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US Energy Policy: Development and Challenges -
Introduction
Martin Jirušek, PhD.
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Course Content
̶ Introduction to US energy sector
̶ Policy aspects
̶ Historic and cultular background
̶ Emphasis on oil sector
- history
- structure
- milestones and key determinants
̶ Contemporary issues and trends
̶ Ramifications for IR
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Course Content
̶ Pay attention to deadlines and course requirements
̶ Papers
̶ Mid-term test
̶ Final exam
̶ Follow the course sylabus (available in the Information
System), not the timetable
̶ jirusek.martin@mail.muni.cz
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Role of Oil in the Global Economy
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Prominent role of oil
̶ Crucial for transportation and chemical industry
̶ Prominent position of oil in the global economy
̶ Determining factor of economic development
̶ Economic power as ‘universal power’ – can be transformed into any other type of power
̶ A litmus test of the economic performance – shifts in oil consumption as signals of
economic growth/stagnation
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Prominent role of oil
̶ Easy to store and deliver
̶ Positive EROEI
̶ Relatively easy to process
̶ Versatile in terms of use
̶ Used in transport – internal combustion engine, key for economic output
̶ Used in chemical industry
Fractional Distillation
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Dominant Role of Oil Among Energy
Sources (World)
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Non-OECD Asia Pushing the Consumption
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Strategic approach
Energy resources – tool or just an ordinary commodity?
Market-based approach
̶ based on realism
̶ state as the main player
̶ state interventions
̶ market seen as unreliable
̶ subordinated to a state´s needs
̶ energy as a legitimate tool
̶ non-normalized commodities
̶ undesirable dependency
̶ based on liberalism
̶ market as the main player
̶ state interventions limited
̶ energy commodities normalized
̶ dependency is not a problem
̶ cooperation is desirable
̶ cost/benefit sharing
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Determining Factors, Trends & Concepts
̶ Consumers vs. Producers
̶ Supply security vs. Demand security
̶ Strategic (state-centric) vs. Market-oriented approach
̶ Challenges to the market
̶ Political
̶ Technical
̶ Logistical
̶ Natural
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…Political
̶ Nationalization of oil industry
̶ Non-market deals (exclusive access to resources)
̶ Unstable producers
̶ Oil weapon
̶ Wars on resources
̶ ‘Petrodollars’
̶ ‘New’ consumers (China 1990s vs. China 2019)
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… Political
̶ Energy as a stable issue across different administrations
̶ Key role in times of crises - Nixon, Carter
̶ Policy changes (Dems vs. GOP)
- differences in approaches and tools
- emphasis on supply (GOP) – stability of supplies
vs.
- emphasis on demand (Dems) - environmental aspects, conservation measures
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…Technical
̶ Unconventional sources
̶ New techniques
̶ Maturing fields
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…Logistical
̶ Chokepoints
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…Natural
̶ Non-renewables as a finite resources
̶ Peak Oil
̶ Natural disasters
̶ Environmental impact
̶ Rita & Katrina (2005), 2017 hurricane season
̶ Shut down 70% of US refining capacity
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