Basic variables in the energy market map

Basic variables in the energy market map
 

May 25, 2014 8: 28 am 
Dr. Ibrahim Bahr Al-uloum

In recent years, led indicators for fundamental changes in the international energy map include consumption patterns and display energy worthy of monitoring, including:

1. technological development in oil and gas from non-traditional sources in the United States in the past years. And open the possibility of self-sufficiency for the biggest global energy perched high at the end of the Decade, producing States. And modern techniques in oil shale production up nearly 1 million barrels per day at the end of the current with a steady increase in the production of shale gas.

2. open up Iraq to foreign investment during the 2009-2010 in the biggest historical opportunity in the global energy industry where nearly half of the oil and gas reserves of approximately 70 billion barrels of public auctions in multiple licensing rounds yielded the signing of service contract with global and regional companies and coincided with the signing of more than 50 in the Kurdistan region. And enable Iraq to increase oil production by about a million barrels a day within two years. And became the second largest oil exporter in OPEC, after Iran towards a competitive future for OPEC's largest producer Saudi Arabia.

3. continued growth on energy sources at rates ranging from 33-40% between now and 2035 would be Asia, the increase is approximately 60%. And lead the emerging economies such as China and India one third of five expected increase with a marked decline in the share of States in energy consumption after dominate the energy market in the 1960s, with rates exceeding 70%. Fossil fuels will continue to play a pivotal role over the coming decades.

So there are significant changes in a map of energy producing and consuming countries for decades to come. Does this change the paths of the concept of energy security.

Change the course of world consumption

Is likely to move the center of gravity of global energy consumption in Asian countries, especially China and India would be energy-exporting countries in the region draw ties and political relations and trade over the next two decades whose features may differ than what it once was.

As an example of the speed shift track has acquired over the past decades Iraq strategy to export crude oil to the markets of the three of us, European and Asian and the u.s. market is about 38-40% of its exports, but today it has become more than 50 percent of Iraq's exports towards Asian markets and reduced dependency on income markets power from Iraq. The United States relies on energy revenues to 20% and is likely due to increased production of oil and gas from unconventional sources amount to self-sufficiency.

In any case, the United States adopted its policy to reduce its dependence on energy from the Middle East revenues, will have another option when the lack of supplies depending on the production of system of non-traditional sources in Canada and Brazil. The question remains will the geopolitical repercussions on overall relations with the Gulf system?.

Economic development paths

The well-being and prosperity of developing countries is measured by the rate of energy consumption and energy is a key component to development and political stability.

Iraq: Iraq per capita consumption of energy daily low compared to the peoples of the region by wars and unrest. Per capita consumption is estimated at about 1.3 tons of Iraqi fuel where McAfee represents one third of the per capita consumption of energy in the Middle East (3.4 tons of fuel per year McAfee). It is expected to increase oil revenues and improved incomes for maintaining adequate economic growth comes an increase in energy consumption in Iraq in the coming years for welfare and reduce poverty levels and include the need for electricity, housing, education, health, transport, etc.

China: in order to maintain current levels of economic growth will increase energy consumption and expected oil consumption of about 10 million barrels a day to support its economy and industry. China to increase demand for energy as an imperative for development and provision of basic needs. Looks almost 800 million people go to the standards of the middle class in the coming periods. Thus you will be responding to international requirements and this is what we observed in resistance to us pressure on restrictions on oil revenues from Iran.

Path of Chinese investment

Chinese oil companies entered the scene energy investment in Iraq with full force and was one of the first recorded presence in Iraq. The contract passed with the Chinese at the time of the former regime to develop Al-ahdab field in Wasit Province was negotiated early and without difficulties to transform it into a service contract in 2008 with the Chinese before the start of the Snook rounds licenses on June 30, 2009. Work began on the development of the field before the Parliament to abolish the previous decade. Zubaidiya electric station was set up near the field card 1200 megawatt Chinese suggested increasing vulnerability at affordable prices.

In the first and second licensing round for developing fields discovered and produced Chinese companies had a distinct role in the participation of coalitions. was a snook CNOOC A partner of Britain's BP to develop Rumaila. and share the same company develop three Maysan fields (West of webzrkan and jaw) in the second round of licensing for the company Petrochina Share in total to develop the NARC Halfaya oilfield in Maysan. these fields are expected to produce about 2 million barrels a day in future years, up to about 3 million barrels a day by the end of 2025. s06e19 entered production route a year ago and entered the Halfaya oilfield production in the summer of last year, and work is continuing to increase production rates.

And the Dragon towards the West Qurna phase 1, run by a coalition of ExxonMobil in 2013, after the company announced its desire to sell part of its stake because of friction with the central policy of signing contracts with the Kurdistan Regional Government, and managed the negotiations so gripped Inc. Petrochina 25% of the shares in the given field.

The Chinese oil companies, State-owned companies compete us private sector companies and European and have a political decision to enter Iraq and secure the shares directly in production facilities and energy supply chain and financial support by the Government and run it under market economy smoothly.

If security and political stability in Iraq hinders Chinese enterprises and corporations have not cited the lack of a legal and administrative framework of oil wealth but are looking primarily to secure energy demand instead of waiting for their share of the market but with the goal to effective access to resources and opportunities in any location without stopping the lucrative financial returns on contracts.

Perhaps the licensing rounds more tests for the national oil companies of other Asian countries may not be the size of Chinese companies but they indicating a new phase of investment in Asian oil companies expand to rival oil giants, backed by state capital away somewhat from the fundamentals of supply and demand.

Which might be part of a new energy map in Iraq is not subject to the market forces driving as is the performance of oil companies dominate the market. In contrast, we find that Iraq is not concerned if the current role of the companies supported by the State are a sustained demand for energy and their interactions may be ISRA affair but the future may produce different types of conflict.

Not only the role of Chinese companies in Iraq and in the extractive sector, but also to transfer sector in Saudi Arabia concluded a contract for the construction of a 400,000 bpd refinery in Iran, Sudan and the Gulf.

The role of international organizations

In the producer countries, "OPEC played» coordinating role to define production ceilings resulting in success, for certain periods, to maintain competitve international market and economic shocks. However, the political circumstances in the region over the past two years reflected the divergent political positions among its members took a heavy toll on the Organization's performance and making decisions about production and clearly emerged in the OPEC meeting in June 2011 as the Ministerial Conference could not produce a final statement, despite pledges to increase production to meet the needs of the market and the compensation for the interruption of Libyan oil. OPEC members divided into two axes: axis and some Gulf States and Venezuela and Iran, making OPEC's future is at stake.

Nuaimi said after the meeting that OPEC was worst during the 16-year-old. It has increased the tension between members of the organization when it pledged to compensate for the market because of sanctions imposed on Iran in addition to some community concern OPEC increase production capabilities of Iraq in the coming period and may be politically motivated. Unlike members reflected their inability to agree on a new candidate to lead the organization.

And in part consumed, the International Energy Agency, the executive arm of the industrialized countries since the mid-1970s of the last century capable of coordination for easing oil price shocks, but the energy landscape indicates that more than 90% of the growth in energy demand will be from outside the membership of the organization. That penetrate into the Agency's role will be limited and marginal. While the Agency's role as «value for data collection and analysis of energy policy and improve transparency in the market became marginal for free from key members in the new landscape, such as China and India.

Under the political variables and change the energy map, will these organizations capable to work effectively or would need to be developed on the background of these variables.

Iraq and the regional energy security

Energy security is critical and sensitive, the time has come to formulate policies from the following data:

1. energy security is no longer limited to oil and gas only as long as the control of the water sources are factors of disorder among the States of the region and as long as security precautions for its inhabitants is one of the major challenges. The sources of energy in the new century, expanded to include primary energy sources and renewable erector and infrastructure. Energy and resources became crucial lastraitgat national security of each country in the region.

2. the population increase in Iraq and neighboring countries pushed other latent food issues and other infrastructure to be concept (energy independence) on top national security priorities. But certainly not Iraq and neighbouring States are able to ensure all elements of the power required to meet the needs of the population and this would lead to the instability of the national security strategies.

A map of the territory's energy consumption

It is important to focus on a map of energy consumption in Iraq and neighbouring countries to identify sources of bugs that can serve as an entry point for promoting regional energy security vision:

1. Iraq: oil is the basic component of energy. But Iraq currently suffers a shortage of gas and petroleum products in addition to water shortages and desertification.

2. Saudi Arabia and Kuwait as well as representing their element base oil for energy. But the ysaorhmha is not confined to water scarcity and food but future risks from excessive aatmadhemha on crude oil for power generation because of the scarcity of gas.

3. Turkey: water is basically non-energy component of the national security depends on the import of oil, gas, coal and water investment limits to promote energy security and food.

4. Syria and Jordan: both suffered from limited sources of energy.

5. Iran: despite having multiple sources of energy but in the gasoline shortage and possible future risks from low levels of oil production.

A constituent of regional energy security

So there is a clear contrast on a map of energy consumption in Iraq and neighbouring countries, but that all of these countries are facing power shortages along and there is certainly the possibility of integration in the consumption needs in one way or another contribute to the strengthening of regional security based on the following principles:

1. we can't when addressing energy security at the national level without reference to the neighbouring regional energy security and this portal contributes to the strengthening of energy security in the region.

2. any national effort to enhance energy security at the expense of regional energy security would be counterproductive, for example, the policy of Turkey.

3. the key to regional energy security between Iraq and its neighbours lies in the ability to elaborate a strategic vision based on the principle of mutual energy security. This would contribute to strengthening security and national security will continue in succession crises.

So the challenge facing Iraq and neighbouring States in the ability to use energy resources to promote common interests towards creating the kind of balance between national and regional energy security


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