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Geopolitics - May 1

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Rising Powers, Shrinking Planet - Global Fight for Oil
(Michael Klare interview)
Sandip Roy, New America Media
Q: During the Cold War the world order was fairly well defined. There's a new international energy order. Who are the players in this version of the great game?

Michael Klare: In the Cold War era, the two main poles of power were the Western block, with the United States as the dominant power and the Soviet block. In this new world order, I believe it's bifurcated between energy surplus countries -- countries which have enough energy to supply their own needs and to export energy to others -- and energy deficit states, countries like the United States, China, Japan and European countries which don't have enough energy to meet their needs and are dependent on imports from other countries and therefore are beholden to them in various ways, economically and increasingly politically.

Q: What about the group of countries who are neither militarily powerful like the United States is, and also deficit in energy? Do they just fall off the order?

Michael Klare: Those countries are at the bottom of the barrel, literally speaking and if they're poor developing countries like in Africa and Latin America, they're going to suffer terribly, because among other things, agriculture is an oil dependent activity and the price of agricultural products has risen enormously and as a result, food prices have risen and we've seen terrible consequences of this, with rising food prices, food riots and people facing starvation. This is a product, as much as other things, of the rising price of energy.

... Q: You write that the long-term risk of escalation is growing more potent. If you look into the future, where do you see this race for energy resources tipping over into military conflict?

Michael Klare: The place that I worry about the most is in Central Asia and the Caspian Sea. Because there you have three great powers contending for influence: you have the United States and China, which want to extract resources from the area, and you have Russia, which doesn't need the area's resources for its own purpose, but which seeks to control the flow of oil from that area. Russia, which once controlled this when it was part of the Soviet Union, and before that the Czarist Empire, now wants to insure that all of the oil and natural gas flows through Russia through Gazprom's pipelines to Europe.

So, it also seeks to control the area. All three countries are using military means, so you have three great powers contending for influence, all three are supplying weapons, two of them -- the United States and Russia -- have military bases in this area. Three of them are involved in military aid, military training, military exercises and on top of that it's inherently unstable; there are ethnic conflicts. So this is the kind of situation -- if you could picture the Balkans before World War I, it's exactly the same kind of scenario -- where a local conflict, an ethnic conflict could explode and bring the great powers into it overnight, without anybody anticipating this, but provoke a great power conflict.
(29 April 2008)

Why did Saudi Arabia let the dollar dip?
Hans Noeldner, Email
I cannot recall having seen any EnergyBulletin posting which explains this dip:

finance.yahoo.com/currency/convert?amt=1&from=USD&to=SAR&submit=Convert

Why did Saudi Arabia let the dollar sink a bit for a while thereā€¦and then prop it up again? Was it to "send a message"? If so, could it have been, "Forget attacking Iran!"?

Curious readers want to know!
(1 May 2008)
Scroll down on the page to see the pronounced dip that Hans is talking about.

What do you think? Leave a comment below.

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