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7/21/08 It’s Not the Axis of Evil — It’s the Axis of Energy |
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By Peter Forman
Global conspiracies are hard to stomach and believe, but there is clear evidence of an alignment around energy interests. This alignment tends to be anti-United States for a few reasons: 1) we are the largest consumer of oil and gas in the world, so buyer and seller have competing interests (on price and control); 2) the energy exporters often have political, economic, and cultural values that are diametrically opposed to the U.S.'s (and we tend to oppose these countries); and 3) some of these countries are highly competitive with us for what seems to be a world of scarcer fossil fuels (think China).
OPEC was the original Axis of Energy. Today, when oil demand is higher than ever and it is, more than ever, a seller's market, the Axis includes many non-OPEC countries.
This Axis of Energy is composed of two types of countries: ones in which net energy exports are a dominant portion of their economy, and a select group of energy consumers who put their energy needs above many other geo-political and cultural values.
This Axis is increasingly aligning itself against the West and, in particular, against classically American interests. Along the way, they are increasingly bending the will of the energy-importing nations. The leading energy-exporting nations are as shown on accompanying chart (below).
With the exception of Norway, all of these countries' economies are net energy-export dominant.
Russia: As we covered recently, Russia is clearly moving forward on using the control and supply of energy as a weapon of geopolitical and military policy. Russia does not wield this weapon alone.
Iran, which has already shown its willingness to use its oil and gas supplies for geopolitical leverage, has now inked a deal with Gazprom, the Russian state-controlled energy company, to develop its oil and gas fields in exchange for control and influence over distribution of that energy — the Axis grows.
Further extending the Axis of Energy, Russia has now proposed the natural gas equivalent to OPEC (which is an oil cartel). Gazprom's CEO, Alexei Miller has proposed this new club of energy-exporting nations as a "permanently acting international organization." The Axis extends.
Russia has been buying up other countries' oil and natural gas supplies to extend this Axis. Libya, which had been moving in a pro-West direction and which is now free from U.S. sanctions, has begun to threaten to use its oil as a weapon. And it is considering materially expanding the Axis with a deal in which Russia would purchase all of its additional oil and gas capacity.
In Latin America, the Axis extends. Venezuela is attempting to consolidate oil control in Central and South America, and its President, Hugo Chavez, has called on the U.S. to stop threatening Iran -- for the good of oil. Brazil, which is also gaining power as a serious energy exporter, may be turning from American interests as well. Consuming countries are also increasingly part of the Axis. Not only China, but also India, the other largest growing consumer of energy, is discussing allowing an Iranian pipeline to feed it directly. China is unabashed in allowing its energy demands dictate its foreign policy and is developing geopolitical energy tentacles throughout East-Asia, including Kazakhstan. Analysts are concerned that Europe's extreme dependence on this Axis of Energy might force it to shift its foreign policy further from U.S. interests.
The United States must recognize the global reorganization of political and energy/military power and move to overwhelmingly reduce its dependence on natural gas and, more importantly, to move beyond oil. |
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