Russia Key in U.S. Push for Mideast Alternative
themoscowtimes.com
By Andrew Mitchell
Reuters OSAKA, Japan -- As fears of a war in Iraq deepen unease over U.S. reliance on Middle East oil, Washington is mounting an energy diplomacy campaign to secure new supplies in Africa, the former Soviet Union and North America.
U.S. Energy Secretary Spencer Abraham last week stopped off in Azerbaijan, the site of multibillion-dollar exploration plays by U.S. oil giants. U.S. Secretary of State Colin Powell toured West African oil states Angola and Gabon earlier this month to strengthen ties. And Energy Minister Igor Yusufov will visit the United States early next month to showcase the two countries' emerging energy links.
It is a drive aimed at protecting the world's biggest oil consumer from the kind of Middle East-propelled oil price surge that is once more threatening to sap global economic health.
Diversification of energy security is a central issue at the three-day International Energy Forum in Osaka, which started Saturday, gathering some 60 oil producing and consuming nations.
Yet all the fuss over U.S. forays into emerging oil provinces such as the Caspian Sea region cannot mask the implacable fact that most of the world's crude is in Middle East territory, wedding the United States to the region for decades to come.
"There's a drumbeat of PR going on that effectively says now we've cut a deal with Russia we don't need Saudi Arabia anymore," said Matthew Simmons of investment firm Simmons and Co. in Houston. "Wake up! Don't dream about something that's the life support of our society. We don't have a diverse energy supply."
Oil supply security has jumped to the top of the U.S. political agenda since the September 2001 attacks on New York and Washington dealt a blow to relations between the United States and leading world exporter Saudi Arabia.
The United States already imports more than half its 20 million barrels of daily oil needs, a dependence that will rise beyond 60 percent by 2020, according to the U.S. Energy Department.
The Middle East Gulf, which holds two-thirds of world oil reserves and almost all its spare production capacity, will by then provide a quarter of U.S. oil imports -- some 5 million barrels daily, the DOE expects.
By contrast West Africa and the former Soviet Union combined are expected to send just 1.3 million barrels daily to U.S. shores by 2020, just 100,000 bpd more than now.
"Every little bit helps. The Russia thing is very charming, makes great headlines, but at some point, the oil is still in the Gulf," said Sarah Emerson of Energy Security Analysis in Boston.
Middle East-dominated oil cartel OPEC has further tightened importers' nerves by cutting production to the lowest level in a decade this year to buttress oil prices. Fears that military conflict in Iraq could disrupt supplies from the Middle East has only added fuel to the fire, pushing prices up to the $30 a barrel mark that economists say spells danger for industrialized nations.
Rather than seeking to contain ravenous U.S. demand for fossil fuels -- more than a quarter of all world oil is consumed in the United States -- the Bush administration has committed itself to developing new oil and gas sources. The main initiative has been with Russia, which this year sent its first tanker of oil to the United States for decades and will early next month present plans for construction of a new export terminal big enough to handle transatlantic supertankers.
"We've had a couple of big successes. One is the dialogue with Russia -- talking to Russian companies about making investments here, buying storage here, so that's been fairly successful," said Amy Jaffe of the Baker Institute for Public Policy.
Next door in the former Soviet Union, U.S. oil majors such as ExxonMobil and ChevronTexaco have labored to open up oil export routes from the landlocked Caspian Sea states Azerbaijan and Kazakhstan.
But the sheer scale of Middle East reserves -- easier to extract, and longer lasting than rivals -- means that it will inevitably provide a growing share of the world's fuel needs in decades to come. |
