Category Archives: US Foreign Policy

A Comment on: “A Trans-Atlantic Manifesto in Times of Trump – A German Perspective,” by foreign policy experts

I sent this today to European and American contacts – apologies for duplications.

Dear Colleagues and Friends,

I read with interest the declaration: “In spite of it all, America: A Trans-Atlantic Manifesto in Times of Donald Trump – A German Perspective,” signed by a number of leading German foreign policy experts today in Die Zeit and translated in the NYTimes.
Point 10 is of particular interest and much welcomed as – at long last – a frank characterization in Germany of the Nord Stream 2 project for what it plainly is: “a geopolitical project:”  Quoting:
10. Energy security policy — giving up Nord Stream 2 is in Germany’s interest
There is one more policy area in which the German government should reconsider its position to open the door for productive cooperation: energy security policy. The United States has identified Nord Stream 2, the planned pipeline running through the Baltic Sea to Russia, as a geostrategic project. They are correct. More important: This pipeline project is not in the joint European interest. Nord Stream 2 contradicts a policy of greater energy independence and undermines the envisaged European Energy Union. We should try to identify a joint approach with our European partners and the United States. (emphasis added – T.O’D.)

Further along in the spirit of Trans-Atlanticism, which this manifesto embodies, I should point out that the recent US sanctions bill (enacted by Congress in retaliation for Russian interference in US elections, and to codify into law Obama’s presidential sanctions orders stemming from Russia’s East Ukraine and Crimean interventions, so that Donald Trump cannot easily reverse these) … involved Congress meeting with EU and German diplomats and re-drafting the initial bill so as to take into explicit consideration European concerns.

These concerns were that US sanctions should not unfairly disadvantage European firms over US firms, and should not be imposed on EU firms in a “unilateral” manner, without close consultations with European allies as were carried out by the Obama administration.
In fact, the final version of this bill explicitly requires the Trump Administration to decide to impose any new sanctions on participants in European pipelines or energy projects such as Nord Stream 2 only in “coordination” with the European Union.
The fact that the final drafting of this bill – which Trump was constrained to sign because it was ‘veto proof’ – involved US-EU active cooperation “without and against” President Trump is a significant step in defense of Trans-Atlanticism and in defiance of Trump’s anti-European “America First” policy and of his vision of US “energy independence” as jingoistic “US energy dominance.”
Today’s manifesto by influential German foreign affairs figures advocating further engagement with the USA in spite of (and de facto against) Trump, is a further positive step in this direction.
I should note that the Trump administration has missed the new sanctions bill’s mandated deadline to report to Congress on these issues.  Meanwhile, I am told (some two weeks ago) by reliable sources that “all work has been frozen” by Gazprom’s European-partner firms involved in the NS2 project, awaiting clarity from the White House on what any new sanctions will be and then to understand the longterm impact on their participations.
My recent Berlin Policy Journal article on this, Neue Neue Ostpolitik, and some earlier ones there may be of interest.
Sincerely,
Dr. Thomas W. O’Donnell  ||  Energy & International Affairs
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 – Freie Universität-Berlin …………………………Syllabus: Energizing Europ
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An Oil-Price War´s Surprise Ending -My BPJ article on OPEC, Shale, Trump, Market & Geopolitics

bpj-oil-price-war-end-29nov16Here`s my latest at Berlin Policy Journal:  about  OPEC`s 30 Novermber meeting, US shale and the geopolitics from the  Trump Administration towards Iran and the Saudis. – Tom O`D.

An Oil-Price War’s Surprise Ending

No one expected shale producers to survive extended low oil prices.
, NOVEMBER 29, 2016 
The oil market’s oversupply – and the low prices that followed – was supposed to drive shale producers out of business. Instead, the economies of several large national producers have been upended, and the next act could prove even more destabilizing.

OPEC’s 171st meeting in Vienna on November 30 reflects the new paradigm of the global oil market. After two years, the Saudi-led price war to drive American shale and other “high cost” producers from the market has ended. However, to the surprise of many – not least the Saudis – shale has survived. What now?

The United States Energy Information Agency (EIA) expects persistent market oversupply to have been quenched by the second half of 2017. The Saudis view the diminishing oversupply as an opportunity to cut production by 600,000 or more barrels per day – although about twice this amount would be optimal – boosting prices from under $50 per barrel to $60 or more. The Saudis have worked intensely to reach an agreement at the OPEC summit to coordinate this production cut with Russia; any failure to achieve this highly anticipated deal would sink market confidence, pushing prices into the $30s.

The key obstacle to the Saudi plan is that Iran has refused to participate in any cut, insisting it should first be allowed to re-establish production it lost under years of sanctions. In response, the Saudis have threatened to boost their own production, punishing Iran by collapsing prices and by denying them market share. The Financial Times’ Nick Butler correctly characterizes this as “playing with fire,” and not only because of the severe pain this would impose on weaker OPEC states, but also for the geopolitical retaliation it might provoke from the new US administration as the Saudis would also bankrupt numerous shale producers in the US.

However, even if Russia, Iran, and the rest of OPEC agree to the Saudis’ cuts, US shale is widely expected to expand into the void, re-depressing prices by later next year. In all these scenarios, the future remains extremely difficult for OPEC, for Russia, and for other oil-dependent states.

A Price War Backfires

The prolonged high price of oil, starting to rise in 2002 and then dipping during the financial crisis before rising again till mid-2014, encouraged the emergence of new unconventional shale production. Driven by technical innovations in hydraulic fracturing plus abundant venture capital, by 2014 the US had added more new oil to the global market than what was lost in the Arab Spring and subsequent wars in Libya, Iraq, and Syria. By mid-2014, some two million excess barrels-per-day (bpd) were flowing into storage, and the price collapsed. Continue reading

Post-election reading list: Trump’s foreign policy portends “world crisis”

euroactive-trump5440390625_feab8a9520_zMuch of the USA – and most of the world – were stunned by Donald J. Trump’s victory over Hillary R. Clinton last night.  His campaign was filled with bombastic claims,  but gave little detail on foreign policy.  However, now “the Donald” will be President and Commander-in-Chief of the superpower at the center of the global security system since WWII.  It is time to look at Trump’s foreign policy program and what it means. Below is an initial reading list I am giving to my students today.

An interesting study of Trump’s foreign policy ideas  has been done by Thomas Wright at Brookings Insitute in Washington in recent months. And, this is the first important point to see:  that Trump indeed has serious and deeply held ideas on foreign policy. Wright identifies three main tenants, as he explained in an interview in the Atlantic:

Trump’s isolationist ideology has three components, according to Wright: 1) opposition to U.S. alliances; 2) opposition to free trade; and 3) support for authoritarianism. In Wright’s view, these three beliefs, if translated into policy in a Trump administration, could do away with the liberal international order that the United States helped design after World War II and has led ever since.

Taken together, Wright argues these portend a change to the world order of a magnitude not seen since the pre-War 1930’s, when the Nazi party won elections in Germany and Continue reading