January 23, 2006
|The Thumb On The World's Jugular||Future Peak Oil War and Peace|
World oil production is barely keeping up with demand. There's no spare capacity, no slack in the system. John Robb points out an enormously significant consequence: from here on out, global guerrillas can control the price of oil via relatively minor disruptions in the supply system. This puts one hell of a weapon into their hands. Excerpt:
The control over the price of oil is in now in the hands of global guerrillas — the open source, system disrupting, transnational crime fueled, sons of global fragmentation covered by this author. These actors can now, at will, curtail the supply of oil through low tech attacks on facilities in Iraq, Nigeria, central Asia, and India. The amount of oil effectively under their control exceeds five million barrels a day, more than Saudi Arabia's two million barrels a day of swing production.
It's important to note that this capacity to disrupt production is substantially different than any terrorist threat we have faced in the past. With terrorism, the potential of damage has always been from single large attack on a major facility or node (extremely difficult to accomplish and relatively easy to recover from). Today's threat is based on sustainable disruption — ongoing, easy, low-tech attacks that are nearly impossible to defend against (everything from pipeline destruction to employee kidnapping). [...]
This situation is merely the first stage in the larger epochal war between non-state groups and nation-states. It is by no means the worst of what we will need to deal with...In the meantime, given that the demand for oil continues to increase (due to the growth of China and India primarily) combined with the inability to bring new supplies to market, the price of oil will continue to climb. $100+ a barrel oil is not unforeseeable. [...]
The success of guerrillas to control production in Iraq and Nigeria will spawn similar developments in other locations. High on that list is Russia, the world's largest oil producer, and the Caspian Sea producers. [Emphasis added]
Guerrillas are already significantly curtailing oil exports from Iraq and Nigeria. And as Robb says, there's no stopping them. How are you going to guard thousands of miles of pipeline? Decentralized, freelance, non-state actors with their thumb on the jugular of the industrialized world. Welcome to the twenty-first century.