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Posts Tagged ‘Oil & Gas Pipelines’

All about Oil

At the root of US-Iran rivalry, is the question of who will supply oil and gas to India and China.

Big Oil has the eyes, ears, mind, actions of the world's ruling elite - also in India. (Cartoon by : David Horsey of Seattle Post-Intelligencer; Cartoon courtesy - usj.com. ). Click for larger image.

Big Oil has the eyes, ears, mind, actions of the world’s ruling elite – also in India. (Cartoon by : David Horsey of Seattle Post-Intelligencer; Cartoon courtesy – usj.com. ). Click for larger image.

Big oil

Significant part of global politics in the last 10-15 years has been dictated by three developments. One – Oil reserves in Central Asia and the Caspian Sea. Two – Stagnant oil consumption by the West. Three – Rising oil consumption by India and China. For instance US oil consumption between 1973-2010 has grown from 17 mpd to 19 mpd – with some consumption peaks and demand  collapses.

US-Iran clash

Iran is a rival to Big Oil companies of the US and West, as a supplier of oil and gas to India. Iran can easily and cheaply transport oil from its own oil fields – as well as Central Asian production. Iran can thus completely cut out US and its oil companies from the future of oil business with India and China. Hence, the US-Iran rivalry. The Oil-Dollar Tango on which the US Economy is based for the last 30-40 years, also supports Big Oil.

US would like overland oil from Central Asia to come to India and China through Pakistan and Afghanistan – which are US client states. With this the US can cut out Iran – completely. Pakistan and Afghanistan become key gateways for oil to India and China. Hence, the power struggle in Pakistan between Army, Taliban, and the Pakistani politicians.

China's rising oil imports is supporting high oil prices. (Graphic source and courtesy - bbc.co.uk). Click for larger image.

China’s rising oil imports is supporting high oil prices. (Graphic source and courtesy – bbc.co.uk). Click for larger image.

India-Pakistan story

What will be US role, if India and Pakistan were to sit down and resolve their issues. India-Pakistan troubles in the recent past, must be seen in this light, too.

India is negotiating with a Central Asian-US Big Oil Consortium to bring gas via Afghanistan and Pakistan to India – dubbed as the TAPI pipeline. It is also in discussion with Iran and Pakistan to bring gas from Iran to India via Pakistan – commonly known as IPI pipeline.

India’s choice between IPI-TAPI is crucial – and will take another 5-10 years to resolve. In the meantime, Iran’ has an interesting point of view.

The Iranian diplomat reposed faith in the “rationality” of the Indian leadership (and it) would take the “best decision” to meet the energy needs of (an) economy aspiring to be the world’s second largest. He drew attention to Iranian export options of China and Europe other than India.

“India has to decide how to meet its energy needs. Use of nuclear energy has become questionable after the earthquake in Japan. The demand for fossil energy is bound to increase with long term nuclear power projects on hold in Europe,” sources explained.

Security was a major Indian concern — besides pricing — in the talks on the pipeline that would have been laid across the lawless Balochistan where Islamabad’s writ is non-existent in vast stretches controlled by local tribes.

If (security was a major Indian concern) then how was New Delhi in talks on the Turkmenistan-Afghanistan-Pakistan-India (TAPI) pipeline, they asked. “The (security) concerns that exist about IPI exist with TAPI in which case the source of (gas) supply is also dubious,” they averred.

Bagheri attributed the spread of terrorism in the region to the presence of Nato and US troops. “Countries like US are at the root of terrorism in the region. They first created the terrorist groups and have come to the region now on the pretext of fighting them,” he said. “Terrorism has increased since their arrival.”

He cited UN figures to claim that narcotics production went up four times and was the maximum in areas under the control of British troops in Afghanistan. (via Iran gives up on India, pursues gas pipeline with Pak – Hindustan Times).

What is New Delhi’s strategy in all this. Partly, it is increasing oil production within India. Secondly, is increasing the share of nuclear energy. Third is imports.

As usual, tough choices ahead.

Oil reserves across the world. (Graphic source and courtesy - indiadaily.org). Click for larger image.

Oil reserves across the world. (Graphic source and courtesy – indiadaily.org). Click for larger image.


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