Saturday, November 18, 2006

Third World Countries and the Politics of Oil

I live in Northern California but grew up in Southern California in a suburb on the east side of Los Angeles. My parents still live down there though they moved to the northern part of San Diego county some twenty years ago. Every time I go down to visit them, I am in awe of the development. Many farms, ranches and orchards in Southern California are long gone, buried under urban sprawl, and I've been used to that for some decades. What has astonished me in the last fifteen years is the enormous development in areas that were once sparse desert with very little water. Years ago, on roundabout back roads from Los Angeles to San Diego you could travel ten to twenty miles and see two or three homes now and then surrounded by shrubs and sand and sometimes barren hills (though now and then, you might climb over a hill and find something like a small oasis of a few dozen acres). Today there are areas that were once desert less than thirty years ago that are home now to 200,000 people.

I am in awe of what we as human beings can accomplish, but I admit I have mixed feelings about it all. In one area, many years ago, I used to go camping out in the middle of nowhere, or so I thought, and now there are houses and schools and shopping centers where I used to listen to frogs and watch the stars at night by a campfire.

It's good to know we can accomplish things but it's important to understand that the world has gone from 2.5 billion people when I was born to some 6.5 billion in 2006. There are a lot of people in the world and it's getting harder to develop the resources they need. And it's getting harder to accomplish things without polluting rivers and oceans and the air; it's harder partly because of politics and partly because we haven't been thinking much about the future for some years. Maybe it was because we were all astonished that the Soviet Union collapsed and there was never a nuclear war. Maybe it was because life has become complicated, busy, and there's the mortgage and there's a lot of important things that are done are out of sight or faraway and we just assume somebody is out there thinking about these things. But the truth is not enough people are thinking about the future. It's even gotten to the point where people aren't thinking too much about the here and now.

Nobody likes to talk about it but a number of things in the world are getting ticklish and some of these things are as close as the back door; and we see some of these things when we look at our monthly bills. Energy, for example, is not as plentiful and secure as we were hoping for by now. There's nuclear energy which has a number of unsolved issues—though nuclear plants are still being built in different places around the world. There's technology that never came about that we thought would provide abundant energy by now, such as nuclear fusion. Part of the problem is that research in any number of areas has not been that extensive in recent years. At least not as a percentage, let's say, of the federal budget. And part of the problem goes back to what I said a minute ago: not enough people have been thinking about these things for the past twenty-five years. And frankly, there have been politicians and business executives who have been content to let things be.

Gasoline prices have gone down recently but the fundamental problems are still there. I recently came across an interesting table on the Oil CEO (a larger view of the table can also be found here). The table is not a complete list of every country in the world but it's a sobering view. For example, the table shows that at least 115 countries consume more oil than they produce; these countries have to import oil from a slowly shrinking list of exporting countries. The United States, of course, is one of those countries. In fact, in terms of population, the three largest nations in the world, China, India and the United States are net oil importers along with big consumers like Germany and Japan who are also net importers. The overwhelming majority of oil that's available for export now comes from only two regions: the Middle East and Russia.

Conditons in the world are such that a growing number of nations have no chance of becoming a significant part of the industrialized world. Some poorer countries simply find that they cannot continue their rate of oil consumption and they're cutting back. And we're finding some strange situations where countries are net exporters because they cannot afford to consume their own fuel. The reason can vary. Here's a story by Jane Perlez of The New York Times about Myanmar:
In the balmy waters of the Bay of Bengal, just off the coast, an Asian energy rush is on. Huge pockets of natural gas have been found. China and India are jostling to sign deals. Plans are afoot to spend billions on new ports and pipelines.

Off the coast near Sittwe, new ports and pipelines are planned.

Yet onshore, in towns like this one, not a light is to be seen — not a street lamp, not a glow in a window — as women crouch by the roadside at dawn, sorting by candlelight the vegetables they will sell for two cents a bunch at the morning market.

Paraffin and wood are major sources of light and heat. People receive two hours of electricity a day from a military government that is among the world’s most repressive.

But attempts at outside pressure to prod the government to address its people’s needs and curb abuses have faltered, in large part because China’s thirst for resources has undermined nearly a decade of American economic sanctions.

(snip)

The Asian energy rush is the latest demonstration of how the hunt for oil and gas, and China’s economic leverage, are reshaping international politics, often in ways that run counter to American preferences.

I suppose we've been seeing things like this all along for the past two hundred years by various nations concerning oil as well as other resources, but the intensity and pressures are growing. I suspect in the next five to ten years we're going to see stories even stranger than the one above by other countries in the hunt for oil. It is truly time to pay attention. And to start seriously looking for alternatives.

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