THE VINE APRIL 16, 2010
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Many observers were puzzled last week when President Obama announced his support for expanded offshore oil drilling. Was he trying to win over Republican swing votes for a climate bill? Head off the inevitable anger over summer gas prices? Perhaps. But here's another possibility: The move could have been intended to bolster international support for sanctions on Iran. At least that's what events from the nuclear summit earlier this week suggest.
On Monday, Obama apparently convinced Chinese President Hu Jintao to pursue sanctions as a means of dissuading Iran from developing its nuclear program. As Time noted, "Obama reportedly indicated that the U.S. would help China make up any shortfall in oil imports resulting from Iranian retaliation for any Chinese support for sanctions." China is concerned about its growing reliance on crude imports and possible disruptions in the global oil markets. So Obama's offshore-drilling embrace may have been intended to signal that he's doing everything possible to avoid that fate.
Of course, it's worth examining just how much offshore drilling can achieve here. Iran, after all, plays a huge role on the international oil markets—with estimated reserves of 130 billion barrels and daily production of 3.8 million barrels. By contrast, the offshore-drilling areas that the Obama administration is now studying off Alaska and the mid-Atlantic region are estimated to contain, according to the Interior Department, 62.6 billion barrels of economically recoverable oil at most. What's more, that oil isn't all coming out tomorrow: A 2007 study from the Energy Information Administration suggested it will take at least five years before U.S. offshore oil drilling can begin.
In all, according to Steven David of Johns Hopkins, expanding U.S. oil production "could help around the edges" to blunt any Iranian reaction to eventual sanctions. But, David adds, offshore drilling in the United States wouldn't have nearly as big an impact as other oil-production moves elsewhere in the world—such as encouraging Saudi Arabia to boost its production or convincing Mexico to develop its oil reserves in the Gulf.
Then again, offshore drilling isn't the only domestic policy Obama's pursuing here. The stricter fuel-efficiency standards recently announced by the administration will add some near-term slack to the oil markets. The government estimates that increased mileage standards will save a total of 1.8 billion barrels of oil by 2016. If all those savings aren't guzzled up elsewhere, then the United States could theoretically replace nearly half of the current Iranian reserves by the midterm of the next administration. That could have helped Obama convince Hu to take a harder line on Iran's nuclear program without being quite so afraid of the ramifications for the oil markets.
It's also worth noting that, regardless of how Iran reacts in response to further sanctions, the country's oil production is likely to continue to decline. Before its oil industry was nationalized in the 1979 revolution, Iran was producing about five million barrels per day. More recently—thanks in part to the effects of sanctions—the country is down to about three million barrels per day. This has led some experts to question whether Iran's reserves are even as large as claimed. Dr. Samsam Bakhtiari, a former executive at the National Iranian Oil Company, suggests that Iranian estimates are “almost one hundred [billion barrels] over any realistic assay.”
Corbin Hiar is a freelance writer in Washington, D.C.
(Flickr photo credit: State Department)
9 comments
Interesting article, but I think this is a stretch, for two reasons. First, the proximate cause of Pearl Harbor was the effective US strangulation of Japanese resources imports. The event was traumatic and underlined the precarious position of all Asian economies when it came to resources. I seriously doubt that China would be willing to subject its energy requirements to the vicissitudes of offshore oil exploration in the US. China will suck Iran dry and find other sources when Iran no longer has any oil - but this is in about twenty years, at the earliest, and by that time, Iran's vast natural gas reserves should be online. Second, it gives too much credit to this - or any - Administration to have such a far-reaching and all encompassing Grand Strategy. This is the kind of analysis that my conspiracy theorist cousins in Iran come up with. In this, as with many policies, the simplest explanation is usually the best: domestic political considerations. As for China's give on Iran - when it happens, I will rejoice, but not before.
- icarusr
April 17, 2010 at 5:32pm
I agree, this is pretty far fetched. Another point against it is that Democrats tend to address foreign policy issues on a micro level, tinkering with diplomatic issues on a case by case basis. Republicans tend to pursue global strategies where actions in all regions are supportive of one overreaching goal. Neither strategy has been effective in dealing with the middle east, which was why some middle east experts were excited about Obama's approach - a regional strategy along George H.W Bush's model which had yielded some fruit in the early 90s. There's no reason to think Obama would switch to a global strategy after only a year of the regional approach.
- Maxblum13
April 17, 2010 at 6:26pm
ick: First, "the proximate cause of Pearl Harbor was the effective US strangulation of Japanese resources imports?" THE proximate cause? C'mon don't call someone's idea a stretch, and then by analogy compare it to a pseudo-similar event, and then put forth the simplicstic idea that you can define that event so succintly. While I would doubt any country will ever deal selflessly, I cannot imagine that the Chinese might not be swayed by a larger picture as well. Second, "it gives too much credit to this - or any - Administration to have such a far-reaching and all encompassing Grand Strategy." And you give too little credit to imagination. Must there be a disconnect from long term and short term goals? I find that depressing if so. Lastly, "As for China's give on Iran - when it happens, I will rejoice, but not before." Agreed.
- jmarshall
April 17, 2010 at 11:35pm
Jmarshall: I'm in the middle of reading Michael Frayn's "The Human Touch" - specifically, the chapter on Cause and Effect. I hesitated before putting the words "proximate cause", but went ahead any way. It is (over)simplifying a complex causal relationship, to be sure, but I am not entirely certain that it is all that inaccurate. Be that as it may, even if you remove the first sentence, I submit that the rest remains valid. China's strategy is defined by its national interest; it's bigger picture is set as against that interest and not that of the West. China should be concerned about the threat a nuclear Iran poses to the Persian Gulf oil, but it appears to be rather blase about allowing its client states to shop nuclear materials and know-how to Iran; it is remarkably sanguine about providing Iran with armaments and missile technology. I deduct, therefore, a different calculation, or perception of the bigger picture, in Beijing than in Washington about the potential threat of a nuclear Iran to the region. I doubt - strongly doubt - that offshore oil exploration in the US is going to figure much, if at all, in China's bigger picture. As for giving little credit to imagination ... let's just say I work within a structure that allowed me exposure to decision-making in the US and elsewhere. It is depressing, but Grand Strategy (in the sense that Basil Liddell Hart defined it) is dead. I think it went into coma with Nixon - he was too cynical to have a true strategic vision - and was killed off, in the US, sometime in the 1990s - Somalia, or perhaps the Balkans, you take your pick. Since then, we are in the world of tactical maneuvering in the international arena. Don't get me wrong, I like Obama and I think that he probably would like to have a strategic - if not a Grand Strategic - vision of the US interest and external relations. I just don't think that the world, and specifically US politics, is set up for that any more.
- icarusr
April 18, 2010 at 9:51pm
*its
- icarusr
April 18, 2010 at 9:52pm
Maybe the fuel efficiency standards increase and the focus on renewable technology is in preparation for the real long term (and I mean really long term) goal of the US being a net oil exporter!
- ericad
April 19, 2010 at 2:02pm
Ick: "...you remove the first sentence, I submit that the rest remains valid." I much prefer it that way. I agree that China as an emerging power has an interesting set of dovetailing reasons for their actions. "I deduct, therefore, a different calculation, or perception of the bigger picture, in Beijing than in Washington about the potential threat of a nuclear Iran to the region. I doubt - strongly doubt - that offshore oil exploration in the US is going to figure much, if at all, in China's bigger picture." Agreed here. My take on that was that BHO is making a series of short term decisions based upon political calcuations and (possibly) providing a future base for those long term decisions. What's drilling off the East coast going to accomplish? Probably little, and the sooner that the right comes to grips with that, the better. "As for giving little credit to imagination ... It is depressing, but Grand Strategy (in the sense that Basil Liddell Hart defined it) is dead ... I just don't think that the world, and specifically US politics, is set up for that any more." This is where I am troubled the most. If absence of a grand strategy is de facto, so be it. I just refuse to accept that this is how it has to be. Energy strategy, climate strategy, population strategy, etc., all of these things (assuming that we as a species might be on this planet for some time - Repub's close your ears) - all of these things necessitate a long term stategy. Sure, maximum tension requires day after day of long term strategy - I fully understand your POV here. But there has to be something more. I refuse to believe that just because the broader strategy won't be realized by us, that we should stop contemplating and perfecting it. Even if that means we beat on, boats against the current ...
- jmarshall
April 19, 2010 at 7:49pm
day after day of SHORT term strategy
- jmarshall
April 19, 2010 at 7:51pm
It is not how it has to be; it is how it is. Decision-making processes ebb and flow; who knows, in four years or in a generation, we might well be able to find our bearings again. I agree that if it were the case permanently, we are probably doomed as a species.
- icarusr
April 20, 2010 at 1:36pm