Tag: Energy
Stevenson’s army, April 26
– US will reassure South Korea over nuclear weapons, says WSJ. More background from NYT.
-Speaker McCarthy changed the debt bill to appease members favoring ethanol and set rule avoiding amendments except for one.
– Lawfare reviews book on broken promises to Ukraine over nukes.
– WaPo tells how to build a SCIF.
– USA Today depicts Us evacuations from Sudan.
-Axios discloses Cyber Command/CISA secret operations [scroll to second story]
-Some in DOD happy at Tucker Carlson’s firing.
– US helped Guaido escape to Florida
My SAIS colleague Charlie Stevenson distributes this almost daily news digest of foreign/defense/national security policy to “Stevenson’s army” via Googlegroups. I republish here, with occasional videos of my choice. To get Stevenson’s army by email, send a blank email (no subject or text in the body) to stevensons-army+subscribe@googlegroups.com. You’ll get an email confirming your join request. Click “Join This Group” and follow the instructions to join. Once you have joined, you can adjust your email delivery preferences (if you want every email or a digest of the emails).
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Stevenson’s army, March 23
I am back from a week in Doha when I wasn’t posting, and Charlie is back from a few days away:
Back at my desktop and partway through the accumulated newspapers, here are some links.
– Stimson has a bunch of reports. I especially liked the “Chimera of Technological Superiority” paper.
– Lots of Iraq reflections [today is the 20th anniversary of the start of the US war]. Reporter John Walcott was right. As was Jim Fallows.
– A Marine calls for a more family friendly military personnel system
– SAIS prof Ed Joseph sees a Kosovo deal.
– US News said US intell helped India against China.
– Fred Kaplan assesses the Xi-Putin summit. WaPo notes the absence of a pipeline deal.
– Two views on US aid to Ukraine: surprising success or much too slow.
– NYT analyzes DeSantis foreign policy.
– Max Boot sees return to 1930s GOP foreign policy.
– RollCall notes Biden’s high success rate with Congress.
My SAIS colleague Charlie Stevenson distributes this almost daily news digest of foreign/defense/national security policy to “Stevenson’s army” via Googlegroups. I republish here, with occasional videos of my choice. To get Stevenson’s army by email, send a blank email (no subject or text in the body) to stevensons-army+subscribe@googlegroups.com. You’ll get an email confirming your join request. Click “Join This Group” and follow the instructions to join. Once you have joined, you can adjust your email delivery preferences (if you want every email or a digest of the emails).
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Stevenson’s army, February 14
– NYT says Ukraine order for aid groups to leave Bakhmut may be prelude to its own withdrawal.
– WaPo says US has warned Ukraine of problems sustaining aid levels.
– Politico says US won’t send ATACMs because of US inventory shortages.
– Moldova says Russia planned coup.
– Ian Bremmer doubts US sabotaged Nordstream 2.
– Fred Kaplan explains new search for balloons.
My SAIS colleague Charlie Stevenson distributes this almost daily news digest of foreign/defense/national security policy to “Stevenson’s army” via Googlegroups. I republish here, with occasional videos of my choice. To get Stevenson’s army by email, send a blank email (no subject or text in the body) to stevensons-army+subscribe@googlegroups.com. You’ll get an email confirming your join request. Click “Join This Group” and follow the instructions to join. Once you have joined, you can adjust your email delivery preferences (if you want every email or a digest of the emails).
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Stevenson’s army, February 8
-WaPo reports on China’s vast surveillance programs-
-China’s balloon program was reported last year.
-WSJ reports China now has more ICBM launchers than US, though many are empty.
-SASC Chairman Reed says Ukraine has more urgent needs than F16s
–Russia threatens expulsions of US officials
-FT says Iran is now shipping Russian oil.
-Axios says US asked Israel & PA to “pause” actions.
My SAIS colleague Charlie Stevenson distributes this almost daily news digest of foreign/defense/national security policy to “Stevenson’s army” via Googlegroups. I republish here, with occasional videos of my choice. To get Stevenson’s army by email, send a blank email (no subject or text in the body) to stevensons-army+subscribe@googlegroups.com. You’ll get an email confirming your join request. Click “Join This Group” and follow the instructions to join. Once you have joined, you can adjust your email delivery preferences (if you want every email or a digest of the emails).
– In WOTR, former student urges “learning culture”
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Stevenson’s army, February 1
– Air Force opposes Chinese-owned corn mill
– Ukraine hasn’t boosted US defense firms.
– But CSIS sees problems with US industrial base.
– CSIS also worries about US weapons inventories.
– AP says more weapons going to Korea.
– Reuters says longer-range rockets going to Ukraine.
– Pew sees bigger partisan divide on support to Ukraine.
– US says Russia is violating New Start treaty. In FT, Rose Gottemoeller says this could be fixed.
My SAIS colleague Charlie Stevenson distributes this almost daily news digest of foreign/defense/national security policy to “Stevenson’s army” via Googlegroups. I republish here, with occasional videos of my choice. To get Stevenson’s army by email, send a blank email (no subject or text in the body) to stevensons-army+subscribe@googlegroups.com. You’ll get an email confirming your join request. Click “Join This Group” and follow the instructions to join. Once you have joined, you can adjust your email delivery preferences (if you want every email or a digest of the emails).
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The stab in the back that isn’t
The Biden Administration is portraying Saudi support for the OPEC+ reduction in oil production quotas as as betraying the Saudi-American alliance The Kingdom’s move also appears to align Riyadh with Moscow against Kyiv.
It doesn’t add up
There is a lot wrong with this perspective:
- The Saudis have never been US allies, either de jure or de facto. The relationship inaugurated in 1945 with a meeting between President Roosevelt and Saudi King Abdul Aziz has always been transactional. The US supplied security in exchange for moderate oil prices and reliable supplies. The relationship was not based on shared values or even common security concerns.
- Circumstances have changed. The US was once a major oil importer. It is now a modest net oil exporter. American hydrocarbon companies benefit handsomely from higher oil prices. Saudi Arabia in the 1970s and 1980s had trouble spending all of its oil revenue. It now requires prices of about $100/barrel in order to balance its national budget. Maintaining an absolute monarchy ruling over a much larger population is expensive.
- Saudi Arabia no longer maintains as much excess production capacity as once it did. It is down to perhaps 2 million barrels per day above current production levels. That is small compared to its previous excess capacity of 4 million barrels per day or more. This is in part due to the privatization of part of Aramco. That required the company to behave more like a profit-seeking enterprise rather than a a state-subsidized one.
- Oil around $100/barrel is required for the transition away from hydrocarbons. The many alternatives to oil and natural gas are far more competitive if the price of oil is high. You won’t be hearing this from the Green New Deal folks, but they know their interest in moving the US away from climate-changing carbon dioxide requires higher oil prices, not lower ones.
National interests prevail
What we are seeing is not a stab in the back, but a convergence of Saudi, Russian, and Iranian interests in higher oil prices. Riyadh, Moscow, and Tehran are all frightened that the impending slow-down in the world economy will lead to dramatic cuts in oil prices. Reducing production first serves their national interests.
The Americans are seeing all issues through Ukraine-tinted glasses. But others do not. Riyadh has made it clear it does not regard the Ukraine war as one in which it has a vital interest. This is not surprising. Even if the Kingdom did regard Ukraine as vital, why would an absolute monarchy with no regard for human rights favor Zelensky over Putin?
What is to be done?
The question is how the US should react. Proposals so far include continuing drawdown of the Strategic Petroleum Reserve (SPR), allowing lawsuits against OPEC for price-fixing and cutting arms sales to Saudi Arabia.
Continuing drawdown of the SPR makes obvious sense. Its one million barrels per day have moderated oil prices since the Russian invasion of Ukraine. The drawdown also returns substantial profits to the US Treasury (average acquisition price was about $30/barrel).
Cutting arms sales to the Kingdom doesn’t pass muster as a good idea. Riyadh will turn to others–read Russia or China or both–less fastidious about the conditions imposed. The Saudis like high tech American weapons. But they don’t really need them compete militarily with Iran, their only serious potential adversary in the region.
“NOPEC” legislation pending in Congress would allow lawsuits in the US against OPEC and OPEC+ for anti-competitive behavior. It is not clear that such lawsuits would be successful, or that they would lead to successful remedies. Nor would it likely improve relations with the Saudis. But at least this approach is consistent with US policy on monopolies and does not empower US adversaries.
Another approach, one politically less palatable, is to wait and see. If OPEC+ manages to maintain high oil prices, that will presumably incentivize alternatives worldwide. It won’t help the Democrats in the November election, but at least it is something the Biden Administration supports. If the world economy slows dramatically and prices either remain at current levels or fall, Biden will also have the last laugh.
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