Oil 1 Peak Oil 21
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AT: RELATIONSNO RISK OF NEGATIVE IMPACTS TO SINO-SAUDI RELATIONS. COOPERATION WITH US MORE LIKELY Nawaf Obaid, The Gracia Group, “The Sino-Saudi Energy Rapprochement:Implications for US National Security January 8th, 2002 http://www.rice.edu/energy/publications/docs/SinoSaudiStudyFinal.pdf
Vladimir Radyuhin writer for Business Daily from THE HINDU group of publications Jul 15, 2008 “High oil prices and Russia’s problem of indigestion” http://www.thehindubusinessline.com/2008/07/15/stories/2008071550160800.htm At a time when India struggles with the soaring crude import bill, Russia’s problem is how to absorb windfall oil revenues and avoid indigestion. Just over a decade ago, oil was trading at around $10 a barrel; last week, it shot through $147 for the first time. Russia pulled ahead of Saudi Arabia in June as the world’s top crude oil producer; it has been for years the second biggest oil exporter and the biggest natural gas exporter. Petrodollars are flowing in at a breathtaking pace: Russia earns over $800 million a day from the export of oil and gas, or $560,000 every minute. Oil windfall. The mind-boggling oil windfall has driven Russia’s impressive economic growth. Ten years ago, it was a $200-billion economy; this year it has crossed the $1.4-trillion mark. Russia’s per capita gross domestic product has quadrupled to nearly $7,000. Today, Russia is the eighth largest economy in the world in Purchasing Power Parity (PPP), according to the World Bank. By the end of the year, it will overtake France to become the world’s sixth largest. Last year, foreign investment surged by a factor of 2.5 to touch $100 billion — a record growth for any of the world’s 15 leading national economies. Petrodollar glamour. Signs of newly found wealth strike the eye in Russia’s major cities. Moscow is one of the most expensive cities in the world. It is a showcase of petrodollar glamour, with world-class restaurants, nightclubs and super-expensive boutiques. Moscow has knocked off New York as the world’s top city for the number of resident billionaires. Some analysts say that Russia is now the fourth largest consumer of luxury goods in the world, after the US, Japan and China. Moscow’s congested streets are filled with late-model BMWs, Mercedes and Bentleys. As oil wealth trickled down the other sectors of the economy, about 20 million people have been lifted out of poverty. Average earnings have been growing by around 20 per cent a year, fuelling an unprecedented consumption boom. Mega-malls crammed with goods from all over the world are mushrooming in Russian cities. Russia has overtaken Germany this year as Europe’s biggest car market, and demand outpaces supply: Russians sometimes have to wait 12 months and more to get a car of their choice. energy superpower The oil boom has brought Russia more than economic prosperity. It has made Russia an energy superpower. Restoring government control over oil and gas privatised by his predecessor, Boris Yeltsin, former President, Vladimir Putin, wielded energy resources as a modern equivalent of military power, rebuilding Russia’s global clout and influence. Moscow has consolidated its hold on oil and gas flows from Central Asia, tied Europe firmly to Russian energy supplies, and won access to Western technologies. Russia’s economy has been growing at 6-8 per cent a year in the new century, but it has still found it hard to digest gushing cash flows. Four years ago, the government set up a Stabilisation Fund to sop up oil duties and oil extraction taxes levelled above the cut-off price of $20 per barrel. By the end of last year, the oil fund, designed to save the energy windfall for a rainy day and to prevent it from distorting the rest of the economy, rose to $160 billion. Russia has also built up the world’s third-largest foreign exchange reserves, which have swollen from $12 billion in 2000 to over $500 billion today. Stabilisation Fund. Even as the Stabilisation Fund helped sterilise excessive cash, it has been widely criticised for failing to address the strategic goal of diversifying Russian economy away from overdependence on oil and gas. More than 60 per cent of federal budget revenues still come from oil and gas taxes. 2. Alternative energy would crush Russian oil prices Robert Reno writer for Newsday April 7, 96 MONEY & CAREERS; Pg. F08 “ 'Fixing' the System That Is to Care For An Aging Nation” http://w3.lexis.com/lawschoolreg/researchlogin08.asp?t=y&fac=yes Lexis IF SCIENTISTS discovered tomorrow that a clean and safe source of infinitely renewable energy could be cheaply derived from, say, ordinary sea water, we all know it would be an unmitigated boon for mankind. Well, not exactly. Because any such invention would necessarily cause a collapse of oil prices, and Texas, Louisiana and Oklahoma would become basket states. In Mexico, where petroleum is the chief national patrimony, the floor under a fragile economy, would disintegrate. The Middle East would become a destabilized mess as oil-rich regimes lost the resources through which they now control their populations. Russia and the many former constituent republics of the Soviet Union would lose export earnings critically important to the survival of their democracies. Billions invested in the extraction of North Sea oil would lose its value. Ripple effects running through the financial system as a result of the downsizing and bankruptcy of much of the existing oil industry are simply too terrifying to contemplate. 3. Russian economic decline results in nuke war Steven R David professor of political science 99 professor of political science at the john Hopkins U, Foreign Affairs, January/February. AT NO TIME since the civil war of 1918 -- 20 has Russia been closer to bloody conflict than it is today. The fledgling government confronts a vast array of problems without the power to take effective action. For 70 years, the Soviet Union operated a strong state apparatus, anchored by the KGB and the Communist Party. Now its disintegration has created a power vacuum that has yet to be filled. Unable to rely on popular ideology or coercion to establish control, the government must prove itself to the people and establish its authority on the basis of its performance. But the Yeltsin administration has abjectly failed to do so, and it cannot meet the most basic needs of the Russian people. Russians know they can no longer look to the state for personal security, law enforcement, education, sanitation, health care, or even electrical power. In the place of government authority, criminal groups -- the Russian Mafia -- increasingly hold sway. Expectations raised by the collapse of communism have been bitterly disappointed, and Moscow's inability to govern coherently raises the specter of civil unrest. If internal war does strike Russia, economic deterioration will be a prime cause. From 1989 to the present, the GDP has fallen by 50 percent. In a society where, ten years ago, unemployment scarcely existed, it reached 9.5 percent in 1997 with many economists declaring the true figure to be much higher. Twenty-two percent of Russians live below the official poverty line (earning less than $ 70 a month). Modern Russia can neither collect taxes (it gathers only half the revenue it is due) nor significantly cut spending. Reformers tout privatization as the country's cure-all, but in a land without well-defined property rights or contract law and where subsidies remain a way of life, the prospects for transition to an American-style capitalist economy look remote at best. As the massive devaluation of the ruble and the current political crisis show, Russia's condition is even worse than most analysts feared. If conditions get worse, even the stoic Russian people will soon run out of patience. A future conflict would quickly draw in Russia's military. In the Soviet days civilian rule kept the powerful armed forces in check. But with the Communist Party out of office, what little civilian control remains relies on an exceedingly fragile foundation -- personal friendships between government leaders and military commanders. Meanwhile, the morale of Russian soldiers has fallen to a dangerous low. Drastic cuts in spending mean inadequate pay, housing, and medical care. A new emphasis on domestic missions has created an ideological split between the old and new guard in the military leadership, increasing the risk that disgruntled generals may enter the political fray and feeding the resentment of soldiers who dislike being used as a national police force. Newly enhanced ties between military units and local authorities pose another danger. Soldiers grow ever more dependent on local governments for housing, food, and wages. Draftees serve closer to home, and new laws have increased local control over the armed forces. Were a conflict to emerge between a regional power and Moscow, it is not at all clear which side the military would support. Divining the military's allegiance is crucial, however, since the structure of the Russian Federation makes it virtually certain that regional conflicts will continue to erupt. Russia's 89 republics, krais, and oblasts grow ever more independent in a system that does little to keep them together. As the central government finds itself unable to force its will beyond Moscow (if even that far), power devolves to the periphery. With the economy collapsing, republics feel less and less incentive to pay taxes to Moscow when they receive so little in return. Three-quarters of them already have their own constitutions, nearly all of which make some claim to sovereignty. Strong ethnic bonds promoted by shortsighted Soviet policies may motivate non-Russians to secede from the Federation. Chechnya's successful revolt against Russian control inspired similar movements for autonomy and independence throughout the country. If these rebellions spread and Moscow responds with force, civil war is likely. Should Russia succumb to internal war, the consequences for the United States and Europe will be severe. A major power like Russia -- even though in decline -- does not suffer civil war quietly or alone. An embattled Russian Federation might provoke opportunistic attacks from enemies such as China. Massive flows of refugees would pour into central and western Europe. Armed struggles in Russia could easily spill into its neighbors. Damage from the fighting, particularly attacks on nuclear plants, would poison the environment of much of Europe and Asia. Within Russia, the consequences would be even worse. Just as the sheer brutality of the last Russian civil war laid the basis for the privations of Soviet communism, a second civil war might produce another horrific regime. Most alarming is the real possibility that the violent disintegration of Russia could lead to loss of control over its nuclear arsenal. No nuclear state has ever fallen victim to civil war, but even without a clear precedent the grim consequences can be foreseen. Russia retains some 20,000 nuclear weapons and the raw material for tens of thousands more, in scores of sites scattered throughout the country. So far, the government has managed to prevent the loss of any weapons or much material. If war erupts, however, Moscow's already weak grip on nuclear sites will slacken, making weapons and supplies available to a wide range of anti-American groups and states. Such dispersal of nuclear weapons represents the greatest physical threat America now faces. And it is hard to think of anything that would increase this threat more than the chaos that would follow a Russian civil war. Directory: file -> view view -> Western Europe after wwii view -> Author study: paul fleischman view -> Qpa1 7ela study Guide view -> Arctic Oil/Gas Neg view -> November 1970 Approximately 150,000-500,000 deaths Bhola Cyclone Bangladesh view -> Grade Level: 6 Unit of Study: Caribbean glce view -> Citation: Duffield, Katy view -> Table of Contents Lesson # view -> Chinese Wind Energy Disad Download 9.54 Mb. Share with your friends:
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