USA Oil Seminar 5.0 | USA as Rising Energy Superpower?

Note: 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. In that old system, the huge, vertically integrated, private, international oil companies called the “Seven Sisters” (plus the French national firm) directly owned Middle-East and Latin-American states’ oil fields as “concessions.”  For decades, they had rather secretively managed global production, distribution and pricing of oil without there being any significant spot or futures market.

The OPEC Revolution–the nationalization of OPEC states’ oil fields in the 1970’s following the Arab-OPEC 1973 oil embargo was the final nail in the coffin of the old system.  At the time, it was not clear to anyone what would develop over the next several years to replace this old system.  A decade of intense confrontation ensued between the OPEC states and the global north, led by Washington.

A major theme of this story is how the USA came to be the predominant actor and self-styled protector of today’s open-market, collective, global oil-security system. This system, in its present form, emerged along with the emergence of a significant level of  market collusion and security cooperation between the OECD and OPEC, especially the faction led by Saudi Arabia, in the later 1980’s and the 1990’s.

In the seminar, we’ve been talking about the new tight (or shale) oil and gas “Revolution” in the USA and what the anticipated “energy independence” will mean for US energy geostrategy.  We’ll also explore how this system is and is not coping and adapting to the enormous presence of China in this now three-or-four-decade-old system.

Some important US-based actors in the debate over what this energy boom means for US geopolitics include Fereidun Fesharaki, David Pumphrey, Bruce Jones, David Steven and Emily O’Brien.  I highly recommend their work: this CSIS event and the Brookings paper.