The term energy superpower does not have a clear definition.[1] It has come to refer to a nation that supplies large amounts of energy resources (crude oil, natural gas, coal, uranium, etc.) to a significant number of other states, and therefore has the potential to influence world markets to gain a political or economic advantage. This might be exercised, for example, by significantly influencing the price on global markets, or by withholding supplies.[2][3] The status of "energy superpower" should not be confused with that of "superpower", as the nature of an energy superpower is defined very differently due to the non-military nature of an energy superpower's power base.
Energy superpowers project greater power than would be otherwise possible due to their lock on the exportable energy markets, and are becoming increasingly valuable to the global economy. In the global commodities' boom of recent years many of these states have benefited massively from increased production and prices.
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Russia has the largest known natural gas reserves of any state in the world, along with the second largest coal reserves, and the eighth largest oil reserves.[4] Since 2009, Russia has been the world's largest oil producer after overtaking Saudi Arabia as the world's number one.[5] It is also the world's biggest natural gas producer, with 22.3% of global natural gas production, and also the biggest exporter — with 24.0% of global natural gas export.[6] In recent years Russia has identified the gas sector as being of key strategic importance. Many private oil and natural gas companies, most notably Yukos and Sibneft, have been consolidated under the control of the state-controlled Rosneft and Gazprom organisations respectively.
Gazprom has control over all gas pipelines leading out of Central Asia, a region rich in the resource. Russia has used such gas, primarily that from Turkmenistan, on occasions where it has found itself unable to meet all delivery obligations from its own domestic production plants. Such circumstances in 2000 led to Gazprom allowing Turkmenistan to use its pipelines to supply gas to the highly-subsidised, low price Russian domestic market - leaving Gazprom free to fulfil its obligations towards European customers.[7] Gazprom sells 33% of its gas to Europe, accounting for nearly 70% of the company's revenue. The remaining 30% is sold for domestic Russian consumption at highly subsidised prices.
As of 2006, Russia supplies over 25% of Europe's oil and over 40% of its gas. Its energy superpower status has recently become a hot topic in the European Union.[8] Russia's overwhelmingly large reserves of natural gas have helped give it the title without much debate.[9][10] Still, Russia's status as an energy superpower has been called into question by some. As Vladimir Milov, of the Carnegie Endowment for International Peace, says :
The “energy superpower" concept is an illusion with no basis in reality. Perhaps most dangerously, it doesn’t recognize the mutual dependence between Russia and energy consumers. Because of political conflicts and declining production, future supply disruptions to Europe are likely. As a result, European gas companies may likely someday demand elimination of the take-or-pay conditions in their Russian contracts. This would threaten Gazprom’s ability to borrow. Putin’s attempt to use energy to increase Russian influence could backfire in the long run.[11]
Russia has recently been accused by the West of wielding its natural resources as a policy tool against states like Georgia, the Ukraine, and other countries it feels "threatened" by.[12] At the beginning of 2006, Russia greatly increased the price of gas for Ukraine, following the country's Orange Revolution. It later doubled natural gas prices to Georgia, following an international incident. Critics speculated that it was an attempt to undermine the Georgian leadership's defiance of Moscow.
In turn, Russia has accused the West of applying double-standards relating to market principles, pointing out that it has been supplying gas to the states in question (ruled by regimes Moscow considers "unfriendly") at prices that were significantly below world market levels, and in some cases remain so even after the increases. Russia argues that it is not obligated to effectively subsidise the economies of post-Soviet states by offering them resources at below-market prices. Russia has greatly increased the price of gas for Armenia and Belarus, which, unlike Georgia and Ukraine, have been closely allied with Moscow and form a loose union state with Russia.
Despite Russia's vast potential, there had been concerns voiced by TNK-BP's Viktor Vekselberg that it would run into grave difficulties in 2007,[13] citing that Russia had not opened up any new gas fields since the fall of the Soviet Union, and those currently operating were rapidly being depleted. However, this opinion comes in direct contradiction to known facts, as Russia was not reported to have run into gas shortages during 2007. In October 2001 Gazprom began production at the Zapolyarnoye field in western Siberia measured at 3.2 trillion cubic meters. This puts Zapolyarnoye field in the top 10 largest fields in the world.[14][15]
Despite this fact, some continue to argue that inefficient plant and aging infrastructure could force Russia to import additional gas from Central Asia.[16] Such a scenario is not inevitable, as Gazprom has access to vast amounts of gas, and according to Gazprom's Alexey Miller intends to singlehandedly explore the Shtokman Field, one of the world's largest natural gas fields.[17]
It is noteworthy that Russian gas imports present a lucrative opportunity for the country. In 2008 Russia planned to import most of its gas from Central Asian republics for a price that ranged between $100 and $150 per 1000 cubic metre. It re-sells most of this gas to Europe for a price that tops $250 per 1000 cubic metres.
In addition to the recognized powers, certain states have large energy reserves that have not yet been exploited significantly, and therefore have the potential to become energy superpowers in the future.
According to Manik Talwani, a geophysicist at Rice University, there are two countries that are most likely to attain the status of Oil superpower: Venezuela and Canada.[18] Citing their enormous potential reserves (1.2 trillion potential barrels for Venezuela and 1.75 trillion for Canada's oil sands), Dr. Talwani believes that they have the reserves to become energy superpowers in the next few decades as oil production declines elsewhere. However, as Dr. Talwani notes, both need 100 billion dollars or more to increase their production levels up to those of true energy superpowers.
Recently a new strategy has emerged from al-Qaeda when it comes to fighting the United States. Rather than only targeting the U.S. interests directly in an attempt to cripple it, al-Qaeda now believes that cutting off the supply of energy to the U.S. should be a high priority.[19] In particular, several powerful energy producing states like Saudi Arabia & Canada have had their energy industries listed as targets in al-Qaeda's effort to bleed the U.S. dry. In an apparent attempt to carry out this strategy, several masked men attempted to enter and destroy a section of the Saudi Abqaiq oil refinery. As of yet no attempt to attack energy industry infrastructure has succeeded by a known terrorist group, although Nigeria faces disruption of its energy industry by local rebel forces.
Says Ian MacLeod of the CanWest News Service, "A major supply disruption would send energy prices soaring. Had the Abqaiq attack been successful -- guards fired on cars driven by the bombers, detonating the explosives inside -- some experts say oil prices would have likely broken all records. A catastrophic hit could bring transportation and other parts of the U.S. and world economies to a standstill."[19]
Energy superpowers as a result, while possessing great natural wealth, are becomming targets in the worldwide War on Terrorism. While Saudi facilities are relatively well-protected, there is no consensus to the seriousness of the threat to other countries, or how well prepared they might be to stop an attack.
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