Category Archives: U.S. oil

Watch: Falling Oil Price & Geopolitics – Saudis & OPEC, Russia, USA, .. | My Real News Network interview

A wide-ranging interview on the “perfect storm” of low prices from low demand plus rising production, the Saudi market strategy and some geopolitical implications.

Aside

Last week, I was quoted in the Wall Street Journal on why Petróleos de Venezuela SA (PDVSA) is looking to sell its Citgo refining affiliate in the USA. The key motivation, in my estimation, is to finance projects critical to … Continue reading

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My talk on Iran, NYC | After an Iran-USA deal: A Mideast without democracy, run by Iran & Saudi Arabia?

Figure 1.  Ayatollah Hashemi Rafsanjani (R) exchanges greetings with the new Saudi Arabian ambassador to Iran, Abdulrahman Bin Groman Shahri in Tehran, April 22, 2014. (photo by Twitter/ISNA)    Read more: http://www.al-monitor.com/pulse/originals/2014/04/rafsanjani-saudi-ambassador-kiss-controversy.html#ixzz32ktJuoKR

Kiss between Rafsanjani and Saudi ambassador stirs controversy   Former Iranian President, Ayatollah Hashemi Rafsanjani (R) exchanges greetings with the new Saudi Arabian ambassador to Iran, Abdulrahman Bin Groman Shahri in Tehran, Al Monitor, April 22, 2014. (photo by Twitter/ISNA)

Appreciation: I am honored to again be invited by my Iranian colleagues in New York, Professors Reza Ghorashi, Hamidah Zangeneh and Hamid Sedghi, to join this panel and discuss the geopolitics of US-Iranian relations.  And, my thanks to Prof. Sedghi for reading my paper as I am teaching in Berlin and cannot be with you today. I only ask that those who dislike my message, kindly refrain from shooting the messenger.

Introduction

The US-Iran nuclear confrontation finally appears close to resolution.  This is because both Presidents Obama and Rouhani desire a diplomatic solution, and both countries need to move on. With such an agreement, it is possible that relations will slowly become normalized.

Of particular note—as a direct consequence—are the recent secret negotiations between Iran and Saudi Arabia towards a rapprochement.  These were initially facilitated by Oman (e.g. see reports here, here, and here). Until very recently the Saudis had remained fiercely opposed to any US deal with Iran.  However, the Saudi’s are realists, and know when it is time to adapt.  Figure 1. is a photo of kisses exchanged on 22 April between ex-President Rafsanjani of Iran and King Abdullah’s ambassador to Iran, which caused quite a stir in the region. Agreements reached in these recently revealed negotiations have already significantly affected the presidential-succession crisis in Lebanon, sectarian conflicts in Iraq, and the conflict in Yemen. Next the two sides are expected to negotiate regarding their interests in the Syrian conflict.

In addition, the nature of the US-Saudi relationship is changing, transferring much more responsibility on the Kingdom and its Gulf partners for their own defense–albeit strongly supported with US weapons and logistics. This is part of the US disengagement from direct regional interventions, which will be significantly furthered by a successful US-Iran agreement (e.g., see here and here, and this report on Saudi defense buildup from Balfour at Harvard).

How are these new developments to be understood? Continue reading

USA Oil Seminar 5.0 | USA as Rising Energy Superpower?

us_air_force_jets_oil_buring_iraqNote: These “USA Oil Seminar” posts are extra readings for my students to better understand how US energy policy is developed and to hear the views of US experts.  The seminar is: “The Global Oil System & US Policy” at JFK Institute of FU-Berlin. 

RECOMMENDATIONS:

  1. This Friday, watch live (or the recording later on): Is the U.S. a Rising Energy Superpower? Implications for Global Markets and Asia, the Middle East, Russia, and Europe.  CSIS upcoming talk by Fereidun Fesharaki.  FRIDAY, MAY 16, 2014 | 10:00 AM – 11:30 AM .  Moderated by David Pumphrey.
  2. Read the paper: Fueling a New Order? The New Geopolitical and Security Consequences of Energy |April 15, 2014. By: Bruce Jones, David Steven and Emily O’Brien.  Brookings Institute; Washington, DC.

BACKGROUND:  This week, the class reading assignments are a couple conference papers I wrote a few years ago on the history and structure of today’s global oil system, and how it grew to replace the neo-colonial oil system. Continue reading

USA Oil 3.0 | US energy experts on Europe, Russia & Ukraine

Note: I’m teaching a post-graduate course “The Global Oil System & US Policy” at JFK Institute of Freie U. in Berlin. In order to give students a feel for how US energy policy is developed–and to see the views of important US actors–I’m sending them frequent e-mails with supplemental readings and videos  from US think tanks, US government offices and from the US media on energy topics.

These are not my own in-depth analysis like I usually post on GlobalBarrel.com.  However I think they are worthwhile sharing with especially non-USA followers of my blog.  I’ll title these posts “USA OIL” plus a number to label them).  I hope these are useful.  Here’s today’s ‘optional material’ I sent to my students:

How is US energy policy developed? You might find this video of interest.

Some background: The CSIS (Center for Study of International Security) is a non-partisan (i.e., not Democratic or Republican) think tank in Washington, DC. It performs an important role in US foreign policy. Continue reading

My DGAP article | Energiewende vs. USA Shale Gas: Can German industry compete?

ImageIn Germany, the impact of the country’s renewable energy transition on the economy is a very hot topic.  Tuesday, Mrs. Merkel’s  new Minister of Economy & Environment (and chair of the Social Democratic Party), Mr. Sigmar Gabriel, declared: “We need to keep in mind that the whole economic future of our country is riding on this,” (NYT, 21Jan14).

Here’ is my article in the DGAP’s (German Council on Foreign Affairs’) IP Journal of 30Dec13  (submitted 24Nov13):

Germany’s Energiewende (renewable-energy transition) is under intense pressure both from consumers facing soaring electric bills and from German manufacturers fretting about their falling energy competitiveness vís-a-vís the US, where manufacturers are benefiting from the boom in cheap natural gas production. What should be done to address these concerns has become a major topic of the CDU-SPD negotiations forming Chancellor Merkel’s new coalition government.  

From the viewpoint of German manufacturers, there are two ways the US shale gas revolution implies a worrisome competitive challenge. First, cheaper natural gas in the US is lowering electricity and other energy costs for American manufacturers, while Germany’s continue to rise. This is especially of concern to energy-intensive industries, where the EU now has 36 percent of world capacity and the US only 10 percent. Secondly, as the US begins to build facilities for export of liquefied gas (LNG), this capacity could have a significant effect on the price of electricity and gas in Asia. … Continue reading at DGAP’s (Deutsche Gesellschaft für Auswärtige Politik e.V.) IP Journal.

China y América Latina: ¿Quién gana y quién pierde? – Petroguía 2014 (Spanish)

Inversiones energéticos de  China en Latino américa.  Nota que Venezuela está en tercer lugar, en contra de las intenciones iniciales de Beijing en 2007-08.

Inversiones energéticos de China en Latino américa. Nota que Venezuela está en cuatro lugar, en contra de las intenciones iniciales de Beijíng en 2007-08. HAZ CLICK para magnificar. (Grafico por T.O’D.)

[English readers: This post is an analysis I did in Spanish for Petroguía 2014 – the annual hard-copy guide for the LatAm petroleum sector – of China’s oil and gas investments in LatAm and the Carribean.  For Beijing’s other investments, or a presentation, etc. drop me a line. ]

NOTA: La siguiente es mi análisis publicado en Petroguía 2014, la guía anual para el sector petrolífero latinoamericano.  Soy agradecido a los directores del Petroguía por haberme permitido publicar el artículo aquí.  El artículo es una resumen de una investigación que hizo sobre todas las inversiones de China en Latino américa. Si tienen interés en una reportaje o presentación detallada, por favor contactarme.

China y América Latina: ¿Quién gana y quién pierde?

Sumario. El mercado de hidrocarburos ya no está en el norte de América sino hacia el este,  y la mejor estrategia de intercambio con esa plaza la lleva Brasil, mientras que Venezuela y Argentina están a la zaga.

Por Thomas W. O’Donnell

El petróleo y el gas que exportará América Latina en las décadas venideras irán mayormente a China y otras partes de Asia. Y eso es por el efecto combinado de menores necesidades de energía importada en Estados Unidos, gracias a la utilización de los nuevos métodos de fractura hidráulica (fracking) que produce cada vez más petróleo liviano, y por el tope que ha alcanzado su demanda doméstica. Continue reading