Rounding out my day of energy policy, I also went to a small lunch event at Cato where Eugene Gholz talked about his paper (with Daryl Press) on “Energy Alarmism: The Myths That Make Americans Worry about Oil”
Many Americans have lost confidence in their country’s “energy security” over the past several years. Because the United States is a net oil importer, and a substantial one at that, concerns about energy security naturally raise foreign policy questions. Some foreign policy analysts fear that dwindling global oil reserves are increasingly concentrated in politically unstable regions, and they call for increased U.S. efforts to stabilize—or, alternatively, democratize—the politically tumultuous oil-producing regions. Others allege that China is pursuing a strategy to “lock up” the world’s remaining oil supplies through long-term purchase agreements and aggressive diplomacy, so they counsel that the United States outmaneuver Beijing in the “geopolitics of oil.” Finally, many analysts suggest that even the “normal” political disruptions that occasionally occur in oil-producing regions (e.g., occasional wars and revolutions) hurt Americans by disrupting supply and creating price spikes. U.S. military forces, those analysts claim, are needed to enhance peace and stability in crucial oil-producing regions, particularly the Persian Gulf. . . .
Our overarching message is simply that market forces, modified by the cartel behavior of OPEC, determine most of the key factors that affect oil supply and prices. The United States does not need to be militarily active or confrontational to allow the oil market to function, to allow oil to get to consumers, or to ensure access in coming decades.
I find this thesis convincing, but I don’t think it really gets to the heart of the matter, which doesn’t have to do with the “stability” of the Persian Gulf as much as it does with the fear that the Gulf’s oil reserves might be politically unified. The US didn’t want Iran to conquer Iraq, the US didn’t want Iraq to conquer Kuwait, and now the US is concerned about a “Shiite crescent.” When I brought this up Gholz indicated that this fear is basically unrealistic. That, in turn, I agree with. Still, the upshot is that the real debate in this regard turns on an empirical point about the actual present-day configuration of the Persian Gulf region rather than a theoretical claim about energy security.
UPDATE: “Basically unrealistic,” I should say, at the moment. Obviously, Saddam Hussein did in fact conquer Kuwait in the not-too-distant past and could quite plausibly have overrun Saudi Arabia had the Saudis not gotten foreign military backing.