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The paradox of energy security

Efforts to secure the flow of energy often do the opposite, reinforcing injustice and historical resentments, argues a new book

Northern Iraq is at war. Renewed sanctions on Iran may be imminent. Opec is cutting supply. Venezuela is collapsing. Relations between Russia and the West are deteriorating. Terror groups are targeting energy assets in countries like Libya and oil-producing South Sudan is a failed state. China is flexing its muscles in the South China Sea. More prosaically, international oil companies have carried out a huge upstream investment retreat since 2014.

Such ingredients—especially in combination—would once have spiked oil prices and prompted urgent global summits. These days, oil markets remain sanguine and energy security has lost its paranoia factor.

The rise of American oil and gas and public notions of supply abundance is one reason. The fast growth of renewables and distributed energy also affects the mood. The tight oil guys will just pump more when we need it, right? And the sun's not about to disappear.

If there is a flaw in Energy Security, by Roland Dannreuther, professor of International Relations at London's University of Westminster, it's in its timing. Oil's latest glut means his book will get less attention than it deserves. Yet policymakers ought to read it.

One of the main arguments of Dannreuther's book is around the notion of justice. Energy security can only be achieved, he writes in his conclusion, "if it can also promote social and economic development for all and ensure that our civilisation is environmentally sustainable".

Too often, Dannreuther shows, the yearning for energy security brings the opposite, leading to competition between states (and sometimes war), domestic disruption in some producer countries, or harm to the environment.

Energy security is in the eye of the beholder and its pursuit can have unintended consequences. Thus, for example, the EU's three goals in the past decade, of liberalising its energy market, diversifying its supplies and cutting emissions appear strategically sound and benign. But not to Russia, which relies on Europe's gas market—and, in the face of a threat to its own energy security, defined by Gazprom as security of demand, now trumpets a pivot to Asia, has cut Ukraine from its export routes and seeks to divide EU member states.

Environmental goals haven't rested easily with energy security. Everyone knows how damaging coal is, for example. But it is cheap, abundant, often close to consuming centres, and less vulnerable to supply interruptions or price spikes.

"The values of energy security and economic prosperity, particularly for developing countries seeking to make the transition to modernity, have tended to take priority over the value of sustainability," Dannreuther writes. Energy security is a "private good which is nationally determined", while climate change mitigation is a "public good… for which there is no general global responsibility".

Energy politics

Donald Trump's withdrawal from the Paris Agreement—part of his "American First" agenda—is just the latest manifestation of this. But others have their version. "For emerging countries like China and India, climate change is essentially viewed as a development problem which will be resolved once…they have become developed countries". They reserve the right to use coal and other fossil fuels that earlier drove the industrialisation of the already developed world, notes Dannreuther.

This kind of historical legacy affects the geopolitics of energy security too. Western countries achieved post-war energy security with the partition and control of the Middle East and the arrival of overpowering corporate interests. So it was a shock when producer countries shook off this foreign yoke in the 1970s, bringing the (Western world's) first major oil crisis.

Since then, energy security has been a tenet of US engagement in the Middle East, but often with the opposite outcome. Thus the dual-containment policy of Iraq and Iran, trying to nullify their threat to the region, deployed the "oil weapon" in reverse, writes Dannreuther—deliberate efforts to restrict oil exports from both countries. "This led naturally to a restriction of the supply of globally available oil which in turn had an impact on oil prices, contributing to their rise during the 2000s."

One might add that the presence of US troops in Saudi Arabia inspired, partly at least, the 9/11 terror attacks, the subsequent invasion of Iraq and the collapse of its crude output—just as China's economy and oil demand were taking off. The 9/11 wars "led to significant shifts in the regional and international balance of power, which in turn revealed a series of historical injustices and resentments which…contribute to growing energy insecurity." It also increased the relative global power of Russia, a more geopolitically assertive exporter, and China, an internationally more active importer. Both shook Western faith in the security of their supply.

Throughout the book, the justice theme stands out. Supply isn't really secure if it comes from a rentier state where the elite monopolises the rents. Military or even corporate engagement doesn't yield energy security if it breeds resentment and hostility. The importer's energy security is not necessarily that of the exporter's. And despite America's new producer power, enhanced energy security remains a phenomenon of the rich world: another 1.4bn people, points out Dannreuther, lack access to electricity, and 2.4bn don't enjoy modern cooking facilities. Global energy security remains a long way off.

*Energy Security, Polity Press, Cambridge: 2017

 

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