Today the Western world is weary of its dependence on the Arab oil and definitely wants to get rid of it - one way or the other. Former US Vice President Dick Cheney, once said, "The problem is that the good Lord didn't see fit to put oil and gas reserves in places where there are more democratic governments." With most of the proven oil reserves in this part of the world, the sense of uneasiness and indeed helplessness is definitely palpable.
Indeed this uneasiness, this sense of discomfort, has been more visible, ever since the producers imposed embargo on selling oil to the West. That was in the immediate aftermath of the Yom Kippur War in 1973. However, the producers have been over cautious ever since. Despite some undercurrents and one can't deny those, oil has not been used as weapon by the producers, since the embargo was lifted in 1974. Most pragmatists in the region now concede that in the current changed environment, the very notion of using oil as weapon is at best a romantic notion and indeed impractical. With most producers' still living with a "single product" economy, oil is their lifeline. They can't survive without selling black gold. They need the oil revenues to meet their rising expenses.
And any such embargo might also not have the desired impact. The intensity that oil carried in economic terms in the 70s has undergone a massive transition. Any such embargo would not carry the same weight as it did in 1973. Yet, the fact remains that in the post-73 era, for the first time in recent political history, producers too appeared to be carrying some clout - political & economic - on the global stage. And interestingly that is not palatable to some.
And there is a push - and a definite one - to use the oil weapon to deny the Arabs and Muslims of their crude power - by religiously promoting and pursuing green technology and stressing non-traditional, non-fossil fuel to replace oil. This is politics and not economics - indeed with disastrous consequences.
While speaking at the recent annual conference of the American Israel Public Affairs Committee, the most powerful pro-Israel lobby group in the United States, with senior US officials lending their ears, including Secretary Hillary Clinton, Israel's Infrastructure Minister Uzi Landau came up with a new strategy - green technology to cripple the main oil-producing states. By breaking the stranglehold that Iran, Saudi Arabia and other oil-rich states have over the industrialized world (courtesy of black gold), Landau reasons Israel and its strategic ally, the United States, would immeasurably weaken these states and leave them unable to support terror groups. This is oil politics from the other side.
In place of oil as the prime source of energy, Landau sees building Israel into a green technology powerhouse in the Middle East and urged the United States to join it in this endeavor. And he has the weight of Israeli Prime Minister Benjamin Netanyahu behind him.
In October 2009 Netanyahu launched a "national project" at Israel's National Economic Council to find a way to end the world's (and not Israel's) dependence on fossil fuels. "Dependence on fossil fuels strengthens the dark regimes that encourage instability and fund terror with their petrodollars," he declared.
The liberal Israeli daily Haaretz, has reported Netanyahu hopes that developing eco-friendly green technology will also allow Israel to strengthen ties with China, which will one day challenge US economic power and, unlike the West, has no real interest in the Israeli occupation of Palestinian land.
"Although Israel has developed new solar energy and water technologies, Mr. Netanyahu is reported to be stressing a revolution in fuels used in transport, which accounts for a large proportion of oil use," Israel based British analyst Cook observed. "Israeli companies are already involved in researching battery technologies for cars," even though the country has a poor record on using renewable energy sources.
There are, Cook says, "strong indications that Israel's green technologies drive is related to plans developed by US neoconservative groups in the buildup to the attack on Iraq." According to Cook, some of these groups lobbied the George W. Bush administration "to invade Iraq so that the oil fields could be privatized and the international markets flooded with oil." The Heritage Foundation, a major pro-Israeli think tank in Washington, reasoned that privatization would drive down oil prices and shatter the Organization of Petroleum Exporting Countries. Cook notes that at a debate in February on ending the world's oil dependency at Israel's annual national security convention in Herzliya, near Tel Aviv, a leading US neocon, R. James Woolsey, director of the Central Intelligence Agency from 1993 to 1995, called for the OPEC cartel's destruction.
The US occupation of Iraq, however, did not proceed as the neocons expected. The Iraqi oil fields remain in state hands. US Big Oil did not move in to take over the country's vast oil reserves. Instead, non-American oil companies have production contracts to develop them.
No one indeed today argues the issue of green technology. It is definitely required to complement the existing sources of energy. Saudi Arabia is also endeavoring to contribute too. But when the technology is promoted with sinister designs, the consequences could be disastrous, one has to concede and emphasize. When the nudge is for political reasons, for advancing the political objectives of a certain section of people, it assumes a completely different perspective.
If the Arab oil embargo distorted the energy dynamics - this current nudge could not be any different - and needs to be countered at all cost. Oil industry has long been a victim of non-fundamentals - and if heed is paid to this call - it again introduces another non fundamental to the entire global energy equation. Let the invisible hidden hand continue to drive the energy sector too. Calls - loaded with political connotations - will only distort the markets and will be detrimental to the very growth and development of the industry.
