Energy 'as vital' as China for new global power
Updated
A senior Australian international relations specialist says the changing economics and politics of energy will be as important as the rise of China in reshaping global power and that it could be more important than climate change. Emeritus professor Stuart Harris says energy issues have the potential to spark conflict over existing disputes in areas like the South China Sea.
Presenter: Linda Mottram, Canberra correspondent
Speaker: Stuart Harris, emeritus professor, Australian National University
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MOTTRAM: Most of the projected growth in global energy demand is expected to come from fast developing China and India. But other Asian countries are on the same trajectory, just as forecasts indicate that oil production will soon peak - or more likely plateau - putting new pressure on supplies. It's part of an equation that emeritus professor Stuart Harris from the Australian National University says needs the same sort of attention which is given to the challenge of the rise of China itself.
HARRIS: It is, in my view, becoming increasingly difficult to look at international relations without looking at energy and since the changes in play, I think, are quite fundamental, they will lead to major changes in global power, changes in political and economic power.
MOTTRAM: He calls it the new geopolitics of energy and he says it has three broad structural features - the end of cheap oil, the changed role of the major international oil companies, and the growing energy importance of the Middle East and Russia, home to most of the world's remaining oil and gas reserves.
Another element is that oil exporting countries are gaining much greater economic power through high energy revenues, which they invest overseas through their sovereign wealth funds to buy influence, an example being Venezuela in Latin America.
So, for oil importers, energy security is already at the top of the security agenda.
Professor Harris says a key relationship that's being affected by the changing global energy system is that between China and the United States. And on both sides there are alarmist predictions that the two will come to blows over energy in the Middle East.
Professor Harris disagrees.
HARRIS: The US and China, the two largest consumers of energy, are competitors in the energy market, but they have shared interests in energy security and that would include avoiding supply disruptions, increasing investment and basically cooperating within the international system.
MOTTRAM: China, though, is suspicious of the US. In particular, it believes the US to be in a position to protect its oil shipping lanes, and to deny access to others, where China cannot. Professor Harris disagrees, saying the task of disrupting oil transported by ship is so huge as to be almost impossible, short of full scale war. And he dismisses US fears about China's blue water naval ambitions.
HARRIS: It seems to me that Taiwan and protecting China's coast still have the priority in China's naval strategy development.
MOTTRAM: In the Asia Pacific region, though, a tighter and more volatile energy market will mean more likely supply disruptions and higher prices. And professor Harris warns weaker states suffering the effects could be destabilised and possibly dangerously so.
He cautions that rather than leading to new conflicts, the changing energy system could aggravate existing, low profile tensions. For example, on the oil rich Caspian Sea, where there have already been squabbles between Iran and Turkmenistan, or in the South China Sea.
HARRIS: Those disputes become critical once the energy not only gets high price but people start to feel fearful about not being able to get enough energy then they're going to start to see conflicts which were not really taken seriously, suddenly becoming amplified in the sense of perhaps you know actually military exchanges.
MOTTRAM: Professor Harris also warns that the greater the perception that peak oil is close, the more some governments seeking energy security may abandon international cooperation in a rush for maximum energy advantage. It's a scenario that is also ripe for conflict.
