and could lead to WW3

Questions and Answers

• Question: How much power does Russia have to wield a natural gas-sword for political purposes, like it did with the Czech Republic, considering that the sword cuts both ways in depriving the target of natural gas but also reducing Russia’s export income? Answer: Russia has 1/4 of all natural gas and Europe is very dependent on it, so Russia has the upper hand. Russia’s occupation of South Ossetia is only 12 miles or so from the Baku pipeline so Russia could easily take this over
• Estimates that we spend $7B a year defending Middle East oil
• Michael is seeing widespread demand across the country for alternative energy but not agreement on which one
• Worldwide depression would reduce demand for oil although would cause extreme hardship and this might abate the risk over catastrophic war for the time being.
• Fears most a cold war atmosphere that fuels spending on military capacity rather than alternative energies
• Saudi Arabia probably doesn’t have excess capacity but also has one of the highest birthplace in the world so they need more money to subsidize their welfare state to prevent social unrest
• 1/4 of the energy we used is wasted, like with too big cars, so he is in favor of taxes to reduce this waste, like taxes on less efficient vehicles