Abstract: This research article delves into the geostrategic pursuits of national governments which guise competitive negotiations in the name of pursuing universally envisioned goals of energy cooperation and sustainability – while deliberating at the international energy fora. The logic behind this geopolitical behaviour is the extent of availability of naturally-endowed energy resources – both conventional and renewable – within their territorial realms. This resource-abundance enables the Commanding countries to give idyllic hopes and aspirations of energy trade and thereby, energy security to the resource-deficient/ Compliant countries. Contradictorily, the former countries simultaneously pursue their unilateral competitive energy policy goals focusing on their national energy security – regionally and internationally. This contravening, fuzzy and hyper-cyclical nature of energy negotiations to give in to the national energy security interests has been observed – to be epiphenomenal to the universally envisioned energy goals – in both Commanding and Compliant countries’ international negotiations.
The world is at a transcendental stage of global energy governance where national and continental boundaries have become indistinct and universal ideals of cooperation have acquired the center-stage. Unlike other international governance arenas of health, food, peace-security and environment which have a well-defined institutional structure and charter, the case for Energy is an antithesis[1]. There is an absence of an over-arching international energy organization to govern the policy landscape. This is the foundational systemic logic behind why (to attain geopolitical and global predominance through energy prowess) and how (through energy trade and policy negotiations) do national governments strategize their envisioned energy pursuits in the international energy negotiations and deliberations.
The anarchical roots behind the cause of truancy of a constitutional energy-governing organization is the race between Commanding and Compliant countries to acquire predominance in regional, continental and world energy affairs. This is the reason behind why major conventional energy-rich countries do not accede easily to international energy organizations. Their apprehensions about the onset of privatization, international investments and encouraging renewable energy, world-over and within their territorial domains, would minimize their regional and global predominance of being global power centres. Those which have an abundance of conventional energy resources feel that their international markets could easily get siphoned-off if renewable energy gains recognition and production momentum. Similarly, apprehensions of the energy-deficient countries, at the other end of the scale, relate to succumbing to the continued sustenance of powerful conventional energy-rich countries dominating world energy affairs.
The accession or non-accession of major oil-producing countries to international energy organizations underscores a lack of consensus between energy-producing and energy-consuming countries on the collective/ idealized goals of universal energy access, national economic development and environmental sustainability. Both sides put their national and regional interests in focus vis-à-vis these idealized objectives which could potentially favour their security and the over-arching environmental interests. Decisions of accession or non-accession also demarcate their relative geopolitical standing and capacity to act as a major, dependable energy power which could act as a reservoir of energy in times of shortages owing to political discords, diplomatic embargoes and production shortages.
Examples of accession of select countries into the early years of the General Agreement on Tariffs and Trade (GATT)[2] include Indonesia, Venezuela, Kuwait, Nigeria and Venezuela– 1950s onwards. The ones which acceded at a later stage after the mid-1990s include United Arab Emirates, China, Angola, Oman, Russia, Qatar and Saudi Arabia. The latter list of energy-producing and exporting countries is symbolic of the above-mentioned apprehensions which took four decades long to participate as members in the international fora. The national governments in these countries have socialist political backgrounds with the energy sector being nationalized and state-owned. Not only do these countries heavily invest in the development of their energy sector, these have huge markets in the European Union (EU) and the Americas. Apprehensions of the energy-dependent countries underscore energy insecurity if diplomatic or political policy tilt against the Commanding ones is observed at the regional or international energy negotiations fora.
These accessions also showcase the inter-linkage of energy trade rules with those of the GATT objectives[3]which led these both country types to deliberate on frameworks of trade of energy goods and services[4]. In the initial years, liberalization of trade of energy goods and services was never discussed because of the unilateral interests of the energy-producing and exporting countries. However, with the onset of concerns on climate change, risk mitigation of energy leakages, privatization and foreign investments into the national energy sector of member countries, the tables turned.
The 1990s brought in the promise of laissez-faire trade potentials, the Kyoto Protocol favoured reduced carbon emissions, the United Countries Conference on Trade and Development[5] (UNCTAD) encouraged international energy investments and the International Renewable Energy Agency (IRENA) led by the United States looked up to the development and governance of renewable energy goods and services. These developments instilled idyllic hopes for the compliant and dependent energy-importing countries to develop renewable energy and minimize their dependence on the energy-exporting countries which influence and command the international energy negotiations.
Renewable energy development was seen as a potential hedge against the unruly exporting countries. Countries like those of the European Union, the United States of America, Asia and Africa started developing their renewable energy base to ensure predictable, unhindered energy supply for their developmental and industrial activities along with meeting the needs of household electrification and cooking fuels. However, the case of South America is different. Series of civil wars, intra-regional and border disputes, unwilling national governments to collaborate with neighbours, structural incapacities, socialist governments and lower levels of economic growth have all led to the continent staying aloof from the developmental activities of conventional and renewable energy resources.
While there are several international and regional organisations that cater to conventional and renewable energy production, distribution, management and governance, lack of an international institutional architecture thereof signals privation of political will, structural economic incapacity and intra- and inter-national disputes. This is also the reason why abrupt disruptions in energy supply take place between countries – owing to their trans-border transmission discords, diplomatic and economic embargoes, preference of energy trade with friendly countries and militarized choking of regional neighbours from access to strategic air, land and sea ports to ship or receive energy supplies.
Trends observed since the second half of the twentieth century depict how exporting and importing countries negotiate and cooperate, geostrategically, on lines of universally idealized goals of energy development, access and secure supply to all, but selectively accede to and participate in international energy affairs.[6] Not only does this Power-Energy-Trade nexus impedes the equal and secure energy access to all countries globally, it also creates national and regional pockets of wealth accumulation by the rich, developed, producer-countries at the cost of the developing, importer countries.
History showcases several remarkable events whereby such Tactical Interventions[7] have taken place to establish and maintain energy prowess and security in regional and international geopolitical trade and negotiations. These interventions include: (i) providing assistance to friendly countries by sharing technical expertise and energy supplies, (ii) depriving markets from accessing energy supplies, (iii)disrupting of energy export supplies transmission and distribution inter-nationally, (iv) dumping markets with excess supply to avoid competition and export excessive production, (v) restricting energy production capacity to markets with desperate need due to hostile or disagreeable political environment, as well as (vi)blocking of energy exports whereby energy-rich countries are denied market access to energy trade.
These tactical historical events whereby both energy-exporting and importing countries conduct geopolitics at the cost of environmental instability and universal energy access, include:
The 31st G8 Summit[8] held in Scotland in 2005 when the developed, energy-rich countries – like the Russia, United States, United Kingdom, Germany, Canada, Italy, Japan and France –extended invitation to developing countries like China, India, Mexico, Brazil, South Africa, which are fast-paced economies that need energy for industrial development. It was a strategic move by the former to exchange their high carbon footprints in lieu of clean energy technology transfer to the latter for their developmental purposes.
Similarly, in 2007, World Bank introduced efforts on establishing the Investment Framework for Clean Energy Ministerial[9]aimed at addressing the concerns of energy insecurity, dual oil-pricing, market and technical risks of the developing countries through private investment, capacity-building, technical knowledge sharing and developing alternate energy fuels to cater to their developmental requirements.
IRENA’s Renewable Revolution[10], 2019, aimed to address energy-importing Asian, African and European Union Countries’ concerns of green-house gas emissions, fossil-fuel dependence, dependence on fossil-fuel exporters, etc. by focusing on their local/ regional dynamics of harnessing renewable energy resources for household electrification and industrial needs to achieve sustainable development.
European Union’s[11] hedge against the Russian gas leverage is another example. Russia created transport disruption of its gas supplies to the EU during the Crimean Crisis in response to the trade embargoes levied on it by the EU. Thereafter, EU, which was heavily dependent on the Russian gas, had to develop technology to harness renewable energy to hedge against the unpredictable supplies, energy insecurity and dependence on conventional fuel supplies.
Similar is the case of Saudi Arabia’s non-adherence to the OPEC+ Group’s set production quotas to limit the monopolistic production, supply and environmental damages. The Arabian reduction in energy production levels could have meant Russia making advances to the OPEC international and regional markets as the next major player. Therefore, in order to eliminate the risk of Russia, the OPEC region’s other major gas supplier, entering the market, Saudi Arabia did not adhere to the collectively decided quotas. The OPEC countries were, similarly, indifferent to the energy and trade requirements of the petroleum-importing nations because of their preoccupation with wealth-accumulation from oil-trade. They suppressed the creation of a cartel of the petroleum importing countries, viz., Organization for Petroleum-Importing Countries (OPIC) – which had the potential of challenging the OPEC trade predominance in future.
Other prevalent historical examples of competitive and countrified actions include blocking and capturing of geostrategic territorial borders, air and sea-ports from and through which international energy exports and imports take place, performing strategic oil fires and spills, etc. Iranian Oil Terminals of the Kharg Island, Iraqi Port Terminals of Basra, Al Faw and Umm Qasr, as well as the closing down of the Kirkuk-Baniyas Pipeline are such examples of the 1980-88 Iran-Iraq War.In addition, the intervention of the US Army and Navy in Wars like Iran-Iraq War, Iraqi Invasion of Kuwait in 1990, 1991 Gulf War, etc. denotes the interference created by the energy-rich countries which try to influence in the status quo between regional neighbours by acting as a supreme authority by virtue of their territorial energy-abundance.
These historical events depict the status quo and discombobulations between Commanding and Compliant countries’ actions in the name of cooperative policy pursuits vis-à-vis their respective statuses of energy availability and thereby, security. Both country types have been observed to be negotiating and making policies in silos by not adhering to the collectively idealized sustainable energy goals and concerns of environmental degradation, economic disadvantages, energy insecurity and unaffordable energy access, etc. faced globally.[12]
At the other end of the scale, this contemporaneous era of influencing and getting influenced on global energy matters is also marked by the Era of Extreme Energy[13] and energy abundance. Herein, discoveries of shale gas, tar sands, Arctic oil and gas exploration, etc. have all paved way for a transitional shift from conventional to renewable energy resources. Thereby, creating an altogether newer geopolitical dynamic at play wherein countries with renewable and mixed energy resource-base are able to reckon with the erstwhile energy-producing influential countries.
Idyllic Hopeslay far behind actual inter-national practices. The aspirations of renewable energy development and related prospects of minimizing climate change risks, reducing green-house gas emissions and providing sustainable and affordable energy universally are a distant dream vis-à-vis the reality of the producer-countries’ countrified actions to not adhere to these universally envisioned energy goals – despite drawing global international frameworks like Kyoto Protocol, United Nations Sustainable Development Goals, Group of 8 Summits, establishments of international organizations like IRENA, etc. to focus on renewables.
However, the developmental and industrial-base shifts from America and Europe towards Asia and Africa mark the beginning of a new era of renewable energy. IRENA’s Global Commission on Geopolitics of Energy Transformation[14]also conforms to this new shift towards the renewables wherein the growth of countries as new global leaders will mark the onset of encouraging, developing and using renewable energy which has a huge potential in mitigating climate change risks, reducing green-house gas emissions and providing sustainable and affordable electricity to all nations and its people.
As observed, the discombobulating geostrategic policy pursuits of both Commanding and Compliant countries include select participation and membership to the international energy organizations, exchanging/ buying carbon footprint trails with technical expertise, non-adherence to set production quotas, political, military and diplomatic interventions in energy trade, etc. The country-types have only had one prime agenda – of being energy secure, have a say in regional energy governance and policy pursuits, as well as continued reliable source of energy supply through either conventional, renewable or mixed resource basket. Leaving behind the ideals of sustainability and development, their focus area has been national economic/ trade progress and prevalence and to be a continued supplier to international markets.
Contrary to these disconcerting activities are the ideals and practices of sustainable development, universal energy provision, minimal green-house gas emissions, cooperative international energy dialogues and policies, as well as technology-sharing. These are the way forward for the country-types which could actually act to mitigate energy-related concerns globally. It is now at the behest of these participating countries that they join hands with one another – in favour of the populace, the environment and for themselves – to make these idyllic hopes into historical reality. The geostrategic policy pursuits of Commanding and Compliant countries could be given a backseat to come out of the never-ending vicious cycle created and maintained by the energy-rich countries to continue reaping financial and diplomatic advantages.
The conjecture of the undertaken research can be narrowed down to specific levels of trade and commerce, geopolitics, concerns for striking environmental balance and nations’/ people’s access to energy for household electrification and developmental activities. The gamut of striking a balance between all these levels is paradisal as nations – whether Compliant or Commanding – would always have their unilateral interests to cater to while negotiating energy policies and goals at the international level. This unilateralism is also the logic behind their select participation which has led to the non-fulfilment of the over-arching, idealized and envisioned universal goals of energy prosperity and that of an international energy organization for global governance.
On one hand, the energy-abundant/ Commanding nations have favoured increased energy production, span of international exports and markets, as well as accumulation of energy wealth by virtue of their geographical advantage. On the other hand, the energy-deficient/ Compliant nations have favoured a secure and predictable energy supply for their populace along with reduced trade and inter-related diplomatic dependence on the former nations. This is, therefore, a symbiotic relation between the Commanding and the Compliant nations which cannot work their way up towards their prosperity unless they join hands with one another. Though their respective unilateral interests would always be their prime negotiating agenda, they cannot quash the other side’s geopolitical, commercial and environmental requirements into oblivion.
Tanya Kapoor is a Doctoral Researcher at the Centre for International Politics, Organization and Disarmament in the School of International Studies, Jawaharlal Nehru University, New Delhi. She completed M.A. in Politics with specialisation in International Relations and further specialized in International Organizations at the M.Phil. level from the same School and University. Her major area of research concentration has been Energy Trade and Energy Geopolitics since then. Her M.Phil. Dissertation revolved around delving deeper into the Interface between International Energy Trade and Deliberations at the World Trade Organization. She has a keen interest in Diplomatic and Area Studies with a prime focus on Energy Geopolitics. She also researched on the Indo-Bhutan Hydro-power Cooperation for the NITI Aayog in 2013 as part of the intern research team in the Power and Energy Division.
[1]Mohammed ElBaradei, “A Global Agency is Needed for the Energy Crisis”, Financial Times, July 23, 2008.
[2]Wen-Chen Shih, "Energy Security, GATT/ WTO, and Regional Agreements", Natural Resources Journal 49 (2009): 433.
[3]United Countries Conference on Trade and Development (UNCTAD), The History of UNCTAD 1964-1984, United Countries Secretariat (New York: UNCTAD, 1985).
[4]Raphael Leal-Arcas and Ehab S. Abu Ghosh, “Energy Trade as a Special Sector in the WTO: Unique Features, Unprecedented Challenges and Unresolved Issues", Indian Journal of International Law 6 (2014): 1.
[5] United Countries Conference on Trade and Development, Trade Agreements, Petroleum and Energy Policies (New York: UNCTAD, 2000).
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[7]Pascual Carlos, The New Geopolitics of Energy (New York: Centre on Global Energy Policy, Columbia University, 2015).
[8] Nicholas Bayne and Robert D. Putnam, Staying Together: The G8 Summit Confronts the 21st Century (England: Ashgate Publishing, 2005).
[9]World Bank, Clean Energy for Development Investment Framework: The World Bank Group Action Plan March 6, 2007 (Washington DC: Sustainable Development Network, 2007), 1-52.
[10]International Renewable Energy Agency (IRENA) (2019), Global Commission Describes New Geopolitical Power Dynamics Created by Renewables (Abu Dhabi: IRENA, 2019).
[11]Franziska Müller, "IRENA as a Glocal Actor: Pathways towards Energy Governmentality", Innovation: The European Journal of Social Science Research 30 (2016): 306-322.
[12]Dickel, Ralph, "Trade and Investment in Global Energy: A Policy Perspective", in Global Energy Governance: The New Rules of the Game, ed. Andreas Goldthau and Jan Martin Witte (Berlin: Brookings Institution Press, 2010).
[13]Michael T. Klare, The Race for What’s Left: The Global Scramble for the World's Last Resources, (New York: Metropolitan Book, 2012).
[14]International Renewable Energy Agency (IRENA) (2019), Global Commission Describes New Geopolitical Power Dynamics Created by Renewables (Abu Dhabi: IRENA, 2019).