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Iraq Now Says It Will Join OPEC Output Cuts

In its third flip-flop position…

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The Wider Ramifications Of The OPEC Deal

The OPEC deal has had…

The Oil Industry And Its Effect On Global Politics

Over the past century, modern society has developed a near unquenchable thirst for oil and after 100 years of searching and experimenting there is still no reliable replacement.

“Oil is Power!” I don’t just mean power as in “energy,” I mean power, as in being a primary factor in the process of asserting and maintaining political dominance and control. Oil is needed to grow food, build infrastructure, advance technology, manufacture goods and transport them to market. It lubricates the mechanisms of both national and international politics. Those who can consistently get their hands on the most oil, at the best prices … will rule!

So what makes oil so highly valuable that individuals, companies and sovereign states would actually be willing to go to war, if necessary, in order to defend or fight to win their “beloved?”

First, “Oil is Universal!” It is a staple of our very existence! Oil plays a major role in practically every aspect of our lives from technology and transportation to the very food and business necessary for our survival.

Second, “Oil is Unique!” While there may be various alternative energy supplies available for some industrial tasks such as creating electricity, there is currently no reasonable substitute for oil when it comes to transportation.

Third, “Oil is Rare!” According to scientific calculations, oil is a progressively depleting fuel that is disappearing at an exponentially alarming rate. While there are still an undetermined number of rich, untapped oil deposits left to be discovered around the globe, reasonable arguments will continue as to just how quickly the world’s oil supply might run out.
However, even amongst the most optimistic and pessimistic prognosticators, there is virtually no debate that there is currently less oil available to us than there was just 50 years ago.

As recently as the year 1900, coal accounted for 55% of the entire world’s energy use while oil and natural gas contributed a mere 3% of the world’s energy. One century later, coal provided only 25% of the planet’s energy, natural gas has risen to 23% and oil reigns supreme at just under 40%.

Back in the year 2000, demand for oil was approximately 75 million barrels per day! Less than ten years later, the IEA (International Energy Agency) now calculates that our global thirst for crude oil will actually “DOUBLE” by the year 2030.

Planes, trains and automobiles, they all rely on oil. Whether it’s driving the kids to school, hauling necessary foodstuff and commodities to market or powering a warship, tank, missile launcher or jet fighter in and out of battle zones, those who have oil prosper and those who don’t … collapse!”

So there is no surprise just how much international, geo-political concern and conflict arise regarding oil and the companies that supply it around the globe. Over the years we’ve witnessed numerous rows being raised on the international scene, some merely escalating into confrontations quelled by “quid pro quo” agreements while others have led to boycotts, United Nations censures and in some cases invasions and all out wars!

Throughout history, there have been numerous, seriously contentious conflicts about oil involving the United States, Russia, The Former Soviet Union (particularly The Ukraine), Turkey, Britain, Germany, Norway, The Netherlands, France, Italy, Japan, Saudi Arabia, Iran, United Arab Emirates, Afghanistan, Kuwait, Iraq, Mexico, Venezuela, Indonesia, Nigeria, Algeria and Libya, just to name a very few of the many sovereign principalities and geographical locations that have found reason to “come to odds” and on occasion, “to arms,” over oil.

Many of the most prosperous countries also tend to be those countries who have made “arrangements” to consistently receive large supplies of life giving oil, at reasonably low oil prices, for an extended period of time. These entities that “HAVE” quite naturally don’t want to go without and will often be willing to use whatever political might they find necessary to protect their position of prominence.

On the other side of the coin, higher oil prices have also served to bring greater political stability and prosperity to several regions around the planet. Some of these locations, including Mexico, Columbia, Venezuela, China, India, several of the Persian Gulf States, Russia, as well as many former Soviet Central Asian Republics and portions of the continent of Africa, particularly Nigeria are just getting their first tastes of “the good life” and are quickly developing a strong liking to the flavor.

For some countries, higher oil prices mean finally having the money needed to invest in desperately outdated infrastructure, technology and means to successfully building a sustainable defense and military that protects the borders and sovereignty of the nation, eliminating many incursions, invasions and all out turf wars before they can ever get started. People who feel safe tend to prefer the sweet fruit of peace!

The old axiom has never been more true” “As flows the oil, so flows prosperity.” Everything from a countries economy and currency exchange rate to their population’s over-all sense of security and political stability seem to hinge precariously on what has come to be known as “Black Liquid Gold!”
The very political success or failure of any ruling regime and the very survival of its citizens is dramatically affected, not simply by the mere possession of oil, but by effectively controlling the price of this all important fuel.

One thing that nearly all governments seem to agree upon is the importance of maintaining stability in both the market and ability of oil to reach those energy thirsty nations that it serves.
Meanwhile, there are strong proponents of various political agendas hoping to alter the landscape of various regions, whether they are agents of Democracy, throwbacks to the days of Socialism and Communism or an ever expanding “Universal Industrialism’ that crosses all borders and nationalities.

No one can possibly know for sure what the future holds, but one thing is absolutely for certain. For the next 50 to 100 years, oil will continue to play a major role in determining the geopolitical make-up of this planet. Whether the international game being played is based on economics as in “Monopoly” or world domination by way of military prowess, such as in “Risk,” the one common factor will be the oil that lubricates the wheels of progress toward prosperity and political power!

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