FYI FWIW:

Steve Kretzmann is campaigns coordinator with the Washington,
D.C.-based Sustainable Energy and Environment Network.

> Oil, security, war: The geopolitics of U.S. energy planning
> Source: Multinational Monitor
> Arrival time: 2003-03-09
>
> THE ROYAL UNITED SERVICES INSTITUTE (RUSI) describes itself as a
> "professional forum for study of defense and international security."
>
> Located in the heart of London, RUSI is an incubator for the latest
> defense establishment thinking. It is no great surprise to enter and
> find Robert "Bud" McFarlane, formerly Ronald Reagan's national
> security adviser, addressing a crowd of officers and bureaucrats.
>
> The surprise last October was his message - greater security for Great
> Britain and the United States will be achieved not by building and
> deploying more aircraft carriers and tanks in the Persian Gulf, but by
> increasing energy efficiency and automobile fuel economy at home.
>
> National security would best be served, McFarlane argued, by focusing
> on reducing domestic demand for oil. Focusing on the supply of oil
> will prove "ultimately inadequate," concluded McFarlane, who once
> worked for the man who removed solar panels from the White House.
>
> This is not your father's clean energy movement. At the symposium
> McFarlane addressed, there was little discussion of climate change or
> other environmental impacts of oil addiction. There was even less
> discussion of the human rights issues that have plagued oil projects
> from Nigeria to Colombia and Burma. The issue for McFarlane and the
> others at RUSI was simply national security.
>
> After discussing various aspects of the costs of oil addiction,
> including the political and economic costs of maintaining security of
> supply, participants in the symposium then argued the case for a
> transition from oil as the principal source of portable fuels.
>
> McFarlane and the RUSI may represent the future of national security
> approaches to energy, but they are not the present.
>
> In fact, the Bush-Cheney administration is perhaps the ultimate
> expression of the "oil equals security" mindset. The administration's
> geopolitical strategy - based in significant part on the threat or
> actual use of force - in large part revolves around the perceived need
> to maintain access to oil reserves, particularly in the Persian Gulf,
> but around the world as well.
>
> BENEATH IT ALL
>
> To understand the politics of oil, it is important to understand both
> the geology and the industry. The world is definitely not running out
> of oil. Over the last 25 years, known reserves of oil have increased
> by almost 70 percent. If all new exploration for oil and gas were to
> stop tomorrow, the wells would not run dry for more than 40 years.
>
> The amount of oil available is not simply a function of geology, but
> also of economics, technology and politics. Identified, or proven,
> reserves refer to oil and gas that have been discovered and remain in
> the ground, but could be extracted quickly and economically using
> today's technology.
>
> Additions to reserves can take place as technological advances allow
> access to previously uneconomical oil, as has happened over the last
> decade with deep offshore technology, horizontal drilling and the
> increased use of advanced seismic mapping technology. Reserves growth
> also occurs during the production process, through the extensions of
> old fields or the discovery of new pools (fields) of petroleum. The
> price of oil or gas also has a significant impact on reserves
> estimates - as price goes up, the higher cost of extraction from
> smaller, more marginal finds becomes more economically viable, and
> those fields are added to proven reserve estimates.
>
> Possible reserves figures, which are cited as an indication of how
> much oil a region might hold for the future, are even more speculative
> - although recent technological improvements have improved the
> reliability of these figures.
>
> To further complicate the matter, both companies and countries have
> financial incentives to either over- or underestimate the amount of
> reserves in their possession at any given time. It is a complicated
> business, and outside the United States, there are no agreed standards
> for reserves calculations.
>
> In The New Economy of Oil, recently published by the Royal Institute
> of International Affairs, the authors put forth the useful concept of
> thinking of all the oil in the world as an iceberg. Visible above the
> water line are those reserves that are proven, and economically viable
> to extract today. Beneath the water are the much more vast reserves of
> conventional and unconventional sources of oil that will become
> economical as the price goes up and the technology evolves.
>
> THE SAUDI ADVANTAGE
>
> But while much of the world's oil may be beneath the metaphorical
> water line, two-thirds of it are in the Persian Gulf As long as the
> world is dependent on oil, it will be dependent on the Persian Gulf.
> Production varies from year to year, as the United States might import
> more oil from Venezuela, Canada or Mexico - but over the long run, it
> is the Persian Gulf nations that are sitting on the motherlode.
>
> And one country, Saudi Arabia, holds just over one quarter of all the
> oil in the world. Saudi Arabia has proven reserves of 264 billion
> barrels of oil, and possible reserves that are estimated by the U.S.
> Energy Information Administration to be as high as one trillion
> barrels. The Saudis have the world's largest production capacity, and
> the largest excess production capacity. On a daily basis, Saudi Arabia
> currently produces 8 million barrels per day.
>
> Perhaps more importantly, it is the only country that can, on short
> notice, produce an additional 2 million barrels a day. This means that
> when disruptions in supply occur - for example, when the Venezuelan
> oil industry shuts down the Saudis are the only ones who can pick up
> the slack.
>
> For these reasons, the oil market revolves around Saudi Arabia. For
> U.S. geopolitical strategists, this dependence on Saudi Arabia is a
> major vulnerability which fundamentally shapes U.S. military policy.
>
> OIL = SECURITY
>
> On October 20, 1973, Saudi Arabia exercised the power it wields based
> on its dominant oil position, declaring an embargo of oil shipments to
> the United States in retaliation for assistance to the Israeli
> military. Other Arab nations quickly joined the embargo. They lifted
> the embargo in March of the next year - but the power of the threat of
> that weapon has shaped U.S. energy and security policy since that > time.
>
> Three years later, President Carter's secretary of defense, Harold
> Brown, testified before Congress that "there is no more serious threat
> to the longterm security of the United States and to its allies than
> that which stems from the growing deficiency of secure and assured
> energy resources.
>
> In January 1980, the lingering fear generated by the embargo, combined
> with events such as the Iranian Revolution and the Soviet invasion of
> Afghanistan, led U.S. strategists to draw a line in the sand.
>
> In his last State of the Union address, Jimmy Carter stated that any
> "attempt by an outside force to gain control of the Persian Gulf
> region will be regarded as an assault on the vital interests of the
> United States," and pledged to defend that interest by "any means
> necessary, including military force."
>
> Five weeks later, the United States Rapid Deployment Joint Task Force
> (RDJTF) was formally established at MacDill Air Force Base in Florida.
> By the time Ronald Reagan took office, the RDJTF included 100,000 Army
> troops, 50,000 Marines, and additional Air Force and Navy personnel.
> In January 1983, the RDJTF became the U.S. Central Command
> (USCENTCOM), which 20 years later is overseeing the buildup of U.S.
> troops around Iraq.
>
> GLOBAL WAR FOR OIL
>
> Two decades after the establishment of USCENTCOM, the U.S. military
> has clearly positioned itself to assert the Carter Doctrine on a
> global scale.
>
> In March 2001, newly appointed Energy Secretary Spencer Abraham
> unveiled the Bush/Cheney administration's process to create a new
> National Energy Strategy "founded on the understanding that diversity
> of supply means security of supply." In actuality, this strategy had
> been in place for more than a decade. Although energy planners know
> that there is simply not enough excess oil in the world to displace
> the central role of the Persian Gulf nations, they have sought to
> maximize sources of oil from elsewhere in order to diminish the power
> of the Gulf states.
>
> President Bush greets troops at Camp Bondsteel in Kosovo.
>
> Alternative oil suppliers immediately become, by definition,
> strategically important in the U.S. military calculus, and there is a
> striking correlation between the presence of oil and the deployment of
> the U.S. military globally.
>
> In Somalia, just before pro-U.S. President Mohamed Siad Barre was
> overthrown in 1991, nearly two-thirds of the country's territory had
> been granted as oil concessions to Conoco, Amoco, Chevron and
> Phillips. Conoco even lent its Mogadishu corporate compound to the
> U.S. embassy a few days before the Marines landed, with the first Bush
> administration's special envoy using it as his temporary headquarters.
>
> The Andean countries of Colombia, Venezuela and Ecuador together
> produce about 20 percent of the oil imported by the United States,
> more than two million barrels a day. Venezuela is often the top
> supplier of oil to the United States. Observers have long suspected
> that the oil in this region was a central motivation for the U.S.
> involvement in Colombia's civil war. In 2002, the Bush Administration
> allocated $98 million to deploy 60 to 100 Special Forces troops to
> train a "Critical Infrastructure Brigade" of Colombians for the
> explic\it purpose of protecting an Occidental Petroleum pipeline.
>
> In the Caspian region, which may contain as much as 200 billion
> barrels in oil reserves, the U.S. military has been actively working
> to combat terrorism - and to secure possible pipeline routes for the
> export of Caspian oil. In March 2001, the United States pledged $4.4
> million in military aid to oil-rich Azerbaijan. Deputy Assistant
> Secretary of Defense Mira Ricardel said the aid was "to counter
> threats such as terrorism, to promote peace and stability in the
> Caucasus, and to develop trade and transport corridors." Azeri
> President Heydar Aliyev more specifically intermingled fighting
> terrorism and protecting oil pipelines, stating, "Guaranteeing the
> security of the Baku-TblisiCeyhan and the Baku-Tblisi-Erzurum oil and
> gas pipelines is an integral part of our struggle against terrorism."
>
> In February 2001, Washington said it would provide the country of
> Georgia with $64 million in military support, and promised to dispatch
> 180 Special Forces "advisers" to train up to 2,000 Georgians in
> anti-terrorism techniques. According to an Interfax News Agency
> report, the Georgian Defense Ministry said that "servicemen trained
> under the U.S. Train and Equip program might help provide security for
> the [Baku-Tblisi-Ceyhan] pipeline."
>
> In 1997, BP and Halliburton (headed at the time by Dick Cheney)
> proposed the Trans-Balkan pipeline (TBP) that would provide another
> export route for Caspian oil via tanker to the Bulgarian Black Sea
> coast and through Skopje in Macedonia to Vlore, a port in Albania. Two
> years later, U.S. forces in southeast Kosovo began construction of
> Camp Bondsteel which has become the largest new military base since
> the Vietnam War. In December 2002, ExxonMobil and Chevron Texaco both
> announced they were considering participation in the Trans-Balkan
> pipeline.
>
> From Nigeria in the North to Angola in the South, West Africa holds in
> excess of 33 billion barrels of proven oil reserves, already supplies
> 15 percent of U.S. oil imports, and could supply one quarter of U.S.
> imports by 2015. In June 2002, a report from the private but
> well-connected "African Oil Policy Initiative Group" recommended that
> the United States declare the Gulf of Guinea a "vital interest," and
> that the United States "should strongly consider the establishment of
> a regional homeport, possibly on the islands of Sao Tome and Principe.
> Fradique de Menezes, the President of Sao Tome and Principe, announced
> in August 2002 that the United States had agreed to build a U.S. naval
> base in his country, though the Pentagon denies any such plans.
>
> IRAQ, OIL, WAR AND SECURITY
>
> If "security of supply" is indeed the Bush-Cheney administration's
> goal, "securing" Iraq's oil goes a long way towards achieving it. Iraq
> holds the world's second largest reserves of oil, 11 percent of the
> world's known reserves. The U.S. Energy Information Administration
> estimates Iraq's possible reserves at 220 billion barrels, or
> approximately 80 percent of current proven Saudi reserves.
>
> One concern in any invasion scenario is that war will lead to a
> temporary reduction in supply, as Iraqi operations go off line. Iraq
> sells approximately 2 million barrels a day on the global market under
> the "Oil for Food" program, and temporary loss of these supplies might
> send oil prices skyrocketing. Three quarters of Iraq's daily
> production comes from just two fields - Kirkuk in the north, and
> Rumaila in the south. Robert Ebel, energy program director at the
> Washington, D.C.-based Center for Strategic & International Studies,
> has suggested that if U.S. Special Forces were to seize these two
> fields in the opening moments of a war, 75 percent of Iraq's oil could
> continue to flow onto a jittery oil market - thus keeping prices from
> spiking too high.
>
> In a post-Saddam Iraq, the country would quickly be in a position to
> dramatically increase production. If sanctions were removed and new
> drilling technology was brought in by U.S. companies, Iraq's
> production could rise from less than 3 million barrels a day currently
> to 6 million or perhaps even 8 million barrels a day by 2010.
>
> If a post-Saddam Iraq's production increases as expected over the next
> decade, Iraq will be an insurance policy against Saudi Arabia.
> Increased Iraqi production will certainly lessen the power of Saudi
> Arabia to manipulate the global oil market, and could even serve as a
> buffer in event of an unexpected loss of Saudi supplies.
>
> U.S. oil companies will almost certainly benefit from a "regime
> change" in Iraq. Ahmed Chalabi, the leader of the Iraqi National
> Congress (the most prominent opposition group), has said that
> "American oil companies will have a big shot" and that he favors the
> creation of a consortium of U.S. oil companies to develop Iraq's oil.
>
> U.S. officials have consistently and vehemently denied that oil is a
> motivation in the buildup to war. On "60 Minutes," Secretary of State
> Donald Rumsfeld was asked if the war was about oil and responded,
> "Nonsense. It just isn't. There are certain things like that, myths
> that are floating around. It has nothing to do with oil, literally
> nothing to do with oil."
>
> But almost no one takes that claim seriously. Whether oil is the most
> important factor in going to war, or merely one of many
> considerations, it is plain that the U.S. obsession with Iraq is due
> in significant part to the country and region's oil reserves.
>
> For Bush and Cheney, national security clearly involves using the
> military to control the global diversity of oil supply needed by the
> world's largest oil consumer, the United States. This view makes sense
> if you believe that there are no viable alternatives to oil.
>
> Thirty years ago, when the oil embargo shocked the United States, or
> 20 years ago, when the Carter Doctrine was just taking hold,
> alternative energy was in its infancy. Today, however, auto companies
> are mass producing hybrid cars, and prototype hydrogen fuel cell
> vehicles are being driven in California. Testifying before Congress
> recently, former CIA Director James Woolsey spoke out strongly in
> favor of alternative energy technology, noting that "there is no
> incompatibility between being a hawk and being a green." While that
> may be true, it is hard to imagine that the U.S. global strategists
> would perceive vital national interest in the Persian Gulf or in a
> half dozen other places around the world if the country were fueled by
> solar power or hydrogen fuel cells. If the energy is limitless, the
> supply will always be secure.

FW

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