Great New Fossil Fuel Reserves
World-Changing Oil Exploitation
French and British oil interests in the Middle East started it all, and then, of course, American oil companies entered the picture as well, since the vast riches of petroleum products discovered so readily available in the Arab states of the Persian Gulf, drew the world's premier petroleum refiners to make cozy deals with those states whose rich stores of natural resources the world was becoming increasingly hungry for. And a world backwater, the Middle East, which had until then represented the exotic and the backward, became the wealthy and the powerful.Without oil wealth Saudi Arabia, Qatar, Kuwait, Bahrain, Oman and the United Arab Emirates would still be social, political and geographical backwaters. Saudi Arabia would never have acquired the relationship it had with the United States, a relationship that included the bin Laden family, and the wealthy MidEast sheiks and royalty that now govern might have long since been overthrown by their populations seeking some measure of freedom; yet perhaps not, since Islam offers no measure of freedom to individuals.
On the other hand, it is highly unlikely that the tensions that now exist between the West and the Middle East would have taken quite the trajectory it did. The West would have had little interest in establishing its presence there, and even less in investing so massively in Middle East energy resources, enriching those oil-rich states. A process that has kept its dictators and tyrants in power, able to buy the loyalty of their citizens with the proceeds of oil sales.
Nor would Osama bin Laden have railed against the rape of the Middle East's oil wealth by the West, though he might still have found good reason to instruct his followers that a dedicated jihad was in order because the West was insufficiently respectful of Islam. Arab oil exporters sent Western markets into a tailspin when they made their raw product less available opting for bigger windfalls, causing a shortage and a panic that resulted in the 1970s energy panic.
Reminding the West just how vital that product was to their economies, stimulating greater awareness and 'respect' to come their way. The world learned to walk on oil-eggshells And there were stories being bruited about in the news much more latterly about the impending shortage of unrefined oil, warning that the world would soon run out of fossil fuels, and then, where would we be? This pervasive fear-mongering lasted for decades.
And now, suddenly, discoveries all over the world of vast stores of gas and oil deposits. Perhaps not quite in what were considered to be conventional deposits, but more complicated-to-extract finds. Extractive science has more than adequately risen to the challenge. The United States itself has become the world's largest producer of natural gas, resulting in a glut on the world market, halving the price of natural gas.
And the same thing is materializing in Europe, where major natural gas stores are being revealed in the U.K., France, Poland and Ukraine, meaning that they will very soon no longer be so heavily dependent on Moscow's cranky mood during the miserable, cold winter months. Shale oil and oil extracted from other rock formations, quite a lot of it in the United States, is being revealed, to the extent that the U.S. will shortly be completely oil-and-gas self-sufficient, and an exporter, as well.
Shale oil technology is emerging, but it seems evident that it will eventually be developed to result in fairly inexpensive extraction, comparable in cost to the Alberta oil sands. Israel has roughly 250-billion barrels in one discovered basin alone near Jerusalem, comparable in amount to Saudi Arabia's huge reserves, and it plans to be able to develop its oil at a cost of $35 to $40 a barrel.
With all these petroleum riches showing up the world over, including in China which now imports massively, but will likely eventually become an exporter, since it has the world's second largest store of shale oil waiting to be extracted. Some 38 countries on every continent are estimated to have 4.8-trillion barrels of shale oil which, when extracted, will make that commodity readily available, inexpensively, driving the engine of industry everywhere.
Sounds like pie in the sky, but this is the future of oil production and availability world-wide. How cheaper and more readily available energy will impact on climate and environmental change, and how prepared governments will be to fund newer, cleaner extraction technologies and undertake required environmental remediation, is another vital aspect of the scenario to come.
As for the Middle East and its vaunted reputation as the world's number one oil supplier: Saudi Arabia has its petroleum extraction to thank for 80% of its budget, 90% of its export earnings. A large decrease in revenues due to a diminished demand from its exclusive source will impact markedly on the country. Where tribal antipathies and religious sectarianism remain issues of critical social unrest should the Saudi rulers no longer be able to buy the quiescence of their population.
It remains to be seen in the future whether the opening up of the energy market on a far wider scale to benefit countries that have so long been dependent on the Middle East and who will now be energy sufficient thanks to their own exploited reserves will result in a more balanced, less competitive, and prone-to-conflict world. It's not likely, but it will mark an interesting transition.
Labels: Energy, Environment, Middle East, Political Realities
posted by Pieface @ Monday, April 02, 2012
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