Box 17.3: Securing energy

On the eve of World War I, Winston Churchill (then First Lord of the Admiralty in the Liberal Government led by Herbert Asquith) made a historic decision: to shift the power source of the Royal Navy's ships from coal to oil, intending to make the fleet faster than its German counterpart. But the switch also meant that the Royal Navy would now be reliant on insecure oil supplies from Persia (now Iran) rather than coal mined in Wales. Energy security thus became a question of national strategy; and since then it has repeatedly emerged as a significant issue. But what has been the paradigm of energy security since the First World War must be expanded to include many new factors, for energy security is lodged in wider relations among nations and how they interact.

The scale of the problem became evident in 1973-4, when the price of oil suddenly increased fourfold. The main reason was the desire of the Organization of Arab Petroleum Exporting Countries (OAPEC) to punish the West for what was perceived to be their favourable stance towards Israel during the Yom Kippur War (for details see http://en.wikipedia.org/wiki/1973_oil_crisis). In the UK, the short-term effects included the introduction of a three-day working week, the enforced end of television broadcasts at 10.30 pm, and plans to ration petrol. A more lasting result was rampant inflation, and a severe world-wide downturn in economic activity.

Concerns over energy security are not limited to oil. Power blackouts on both the East and West Coasts of the United States (for details see http://news.bbc.co.uk/1/hi/world/americas/3152451.stm), in Europe (for details see http://news.bbc.co.uk/1/hi/world/europe/6121166.stm), and in Russia (for details see http://news.bbc.co.uk/1/hi/world/europe/4582929.stm), and chronic shortages of electric power in China, India, and other developing countries, raise worries about the reliability of supply systems. Rising demand and constrained supplies of natural gas also mean that North America can no longer be self-reliant, and so the US is joining the new global market (see Chapter 20 for economic globalisation) in natural gas linking countries, continents, and prices together in an unprecedented way (see, for example, the ambitious plans of the Russian energy giant Gazprom: http://news.bbc.co.uk/1/hi/business/4531578.stm). The potency of energy supplies as a factor in international relations was underlined in 2005, when Russia threatened to cut off gas supplies to its neighbour, Ukraine (see http://news.bbc.co.uk/1/hi/business/4568288.stm), unless it accepted steep price increases. To many Western observers, it was no accident that in the previous year Ukraine had elected the pro-Western Viktor Yushchenko as President. During that campaign Yushchenko was struck down by a mysterious illness which was subsequently attributed to deliberate poisoning (see http://news.bbc.co.uk/1/hi/world/europe/5040378.stm). It seemed that even if Yushchenko's enemies could not kill him, they might destroy his popular appeal by starving his country of vital energy supplies. A rather different example of the effect of energy supplies is Venezuela, whose controversial leader Hugo Chavez would probably not use such inflammatory rhetoric against the US if his country did not have the largest oil reserves in the Americas (for Chavez see http://news.bbc.co.uk/1/hi/world/americas/3517106.stm). It would not be going too far to say that any country dependent on oil and gas imports must now think twice before picking a quarrel with a major producer. An apparent exception was the widespread opposition to the invasion of Kuwait in 1990, by oil-rich Iraq; but in that case, hostility towards Iraq was mainly prompted by the perceived threat that it posed to other oil producers in the Middle East.

A new range of vulnerabilities has also become evident in recent years. Al Qaeda has threatened to attack 'hinges' of the world's economy – its critical infrastructure – of which energy is a crucial element. The production and distribution of oil and gas offer several points of vulnerability, including pipelines, tankers, and refineries. Even references by terrorist leaders to the desirability for such attacks can trigger sudden increases in energy costs on jittery world markets (see, for example, www.forbes.com/markets/feeds/afx/2005/12/07/afx2374686.html). An even greater threat would be a devastating terrorist attack on a large nuclear power plant (for the US response to this danger see www.nrc.gov/reading-rm/doc-collections/news/2001/01-112.html). If these human threats to energy security were not enough, natural disasters such as hurricanes in the area of key oil installations can have the same effect (see http://news.bbc.co.uk/1/hi/business/4270404.stm).

The world will become increasingly dependent on new energy sources from places where security systems are underdeveloped, such as the oil and natural gas fields off the shore of West Africa and in the Caspian Sea. For the inhabitants of the Niger Delta, in particular, the possession of oil has become a curse, as militia and pirate groups wage an endemic war against the oil corporations and government forces (see www.youtube.com/watch?v=ck2TJTdjJjg; http://en.wikipedia.org/wiki/Conflict_in_the_Niger_Delta) . In a dramatic new development, countries like the US, Russia, Canada, and Norway have become increasingly interested in exploiting the enormous reserves of oil and gas under the Arctic ice. Ironically, the effects of climate change have made the extraction of these supplies more feasible, as the ice rapidly thins. In 2007, the world was astonished to learn that Russian sailors had planted their national flag under the North Pole (see www.independent.co.uk/environment/nature/riches-in-the-arctic-the-new-oil-race-876816.html). Like many feats of exploration, this one had a very direct economic motive. It provoked other countries to start researching their own claims to Arctic territory, amid fears that the relentless quest for energy security was creating a new source of potential conflict. In the meantime, President George W. Bush was pushing hard to extend oil production in Alaska, against the opposition of environmental groups (see www.guardian.co.uk/environment/2008/jun/19/fossilfuels.environment). For such campaigners (see pages 146-50 for details), the fact that the scramble for ever-scarcer fossil fuels is leading to international tensions as well as environmental damage is more than enough to confirm the case for a turn towards renewable sources of energy as a matter of urgency.

Further reading:
Daniel Yergin, 'Ensuring Energy Security', Foreign Affairs, 86 (3) March/April 2006.

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Oxford University Press, Online Resource Centre, Box 17.3: Securing energy.

Box 17.3: Securing energy