Summary and Info
The book begins with some good definitions that guide the global oil industry. In terms of "energy grades" oil is a clear winner for powering Large Independent Mobile Machines ( LIMM ). Cars are the most popular LIMMs today and oil drives these machines. The concept of "eminent domain" in terms of the ownership of natural resources of a country establishes the supremacy of the State and the key to Government policies over oil reserves in various countries. The concept of "territorial imperative" links the valuation of shares of oil companies with their untapped proven oil reserves. Since oil is a depleting asset, oil companies should keep moving across our planet's surface in search of new reserves.
The core theme of the book is around the American automobile industry and its linkage with America's foreign policy in its quest to keep feeding the millions of energy hungry vehicles on its roads. The book claims that the public transport system was systematically dismantled in America to aid the growth of the market for cars. Cheap oil was then a necessity to make their running costs affordable. Cars are very closely linked to the American culture and the country has the highest ownership of about 832 cars per thousand population. In per capita terms Americans own more than double the number of cars, use them for double the mileage per year, and own cars that are bigger and consume nearly double the quantity of fuel per mile in comparison with Europe. Things were fine till such time America had plenty of oil in her own land. Suddenly "Hubbert's Peak" becomes a reality and in 1974 America was caught off guard by the oil shock.
What follows is an exciting read on the impact of America's external dependence for her oil . With over 11 million barrels of the daily consumption of 20 million barrels being imported, American oil companies are now driven by the territorial imperative need to find large oil wells outside America. Unfortunately over a quarter of these proven reserves are in "not so friendly" or "politically unstable" countries whose governments exercise the eminent domain over the precious commodity.
The book discusses the following points very convincingly :
- In the desperate search for oil, America is endangering the environment in Alaska
- The present US government is friendly to American oil companies
- Oil companies would like to maximize their wealth through larger control of global oil reserves and simultaneously maintain a higher price for oil
- America's need to diversify its oil imports away from the Persian Gulf
- The Caspian reserves are not so promising as once believed
- The Gulf finally holds the key to global oil supplies and prices
- America's indifference to switch over to more fuel efficient vehicles
- The recent American Invasion of Iraq as a means to create an alternative to Saudi supplies
- Current proven reserves, their global distribution and the likely supply and demand scenarios till 2050
- Scenarios of surge in demand for oil from fast growing countries like China and India
- Need for alternative energy sources
Many of the conclusions are debatable. But the book establishes a clear logic in the linkage between foreign policy and oil.
References mentioned in the notes at the end of the book are very detailed and can be a good list for any researcher on the topic of oil.
More About the Author
Ian Gregory Rutledge (born 24 June 1972 in Cudal, New South Wales) is a field hockey coach, who was born in Australia.
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