Notes,  February 26  Here are some issues -- many treated by one or more of our 'consulting firms' -- which justify at least another half semester of our time!  Too bad that, just as we become somewhat knowledgeable about oil issues, we must turn to water.  (But of course what we're learning is how to get up to speed quickly on issues that are of great policy relevance.)

0.  What's the "petroleum status quo"?  With regard to the US only, see.

1. Tertzakian brings us almost up to date with  regard to patterns of oil production and consumption.  But it doesn't "disaggregate" the trends to examine policies of particular countries or companies, until the last two chapters.  Let's quickly run through some of that data ...

2. Further, the recent rise in oil prices (spot prices varying between USD85 and USD100) push some of the trends way up!  Do we merely compete harder for dwindling (in relation to rising demands, or possibly absolutely, in relation to current production levels) resources?

a. What modalities of conflict will ensue?  Why do we suppose violent solutions will be attempted?  Seizing reserves hasn't solved problems in the past.  Why seize reserves when one can "seize" the petrodollars that they generate?  But this "solution" is not available to small and poor states.

3. Let's look at some issues -- which might potentially become sources of major international disputes -- which Tertzakian's descriptive information raises:

          a. Security of oil transport at sea -- crude petroleum, refined products, LNG

"chokepoints" here.  May any of these be closed by conflicts?  (Recall Suez 1956?)

safety (Recall Deterding designing ships named for sea shells to transport gasoline?)

cost, net of (1) buying security and (2) protecting the environment (Canada objects to US ships.)

b.     Increasing reliance upon coal and upon producing oil from bitumen and shale, both of which generate vast amounts of C02, accelerating global warming

possible water disputes, e.g., between  Canada and U.S.?

transboundary pollution, e.g., "coal haze" and particulates carried across the Sea of Japan and even the Pacific

using coal as a feedstock to produce "synthetic" oil  for consumption by transportation

c.     Increasing reliance upon nuclear power generation

potentially catastrophic transboundary pollution, e.g., Chernobyl fallout

competition for supplies of uranium

problems of security through the entire fuel cycle: enrichment facilities, reprocessing facilities: treatment of "spent" fuel, especially if plutonium is the fuel

nuclear smuggling, "dirty bombs", extortion threats

d.    Increasing reliance upon wind power

applications to transportation require better batteries or other energy storage devices

e.    Increasing reliance upon hydropower, esp. by microhydro (note in Wikepedia's entry there are few citations to working installation)

life cycle benefit/cost analyses usually show dams to be losers; small hydro raises problem of electricity distribution and storage

f.    Increasing reliance upon solar power

at present, solar-generated killwatts are very expensive, and solar electricity shares with hydropower the problems of distribution and storage

terrestial installations require locations with lots of sunshine (never in Syracuse!): can you imaging fighting over desserts in order to "seize" their sunshine.

g.  Pushing ahead with oil!

uncertainties about basic data: how large are today's reserves?  how much oil is left to be discovered (which is relative to technology available)

cost of exploration and discovery in deep oceans and the arctic

can the Arabian peninsula achieve political stability amid vast wealth?

4.  What possible loci of conflict do we foresee?  Where, when, among whom?

a.   Did "cheap oil" motivate in part the US invasion of Iraq?  However economically disastrous this invasion, perhaps other states' governments will similarly be tempted.  Large armored forces aren't necessary, e.g., Australia and East Timor, South China Sea

b.  Must basic institutions which organize world economic and political behaviors be altered?    

concessionary lending by the World Bank (Group) and regional development banks

Law of the Sea, esp. limitations of the EEZ; continental shelf extension; the status of the law is up in the air

the global monetary system of (mostly)  floating national currencies   

the system of sovereign states itself ?!