Type: Exploratory
Pages: 12 | Words: 3428
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The problem ofa futureshortage of oilhas been known fora long time.In 1956,a geologist King Hubbertpredictedthat the United States oil productionwould peak in 1970.In addition, in1970,ESSO predictedthatthe world production would reach a peakin2030.In 1976, theUK Department of Energypublished areport, whichindicated that theoil reserves in the North Seawere about to peakby the end ofthe century (Mufson, 2006).After passing thepeakof oil production,all consumers around the worldwill faceenormous difficulties, not because of the high costof oil,but because ofthe oil gap.The oileconomy totally depends onthe approachingpeak production.

That is why the powerful countries are fighting for the oil territories, for example, the U.S., which is known to have the conflicts with Iran, Saudi Arabia, and Libya. Of course, according to the official U.S. reports, the conflicts with the above mentioned countries have another reason. Lots of controversy questions have appeared, and they can be summarized in one statement— the U.S. oil production has been in a peak for a long time. What is more, it is quite strange, that the countries, which are in conflict with the U.S., have most of the world`s oil resources. That is why the aim of the research paper is to find out whether the U.S. is indeed fighting for oil or not.

History of Fossil Fuel Exploration and Use

  1. First Steps in Exploration

The firstworld’s oilindustrial processwas carried out in1847in Apsheron(Azerbaijan).The firstoil wellin the worldwas drilledat the Bibi-AybatskomfieldnearBaku. Longbefore BC theoutputof oil and gas were discoveredin the Blackand Caspian Seasand usedfor heating,cookinggrease,as thecementingmaterial and theroad surfaceforsealing cracksandtarringships.Forseveral centuries Chinacarried outpercussion drillingwithbamboopipes. However,the systematicproduction of oilin the worldstarted in 2000 (Lemley, 2003). In 1859in Pennsylvania Edward L.Drakehas started producing thefirst oilin America. In 1887the large deposits ofoilin Texas were opened.Predatoryand unsustainableextraction of oil led torapid depletion of reservoirs. In 1871in Azerbaijan the first oiltanker was launched. In 1872the familyof well-knownoil industrialistsin Baku,Nobel,created the first oilcompany, andthree years laterbuilt its firstrefinery. In 1900the oil productionwas startedin Romania, California, and Indonesia (Sumatra). In 1914the oil productionwas started in Mexico,Trinidad,Venezuela and Iran (Mortishead, 2008).

From 1859to 1939the oil production in theUnited States accounted for 70% of world oil production.From 1954to 1974,world production ofcrude oilincreased more than fourtimes – fromabout 700million tonsto 2.9billion tons. Afterthe global economicdownturn in 1974 andreduction in production, the Member Statesof OPEC(Organization of-Petroleum Exporting Countries) causedthe fluctuations in production,which peakedat 3.2billion tonsin 1979and a minimum of2.8 billiontons in1983.The largestoil producersin 1987were the USSR, the USA, Saudi Arabiaand Mexico (Mortishead, 2008).

Until1950the USAproducedhalfof the world’soil. 48yearslater they could not produce even a half of the previous number. The United States had topursue a policy ofusingthe warto fight for oil; thus, this can explain the situation in Kuwait(Operation”Desert Storm”) and Iraq (2003-2004). In the early1960s,the Soviet UnionreplacedVenezuelafrom the position of the secondlargest oil producerin the world.Release oflarge amounts ofcheapSoviet oilforcedmany Westernoil companies to lowerthe prices forcrude oil producedin the Middle East. Thus, thepayments for theusage of the natural resources in the MiddleEast were reduced.This decrease inrevenueswas one of thereasons for the creationof the organizationof oil producing countries— OPEC (Aleklett, 2006). During the second halfof the 1960s andearly1970s,oil consumptionincreasedby about 8% per year.Inconnection with the globaleconomic downturn andthe increasing use ofmore common fuelssuchas coal, the rateof increasein oil consumptiondeclined by the end ofthe 1970sto 6% (Aleklett, 2006).

The sharp declinein the world oil prices was due tothe developmentof alternative energy sourcesin the mid-1990s.Itcaused an increasein oil consumptionup to 3 billiontons.Thus, in 1990, the world’s provenrecoverable reservesof liquid hydrocarbonswere125billion tons.About 63%of these reservesare concentratedin the Middle andNear East.Saudi Arabia, Kuwait, Iraq, United ArabEmiratesand Iranare countries with thelargestproven recoverable reserves. The leadingoil consumersare the USA,Japan and Western Europe (Mufson, 2006).

2. International Conflicts for Oil

Nowadays lots of international conflicts have double roots. As a rule, the countries are fighting for power, under the shadow of other reasons. Thus, everybody understands that if the country has an access to oil drilling it will be very powerful, as the oil reserves are declining. Thus, many conflicts on this issue have appeared.

According to Kevin Hall, the national economics reporter for “McClatchy Newspapers”, one of the largest Italian oil companies «Eni» has stopped the deal with a major Russian oil company «Gazprom», whose president was Vladimir Putin. As the consequences of the suspension, «Gazprom» can no longer receive a large share of Libyan oil. The U.S. foreign policy focused on this situation for three years. Kevin Hall has studied the Wiki Leaks documents and discovered that while Mr. Berlusconi ascended to the post of Prime Minister of Italy, the United States put pressure on him. The new government had to force «Eni» to make the act against the interests of Russian oil company. «Gazprom» had to be the partner of «Eni». Italians play an important role in Libya, which is its former colony. In addition, they were on good terms with Gaddafi. «Eni», in turn, should have been included in the Russian project «South Stream» in the Caspian region (Mohamed, 2006).

However, this project was a competitor to the American project «Nabucco». According to the U.S. project, the natural gas from the eastern border of Turkey was supposed to come to Europe, bypassing Russia. More than 1,800 documents speak about the «Cold War», «Gazprom» and the need to restrain the influence of Russia. Russia today is the largest producer of energy. The oil production and natural gas levels in Russia are higher than anywhere else. Most of these resources are transported to Europe. The U.S. has decided to free Europe from Russia as the only one source of energy. The countries have already seen that Russia uses its resources as their main weapon in the fight against the interests of Ukraine, Belarus and Georgia. Libya is yet another example. At the same time, it should be admitted that Russia has actively marketed the new fuel cells. For example, wood pellets are a real alternative to wood fuel (Mohamed, 2006).

Another part of Libya’s conflict lays in the fact that «Eni» was also looking for a way to invest in Iranian oil that contradicts the U.S. policy. «Eni» has been mastered in Iran for a long time; however, the export of Iranian oil and selling it on the open market did not suit the American government. Italian Oil Company has already clashed with the USA. Now, «Eni» cooperates with «Gazprom», Russia and can have a big share of Libyan oil. The French are also involved, and, moreover, they are interested in owning a large share of oil production. Together with the United States they are trying to overthrow Gaddafi and get rid of «Gazprom» (Ricks, 2006).

The outcome of the war largely depends on how the world oil-producing countries will agree on the common decision. For example, the Arab oil-importing countries see Libya as the rival; that is due to the support of the United States. Russia, the largest supplier of gas to Europe, voting for UN Security Council resolution also got rid of its competitor, Muammar Gaddafi, who gave up indefinitely the plan to build a pipeline from the rich deposits of the natural gas from Libyan Desert to Italy. Moreover, it should be taken into the consideration that the world was covered with the biggest in the last half-century economic crisis, and 2% of the Libyan oil can be a critical figure in the global oil market.

Peak Oil Theory

  1. Background of the Theory

In1954-1956Dr. M.King Hubbert, the famousAmerican geologist, formulated the basiclaws, describing thedepletion ofany finiteresource:

  • Productionstarts from zero;
  • Productionrises toan unsurpassable peak,;
  • After thepeakis passed, the production declinesuntil the full resourceexhaustion.

These simple rules can be applied to any system of mineral resources, including extraction of petroleum resources. Based on his theory, in 1956 Dr. Hubbert predicted that the United States oil production would come to peak in 1970.It should be noted that that time the U.S. extracted about half of all oil in the world and was the largest exporter of oil. Of course,the theoryhad not been taken into consideration until1971,when it was suddenlyfounded out thatincreases in oil productionin the U.S.,despite the best effortsof the federal government,stopped andbegantodecline.After this,a naturalinterest inthis theoryhas forcedscientists to conductthe research on thepredictionof the peakof oil productioninone countryandin the world in general. In accordancewith the results ofthese studies, currentlyamong the countriesthat are makinga significant contribution to the worldproductionof oil (more than0.5 millionbbl/ day), the peakoil productionhas already occurredin 36 countries(1 barrel= 159liters).The projections,made byHubbert’s theory, differed fromthe date of theactualpeak for notmore than two years.The accuracy of calculationsdependson the accuracy ofestimatesof oil reservesin the country (Mufson, 2006).

As for theforecaststo achievethe globalpeak of oil production,it may be noted that the vastmajority ofassessmentsfall within theperiod 2005-2015(Ricks, 2006).

2. Current Situation and Predictions

A characteristic feature of oilproduction peak is that with the approaching to thepeak, the growthin production slows down.At the peakof itsrate it is equal tozero,and thenthe productionstarts to fallandthe rate takes thenegative values.Asthe world oil consumptionin recent years is growing at1.5-2.5% per year, theapproaching to thepeak of productionwill inevitablyoccur, orhas already occurred. It is a periodwhen the growthof oil productioncannot compensate the increased demand. As a result, the priceof the resourcewill growaslong, asthe demand does notequalizewith the proposal.Thus, due to theslowing downof theproduction, the oilsupply cannotmeet thegrowth inoil consumption,and the marketwill run outof the resource (Gaurav, 2008).

Recent rises inthe oil pricesthat have been seen from Septemberhappeneddue to thefundamental causesof the realshortage of oilin world markets.This is indicated byseveral factors. First,according to data publishedin the IEA September report, thetotal reservesof oilconsuming countries declinedto its lowestlevel in five years.This enables thespeculatorson the stock exchangeto raise prices, expectinggrowthstocks toaverage. A tendency can be seen that having sufficiently high oil production in the world, the oilreservescontinue to decline.Moreover,the U.S. crude stockshave decreased with the occasionalbreaksfor three months(for the last 14weeks there wereonly twoslightincreases intotal reserves of oil,the rest of thestockshave beendecliningandstayed at the minimum values over the pasttwo years).Naturally, the market by increasing the pricesfor oil is trying toincrease the supplyorreduce the consumption, andall the otherreasons, cited byexperts (the Turkey-Iraqconflict,speculation, the declineof the dollar etc.),have the secondary importance (Gaurav, 2008).

It should be noted, that namely, according to the majority of analytics,the growthin oil consumptioncan be suspendedonly ifthe prices for petroleum productswill be about twodollars perliter.On the otherhand,in many states(the entireEuropean Union, Israel, Turkey, etc.) the price ofoilhas been close to thisfigure for a long time. However, witha marked reductionin oil consumption, ithas not been observed.Therefore,it is possible that the price, at whichoil consumptionstabilizes orbeginsto decline,will be higher. For the pastten years,it became obvious thatthe gas prices arepractically the same asthe prices of oil.If in 2000the price of gasin Europe and NorthAmerica fluctuatedaround55-60dollars per 1,000cubic meters,at the moment itis an average of240-250dollars. Thus,we can expectthat within the nexttwo to three yearsthe gas priceswill increase to$ 500per 1,000 cubic meters. Coal pricesalsorose, but they are significantlybehind the evolution of pricesfor oil andgas.This is due toa significantsupplyof coalon the worldmarket andthe difficulty ofreplacingoilwith coalwithout majorchanges in technology, which, inturn, requiresboth timeand money.It is clear,however, thata furtherrise in pricesof oil and gas, coal andnuclear powerwill occupyan increasingly important placein theglobal energy sector, despite seriousenvironmentalproblems (Fox, 2007).

Perhaps the mostunpleasant, butinevitable consequence ofraising the pricesfor oil and gaswill bea significant rise in the costoffood.Withrising pricesfor petroleum products, the price ofbio fuels is increasingand, consequently, increasesthe price ofcorn andsugar.

Peak oil, 9/11, and the War on Terror

  1. 5 American Lies

The terrorist attacks ofSeptember 11, 2001,the ensuing war in Afghanistanand the “war on terror”have changed the world.However, justasthe allegedWeaponsof Mass Destructionhad nothing to dowith the invasionof Iraq, andOsama BenLadenhad nothing to dowith the warin Afghanistan.The realreasons forwarare oil,gas and pipeline around theCaspian Sea.Operation”11thof September”set itself thegoal to givenew impetus to the U.S. attempts togain the controlover foreignoil and gas. Thus, as it has been evaluated after, one of the major motives why the President George Bush permitted and controlled the attack and, actually the war with Arabian world, was the oil. 11th of September became very suitable pretext to occupy Iraq and use the fields of oil. America has already stated 5 statements, which have no real explanation (Burke, 2004):

First lie: in 1999, and laterin 2001,the Taliban came to the conclusionthat the presence ofBen Ladenin their territorypreventsinternational recognition oftheir regime, and proposedto remove himto the United States, or, at least, neutral country.The U.S.refusedboth times.How can be explainedsuch a refusal?

Second lie: shortlybefore the Septemberact of terrorism, Osama Ben Laden, who by then hadbeen activelysought bythe Americans, apparently,for the pastthree years,quietlyshowed upin Dubai,where was not onlyeasilytreated, but alsomet bya representative ofthe CIA.

Third lie: immediately after theSeptember terrorist attacks,the Talibanagainofferedto extraditeBen Laden, in order tojudge himin a neutral country.The precedentwas: in relation to airattack inLockerbiea citizenof Libya was extraditedand sentenced.However, this propositionBushimmediatelyrejected.Why?

Fourth lie: it is a well knownfact that theU.S.fundedand armedBen Laden in Afghanistan so thathe wasable to controlthis country.Far fewerit is known aboutAmerica`sattitude to the armedfanaticsfor similarproblems in Bosnia, Kosovo, Macedonia andChechnya.Why has the U.S.authorities refused toopen thedocuments on theU.S. rolein these warsthat ledto suchtragic consequences?

Fifth lie: the U.S. claims that the destruction ofthe Taliban regimewas necessaryto guaranteedemocracy andhuman rights of women.However, who willreplace them?The NorthernAlliance, created by Massoud, who tooka worthy place in the list ofleaders ofthe bloodyterror anddrug trafficking?

All these factssuggest the ideathatthe question of warwas settledlong before theterrorist attacksof September 11. In addition, it wasunequivocallyconfirmed byNiazNaik, a formerPakistani Foreign Minister.According to him,at the end of July the U.S. officialsdiscussedwith himtheir plan formilitary actionto topplethe Taliban regimeand the establishment ofruleof “moderate Afghans”.To carry outthis actionit was planned tousemilitary basesin Tajikistan, wherethe work was alreadyledby American advisers.Americanstold him thatif Pakistan supportedthis action,it would be held before thesnow falls, that is, at the latest, in the middleof October.

2. 9/11 Made up Conflict

As it has been already mentioned, the U.S. can`t answer many questions about the events after the act of terrorism on 11th of September, as well as the events during this act.

According to the official version, early in the morning, on the 11thof Septemberthe terrorists hijacked fourBoeingpassenger planes within an hour. The nineteen terrorists, all Arabs, were armedwith box cutters. They took control over the jets and altered the coursetowards thetargetsin the heartof New York andWashington. TwoBoeingsweredeliberatelyaimedatthe Twin Towers, as a result of which theflame started inside of the buildings and itmelted the supporting steelstructure, which causedthe complete destruction ofbuildings. However, the officialversion cannotwithstand the critical examination (Cohen, 2001).

In accordance with the official version, the nineteen terrorists hijacked four Boeings.There definitely Arabs ready to sacrifice their lives for what they believe to be the right cause (freedom of the Arab people from the constant interferenceof America and thebrutal aggression of Israel), althoughit would have been difficult to find such a number of them for onemission. In addition,where were founded Arabs, who also knew how to operate Boeing757 and Boeing767?(None ofthe alleged Arab hijackerswasworking as a professional pilot.) What is more, it is very strange that the Boeings, changing the course, have not been noticed and have not metthe obstacles fromthe U.S. government(which includedthe U.S. Air Force), which was responsible for protecting theair space(notwithstandingthat the Pentagon jetwas in the airfor nearlyan hourafter the firstcollision).

As for the towers, it is obviousthat they were destroyednotonlyby the collisionwith the aircraft. Both of them stood for 45 minutes to an hour and a half after the impact. According to the official explanation, faithfully parroted bythe media,is that the towerscollapseddue to the jet fuel whichmelted the steel girders. There was much black smokeand soot coming from the Twin Towers, butthe firewas almostnot visible.In order tomelt the steel the hightemperature is needed, obtained,for example,by usingan acetylenetorch.If the jet fuel is burningin air, specifically inside a buildingthat is filled with a lot of smoke andlittle oxygen,it can`t provide such temperature. If thecolumns had melted, that the resulting weakness would have never been symmetrical (that is neededwhen the building was”composed”in a controlled demolition).In the process of an uncontrolled collapsethe piecesof concrete and steel beamswould bescatteredover a largearea, causinghuge damage tosurrounding buildings inlower Manhattan andresulting to the numerousvictims among the population (Cohen, 2001). None of this occured.

The study ofthe chronology ofthe September 11thevents provides evidencethat the collapseof the Twin Towers was not caused by the fire.First, one plane hit the NorthTowerat 8:45am.The plane crashed into thecenter of the towerat a right angle, which was followed by the huge explosion.At 9:03, another plane hit the South Tower. However, the one, who ran the aircraftfailed toimplementa collisionat a right angle, and the planecrashedclose to the edgeof the towerat an acute angle, a relativelysmall amount of fuel got into the building, the mainpartburnedin the fireball. As the fueland plane at the beginning shared a same trajectory,and afterthe collision, the metalwreckagefollowed much the same direction as the fuel: through the corner of the Tower.All of the steel columns,that supportedthe major load, weresituated atthe center of theskyscraper, that is why most of the metallinercould nothit the centralcolumns, whichwere not damagedafter the collision.

Thus, both the plane impact and the fire couldn’t cause sufficientdamage tothe SouthTower, so the South Towercollapsedfor another reason.

  1. Real Causes of 09/11Events

In 2001, Bush has signed the huge contract for 200 milliard dollars for the constructionof another, even moremonstrous fighterJoint Strike Fighter.In fact,the war unleashed bythe United States,pursues muchbroaderpurpose (Thompson, 2008):

  • Control overoil and gasin Central Asia.
  • The introduction ofmilitary basesin the heart of Asia,between Chinaand Russia.
  • SavingAmerica’s dominanceover SaudiArabia.
  • Militarization of the economyas a means of “overcoming”the glowof the crisis.
  • Crackdownof the Third World andanti-globalization movement.

Thus, the war of terror can be simply a pretext to the real war for oil.

Alternative Energy

  1. Power of Oceans

It is known thatthere are enormous energy reservesinthe oceans.Thisthermal energycorresponding to the overheatingof the water surface compared tothe bottom, say,20 degreeshas a value order of1026G.Akinetic energy ofocean was currentlyestimated at1018G.However, today, peoplecanonly use avery smallproportion ofthese energies, and thecostof the largeinvestmentsis slowlypaying off.Untilrecenttimesthe usageof ocean energyseemed to be unprofitable. The most commonis theproductionof energy fromenergy tides.In1967, inDeltaRans, France, thetidalpower station(SES)with the capacity of 240MW was built.Herethe tidesreach a height of13 m.In 1968,the SovietengineerBernstein developed aconvenient way totowSESinthe right place. In the same yearhebuilt anexperimentalSESin AcidBay, nearMurmansk (Cantor, 1993p.43-45).

2. Power of Sun

The recent interest in the issue of solar energy has increased dramatically.The potential possibilities of using the direct solar energy are very large.If 0.0125% of this energy had been used, the humanity would have been fully equipped with energy today. The use of 0.5% would have fully covered all needs of the whole humanity (Cantor, 1993p.51-52).

3. Power of Wind

This type ofenergy is an indirectform ofsolar energy,and, therefore,belongs torenewableenergy.The use ofwind energyis oneof the oldestknown formsof energyobtained fromthe environment. At the end of2007,the totalinstalledcapacityof windturbines in the worldwas94.1gig watts.Despite the factthat the resultingelectricitywas 1% of theelectricity consumption in the world, wind power accounts for approximately19% of electricity use in Denmark,Spainand Portugal – 9%, GermanyandIreland – 6%(datafor 2007).In globalterms, the production ofelectricitythroughwind energyhas increased five timesbetween 2000 and2007 (Mortishead, 2008).

Thus, if humans use even 50% of power of wind, oceans and sun, there would be no need to consume a lot of oil and gas for the industrial sector, which would decrease the amount of the resources used in the world (Cantor, 1993, p.3).


To make the long story short, there are lots of evidences that the U.S. made up the whole conflict with the act of terrorism just in order to have the pretext to start the fight for the oil. Indeed, the peak theory should be taken into consideration. Due to it, the U.S. oil production has been on the peak few years ago. The fact is that the U.S. government is aware that in the future the countries, which have access to oil, will be the most powerful, because oil is black gold, and it will always be valuable. However, the main roles in the whole situation with oil play not the U.S. government, but the transnational corporations, which became more powerful than government. Thus, the act of terrorism may be not carried out by Al-Qaida, but there is a big possibility, that it was done by the U.S. itself.

Another thing is that, it is very strange that the U.S. is a member of all conflicts with the countries, which have one of the greatest resources of oil. In addition, it seems that the U.S. planned the conflicts long before they started. Thus, the U.S. was on Saddam Hussein’s side in the Iraq-Iran war. The U.S. also took part in Libyan conflict, with the UN Resolution. Even now it can`t be explained whether the resolution was humanitarian intervention or humanitarian imperialism. Even if to count the money spent on the war — the numbers are enormous. There is a big doubt if there was no oil, whether the U.S. would spend these sums to prevent the terrorism. That is why it is more likely that the September act of terrorism was artificially invented by the U.S. in order to have the pretext to start the war for oil.

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