SPE-ELP Dinner Forum: Energy Geopolitics
Energy has become a strategic factor in global geopolitics. It is a key to national power as well as a major requirement for economic growth.
The use of energy has had a decisive role in the transformation of man from the manual laborer of the old agrarian society. His limited physical capability and stamina and those of his domesticated animals were replaced by the far more efficient and infinitely more potent capabilities of the energy-driven man of today.
There is no question that today, energy consumption has become the most discernible national characteristic that separates rich from poor countries. The United States, the richest nation in the group, with a per capita income of about $35,000, also is one of the most intense users of energy with an annual per capita consumption of about 355 million British thermal units (MMBTU).
The energy use in other developed countries while also well correlated with their wealth is also a function of their geography, the makeup of the countries and even the tastes and preferences of their denizens. China and India, by far the world’s most populous nations languish considerably behind with per capita incomes of $3800 and $1800 and per capita energy consumptions of 25 and 12.3 MMBTU, respectively. There is little question that for these two nations to catch up with the developed world they will have to move up the curve. This may prove perhaps the most formidable international challenge of the twenty first century.
There is a substantial imbalance in the location of energy producers and consumers, an imbalance that has precipitated world conflicts and one that will likely cause future upheavals. Prominent among these areas is the Middle East where five of the six countries with 75 billion barrels of reserves are located. The Straits of Hormuz through which one third of all oil world trade passes is a geopolitical choke point. Other areas such as Venezuela, Nigeria and Indonesia have also caused or are causing difficulties in their ability to deliver oil. Russia’s recent ascendancy in the energy world has been an important counterbalance to the power of OPEC. However, recent events surrounding Russia’s energy industry have exposed fissures within the economic and political makeup of the country.
There are several analysts who have concluded that energy limits should be a "genuine concern" not only for the developed world, but more important, "if the rich/poor gap is finally narrowed." Consider that about 2 billion people (one third of the global population) have no access to energy sources of any kind outside of charcoal, wood and animal dung.
These analysts suggest that the current growth path will likely cause chronic energy shortages as early as 2010 and will evolve into a serious energy crunch later.
One obvious bright spot for the future is that energy consumption in the generation of wealth and the form of primary energy sources have not been constant throughout the last two centuries. Instead, the process has been dynamic, technology has played a considerable role and nations have and wi
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