MER 271: Fuel and Water: The Coming Crises

by The Editors | published July 18, 2014 - 3:28pm

For immediate release July 18, 2014                           Middle East Report 271   Summer 2014

FUEL AND WATER: THE COMING CRISES

Matthew Huber, Lifeblood

by Chris Toensing
published in MER271

Matthew Huber, Lifeblood: Oil, Freedom and the Forces of Capital (Minneapolis: University of Minnesota Press, 2013).

“The American way of life” -- is there another phrase that sounds so innocuous yet is so fraught? To most Americans, and admirers of the United States abroad, the four words evoke naught but virtue, the “values” of life, liberty and the pursuit of happiness that make the United States the envy of the world, for better and for worse. To critics fond of scare quotes, the term is more likely to mean runaway consumption, particularly as regards car culture, and blissful (or even willful) ignorance of the perils.

"Energy Security"

Genealogy of a Term

by Toby Jones
published in MER271

Over the last few decades, the phrase “energy security” has spread like an oil spot from specialized literature outward into the standard lexicon of reporters and politicians. Like “security” itself, it is a term whose meaning seems transparent but resists precise definition, in part because the meaning is not immediately obvious and in part because the meaning seems to expand as time goes by. What is “energy security”? Why did it become so prominent in discussions of global politics in the late twentieth century and why is it so important today? We asked Toby Jones, associate professor of Middle East history at Rutgers University and an editor of this magazine, to supply some clarity about this concept. Jones is working on a book that will treat this subject in depth.

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China and the Sudans

Wars and Peaces

by Daniel Large
published in MER270

It wasn’t supposed to be like this. South Sudan and Sudan had agreed to share oil revenue, oil was flowing again and, despite considerable problems, relations appeared headed in a slightly better direction. Both governments were drawn to China as a key provider and practical enabler of economic assistance, a political partner and international ally. In early December 2013, South Sudan and China had made progress on negotiations about a package of support to expand a serious non-oil Chinese role. Then, on December 15, the irruption of violence in Juba and its rapid spread to other parts of South Sudan changed everything.

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Recession Hits Saudi Oil Sector

by A Special Correspondent
published in MER120

A visitor to the kingdom might be startled to hear Saudis speak of a “recession” here. Non-oil growth of the gross domestic product (GDP) is proceeding at a 6 percent clip. Unemployment is nil and construction sites still appear to be eating up the desert around every major city. It hardly looks like a recession. Nevertheless, a leaner economic climate is unmistakable. Saudi and foreign contractors alike complain of a slowdown in government payments that leaves them short of cash. The private sector is pruning payrolls and expenses, and layoffs are underway at two of the country’s largest employers, Aramco and the national airline, Saudia. Demand for many key goods and services has stabilized, leaving traders in the lurch.

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Restructuring the World Energy Industry

by Michael Renner
published in MER120

A decade ago, the states that make up the Organization of Petroleum Exporting Countries (OPEC) took a number of important steps to alter the structure of the world oil industry by encroaching on the prerogatives of the international oil companies. The producers unilaterally increased the “posted price” for crude oil and boosted royalty and tax rates. They took over direct ownership of their crude reserves, and created state firms which subsequently took charge of oil operations in many (though not all) producing countries. The monopoly power of the international oil companies was further eroded a few years later when these governments slashed long-term supply contracts and undertook to sell their oil directly to consumer governments and small private traders.

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OPEC's Decade

Has It Made a Difference?

by Michael Tanzer , Stephen Zorn
published in MER120

No one can deny that the past ten years have witnessed great changes in the international oil industry. A decade ago, the seven largest international oil companies -- Exxon, Shell, British Petroleum, Texaco, Standard of California, Mobil and Gulf -- still dominated the industry in virtually every respect. In 1972, these seven companies accounted for three fifths of the non-communist world’s production of crude oil and refined products, and similar shares of transport and marketing as well. Even these figures fail to reflect the relative profitability of these “seven sisters.” They controlled only one third of oil production in the United States, where costs were relatively high and profits correspondingly lower.

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Ten Years After

by Joe Stork
published in MER120

It is still possible, even likely, that history will take note of the remarkable events of late 1973 and early 1974: Egyptian troops crossed the Suez Canal and penetrated the supposedly impregnable Bar Lev line in a matter of hours; the kings and presidents of the Arab oil producing states, led by Faysal of Saudi Arabia, decreed a boycott of the world’s most powerful state; the major Third World oil producers, grouped in the Organization of Petroleum Exporting Countries (OPEC), doubled the price of crude oil in a single afternoon and, a few weeks later, doubled it again. The grievances and frustrations of many generations, it seemed, had finally overturned the old and accustomed hierarchies in cumulative bursts of political energy.

Oil and the Outcome of the Iran-Iraq War

published in MER125

Excerpts from a report by Thomas McNaugher and William Quandt of the Brookings Institution, published on May 14, 1984 by Cambridge Energy Research Associates. These excerpts appeared in Arab Oil and Gas (Paris), June 1, 1984.

Books on Oil Prices

by Michael Renner
published in MER128

Steven A. Schneider, The Oil Price Revolution (Baltimore: Johns Hopkins University Press, 1983).

Robert Sherrill, The Oil Follies of 1970-1980: How the Petroleum Industry Stole the Show (New York: Anchor Press, 1983).

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