Behind the pay wall at Foreign Affairs is this think piece by Charles L. Glaser and Rosemary A. Kelanic
Getting Out of the Gulf: Oil and U.S. Military Strategy which is really not about
military strategy, but about national strategy for the Persian Gulf. This means tracing our involvement back to President Jimmy Carter:
In January 1980, U.S. President Jimmy Carter used his State of the Union address to announce that in order to protect “the free movement of Middle East oil,” the United States would repel “an attempt by any outside force to gain control of the Persian Gulf.” Carter and his successors made good on that pledge, ramping up U.S. military capabilities in the region and even fighting the Gulf War to prevent Saddam Hussein’s Iraq from dominating the region’s oil supplies. Although Washington has had a number of interests in the Persian Gulf over the years, including preventing nuclear proliferation, fighting terrorism, and spreading democracy, the main rationale for its involvement has always been to keep the oil flowing.
The authors point out that the world has changed since 1980 and pose a multi-billion dollar question:
Is Persian Gulf oil still worth defending with American military might?
I should note that back in 2004, I posited the need to plan a curtailment of Middle East oil in
Contingency Planning 101: Preparing for an world oil shortage:
[A]n oil shortage may impel more rapid adoption of alternative fuel sources, including natural gas, hydrogen, nuclear power. Coal, of which the U.S. has a lot, can be "gasified".
Gasification, in fact, may be one of the best ways to produce clean-burning hydrogen for tomorrow's automobiles and power-generating fuel cells. Hydrogen and other coal gases can also be used to fuel power-generating turbines or as the chemical "building blocks" for a wide range of commercial products.
The authors of the Foreign Affairs article suggest:
First, if the United States ended its commitment, how much likelier would a major disruption of Gulf oil be? Second, how much damage would such a disruption inflict on the U.S. economy? Third, how much does the United States currently spend on defending the flow of Gulf oil with its military? Finally, what nonmilitary alternatives exist to safeguard against a disruption, and at what price? Answering these questions reveals that the costs of preventing a major disruption of Gulf oil are, at the very least, coming close to exceeding the expected benefits of the policy. So it’s time for the United States to give itself the option of ending its military commitment to protecting Gulf oil, by increasing its investment in measures that would further cushion the U.S. economy from major oil disruptions. And in a decade or so, unless the region becomes far more dangerous, the United States should be in a position to actually end its commitment.
They suggest some sort of economic disruption:
Assessments of the U.S. economy’s sensitivity to oil prices also vary widely, but a reasonable estimate is that a doubling of the price of oil would shrink U.S. GDP by three percent—or approximately $550 billion. Of course, smaller disruptions would result in smaller economic losses, and the most catastrophic disruption—a long, complete closing of the Strait of Hormuz—would cause larger ones.
But the actual costs to the United States would be far smaller, because Washington could draw on the Strategic Petroleum Reserve, its emergency underground oil stockpile, to relieve the pressure on prices. The roughly 700 million barrels currently stored in the SPR form part of the more than four billion barrels held by members of the International Energy Agency (IEA), an organization founded in 1974 to coordinate collective responses to major oil disruptions.
What all of this means is that if the world experienced a massive disruption of oil from the Persian Gulf, a coordinated international release of various reserves could initially replace the vast majority of the daily loss. In all but the worst-case scenarios—far more severe than anything seen before—the impact of a severe disruption would be greatly cushioned.
What they do not discuss is the cushioning effect of the U.S.'s increased oil and gas reserves through the use of new drilling techniques and fracking - there is simply no mention in the article that the U.S. is thought by some to be the leader in energy reserves, as set out in in Oil Price.com's
"U.S. Has World’s Largest Oil Reserves":
The U.S. holds more oil reserves than anyone else in the world, including Saudi Arabia, Russia, and Venezuela.
That conclusion comes from a new independent estimate from Rystad Energy, a Norwegian consultancy. Rystad estimates that the U.S. holds 264 billion barrels of oil, more than half of which is located in shale. That total exceeds the 256 billion barrels found in Russia, and the 212 billion barrels located in Saudi Arabia.
The findings are surprising, and go against conventional wisdom that Saudi Arabia and Venezuela hold the world’s largest oil reserves. The U.S. Energy Information Administration, for example, pegs Venezuela’s oil reserves at 298 billion barrels, the largest in the world. Rystad Energy says that these are inflated estimates because much of those reserves are not discovered. Instead, Rystad estimates that Venezuela only has about 95 billion barrels, which includes its estimate for undiscovered oil fields.
Some analysis is less
aggressive in assessing U.S. reserves, because of a matter of "proven" reserves:
Proven oil reserves are those that have a reasonable certainty of being recoverable under existing economic and political conditions, with existing technology.
Let's parse that a little. The key part of the quote being "existing economic and political conditions," which exactly what we have seen play out with the reserves unleashed by fracking and unconventional technology being applied to the oil patch - as the price of oil from outside the U.S. rose, the ability and affordability of U.S. drillers to develop fields not cost effective under lower prices also rose. Now, as experience in using such techniques has grown, that "price point" has dropped, much to the regret of OPEC, which no longer has real cartel power over oil prices. See
Why OPEC can't stop the shale oil industry:
Just as a cartel benefits from cutting output to raise price, it suffers from raising output to lower price. This would not be true if it could permanently eliminate competitors by temporarily lowering prices, but that is not the case here. The shale oil industry is resilient and flexible – just as it can be pushed out of the market by very low prices, it can promptly get back into the market when prices improve. So an extended attempt by OPEC to close down the shale industry is a lose-lose situation, and as such is very unlikely to happen.
Perhaps this is a minor quibble, concerning the article, but the point I am attempting to make is that the economic impact of U.S. withdrawal from the Gulf may not be anything close to what is predicted in the article. In fact, it may further increase U.S. development of its own reserves and in alternatives (hydrogen fuels?) which may not be cost-effective in "existing economic and political conditions, with existing technology" but which may spur new technology and which would certainly increase American jobs for Americans, which, after all, is a pretty important governmental concern.
Now, let's circle back a little.
The U.S. government, in part due to the
"Carter Doctrine", has maintained a very expensive presence
in the Arabian Gulf.
The authors of the article pose the right questions - "Is it still in the U.S. interest to expend any effort in guarding those oil sea lines of communication that flow out of the Arabian Gulf? In whose vital national interests is it to keep sending aircraft carriers and other ships to attempt to preserve the status quo in the Arab/Persian Middle East? Is it time for the U.S. to remove itself from the Gulf? Whose interests would be served by our doing so?"
Would Iran establish the regional hegemony it seems to so strongly desire? Would the Chinese rush in to replace the U.S.? Or would the Chinese be concerned that the U.S. might suddenly free up a large portion of its Navy to be deployed to other areas that, 36 years after Mr. Carter's speech, are now of much greater interest to the U.S.?
I would argue that the new administration should take a close look at these issues and at the issues raised by the "You broke it, you fix it" attitudes in Iraq and Afghanistan. We have thrown a lot of time, talent and money into trying to convert those states into something that looks like us. It is time to rethink our goals and leave the inhabitants of the region to sort themselves out? Are we doomed to play Sisyphus and keep trying to push uphill the burden that no one in the area seems ready to take up? Is it time for us to engage in a little "benign neglect" and back off?
Is it time to postulate a policy built more on "
punitive expeditions" than on nation building? See
Intervention in International Law (1921) (pdf):
When the territorial sovereign is too weak or is unwilling to enforce respect for international law, a state which is wronged may find it necessary to invade the territory and to chastise the individuals who violate its rights and threaten its security.
Had we smashed the Taliban in Afghanistan for their support of al Qaeda and then left with a stern warning that we would come back again should they continue in their evil ways, would we have been better off?
If we had gone after Saddam Hussein in 1991 and punished him for his violations of international law, would we have had to go back?
With a new administration coming, now is the time to ask such questions, and set national strategy accordingly.
