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	<title>StrategyUnit:Foreign Policy &#038; Security Issues Blog &#187; Energy Security</title>
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		<title>Snake Oil in the Gulf of Mexico?</title>
		<link>http://www.strategyunit.net/2006/09/snake-oil-in-the-gulf-of-mexico/</link>
		<comments>http://www.strategyunit.net/2006/09/snake-oil-in-the-gulf-of-mexico/#comments</comments>
		<pubDate>Sat, 09 Sep 2006 04:21:30 +0000</pubDate>
		<dc:creator>StrategyUnit</dc:creator>
				<category><![CDATA[Energy Security]]></category>

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		<description><![CDATA[Introduction on the Gulf of Mexico Discovery:
Via WindsofChange, in &#34;Treasure in the Waters&#34;, Publius Pundit covers the story regarding Devon and Chveron&#8217;s recent energy discovery in the Gulf of Mexico:
Treasure was discovered in America&#8217;s Gulf of Mexico waters today, black gold so vast and so deep and so surprising and so recoverable that overnight, America&#8217;s [...]]]></description>
			<content:encoded><![CDATA[<p><strong>Introduction on the Gulf of Mexico Discovery</strong>:</p>
<p>Via WindsofChange, in &quot;Treasure in the Waters&quot;, Publius Pundit covers the story <a href="http://www.publiuspundit.com/?p=2904">regarding Devon and Chveron&#8217;s recent energy discovery</a> in the Gulf of Mexico:</p>
<blockquote><p>Treasure was discovered in America&rsquo;s Gulf of Mexico waters today, black gold so vast and so deep and so surprising and so recoverable that overnight, America&rsquo;s energy reserves have just increased as much as 50%. Chevron, Norway&rsquo;s Statoil and deep-sea driller <a href="http://phx.corporate-ir.net/phoenix.zhtml?c=67097&#38;p=irol-newsArticle&#38;t=Regular&#38;id=901621&#38;disclaimer=yes">Devon Energy</a> have just discovered as many as 15 billion barrels of previously unknown oil in a vast underwater pool five miles under the floor of the sea. No one even had a clue about this huge oil&rsquo;s existence up until new high technology of deep sea drilling (cost: $1 billion a pop, and every bit as weird and high-tech as a spaceship) came to the fore.</p>
</blockquote>
<p><strong>The Many Inaccuracies of Energy/Oil/Natural Gas Discovery</strong></p>
<p>First off, always be very sceptical of new energy (oil, natural gas) discoveries. If you read closely, you&#8217;ll usually find a large amount of speculation and political pressure. Randy Kirk brings a very sobering example here:</p>
<blockquote><p>[The] announcement is reminiscent of the Mexican &quot;huge oil discovery&quot; announced last year, of a possible 10 billion barrels, which was quietly revised this year to around 43 million barrels, <a href="http://www.energybulletin.net/17967.html">a downward revision of 99.57%</a>. This similar &quot;discovery&quot; was made in Mexico last year a few months before the Mexican parliament was to vote on Pemex (state oil co)&#8217;s budget and rights to expand drilling. This illustrates the potential political pressure to announce oil and gas discoveries. </p>
</blockquote>
<p><strong>&nbsp;Political Pressure </strong></p>
<p>&quot;Timing is Everything&quot; so the saying goes. Regarding the recent claims of massive discovery in the Gulf of Mexico, <a href="http://www.usatoday.com/news/washington/2006-09-06-drilling_x.htm">timing seems to be an factor</a> to look at regarding the enormous energy claims:</p>
<p>&nbsp;</p>
<blockquote><p>As news of a huge oil discovery deep in the western Gulf of Mexico unfolded, informal talks began in Congress to break an impasse over competing House and Senate plans to expand offshore oil and natural gas-drilling.</p>
</blockquote>
<p>&nbsp;</p>
<p>Massive Oil and Natural Gas discovery in the Gulf of Mexico. Right while the Senate battles over opening the Gulf of Mexico to offshore drilling. Coincidental?</p>
<p>Speaking of timing, doesnt the <a href="http://news.yahoo.com/s/ap/20060908/ap_on_go_co/iraq_report">Senate report on the lack of links between Bin Laden and Saddam</a> seem very well timed for the coming anniversary of September 11th?&nbsp;&nbsp;</p>
<p><strong>Links</strong></p>
<ul>
<li>&quot;<a href="http://www.energybulletin.net/20140.html">Clarification of the Huge Chevron Gulf Oil Discovery</a>&quot;, Energy Bulletin </li>
<li>&quot;<a href="http://www.usatoday.com/news/washington/2006-09-06-drilling_x.htm">Offshore-drilling legislation heats up</a>&quot;, USA Today</li>
</ul>
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		<title>Energy Security: Interdependence or Independence</title>
		<link>http://www.strategyunit.net/2006/07/energy-security-interdependence-or-independence/</link>
		<comments>http://www.strategyunit.net/2006/07/energy-security-interdependence-or-independence/#comments</comments>
		<pubDate>Mon, 03 Jul 2006 21:35:51 +0000</pubDate>
		<dc:creator>StrategyUnit</dc:creator>
				<category><![CDATA[Energy Security]]></category>
		<category><![CDATA[Quick Post & Links]]></category>

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		<description><![CDATA[Quick Post: Towards a Broader view of Energy Security?
Sebastian Mallaby of the Washington Post does an excellent job in &#8220;What &#8216;Energy Security&#8217; Really Means&#8221; on broadening the general public&#8217;s view of energy security. Read on.
What everyone thinks about energy security:
&#8220;For many American leaders, energy security means producing energy at home and relying less on foreigners. [...]]]></description>
			<content:encoded><![CDATA[<p><strong>Quick Post: Towards a Broader view of Energy Security?</strong></p>
<p>Sebastian Mallaby of the Washington Post does an excellent job in &#8220;<a href="http://www.washingtonpost.com/wp-dyn/content/article/2006/07/02/AR2006070200675.html">What &#8216;Energy Security&#8217; Really Means</a>&#8221; on broadening the general public&#8217;s view of energy security. <a href="http://www.washingtonpost.com/wp-dyn/content/article/2006/07/02/AR2006070200675.html">Read on</a>.</p>
<p>What everyone thinks about energy security:</p>
<blockquote><p>&#8220;For many American leaders, energy security means producing energy at home and relying less on foreigners. But the United States imports three-fifths of its oil, and the share is heading up. For the foreseeable future, alternative fuel is unlikely to change that.&#8221;</p>
</blockquote>
<p>The alternative view:</p>
<blockquote><p>&#8220;Energy interdependence can actually be good for energy security: Just look at natural gas markets. Right now nearly all the natural gas that Americans consume comes from U.S. and Canadian fields; only 3 percent comes into the country by tanker in the form of liquefied natural gas. This renders the United States highly vulnerable to disruptions on its home continent. If terrorists or a hurricane took out a key pipeline, it would be hard to bring in alternative supplies from outside North America, and prices would spike upward. By buying more liquefied natural gas from a diverse range of foreigners, the United States would reduce its energy independence but enhance its energy security.&#8221;</p>
</blockquote>
<p>Also see Daniel Yergin&#8217;s Foreign Affairs article, &#8220;<a href="http://www.foreignaffairs.org/20060301faessay85206/daniel-yergin/ensuring-energy-security.html">Ensuring Energy Security</a>&#8220;.</p>
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		<title>A OPIC? The Need for a Forum on Energy Security</title>
		<link>http://www.strategyunit.net/2006/04/a-opic-the-need-for-a-forum-on-energy-security/</link>
		<comments>http://www.strategyunit.net/2006/04/a-opic-the-need-for-a-forum-on-energy-security/#comments</comments>
		<pubDate>Tue, 25 Apr 2006 08:07:44 +0000</pubDate>
		<dc:creator>StrategyUnit</dc:creator>
				<category><![CDATA[Energy Security]]></category>

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		<description><![CDATA[Introduction &#8211; Lugar, IEA and  Energy Cooperation
The Christian Science Monitor has an interesting article, &#8220;Bold idea for energy woes: global cooperation&#8220;, weighing in on the need for some sort of global cooperation among major importers in terms of energy security and alternative fuel development.
The article touches on a speech Senator Lugar gave at Brookings [...]]]></description>
			<content:encoded><![CDATA[<p><strong>Introduction &#8211; Lugar, IEA and  Energy Cooperation</strong></p>
<p>The Christian Science Monitor has an interesting article, &#8220;<a href="http://www.csmonitor.com/2006/0424/p02s01-wogi.html">Bold idea for energy woes: global cooperation</a>&#8220;, weighing in on the need for some sort of global cooperation among major importers in terms of energy security and alternative fuel development.</p>
<p>The article touches on a speech Senator Lugar gave at Brookings Institute early March. I highly recommend reading Lugar&#8217;s <a href="http://www.brookings.edu/comm/events/20060313.htm">excellent speech here</a>. Additionally, Sen. Lugar (R) and Sen. Obama (D) introduced a bill late March 2006 pushing for <a href="http://new-york-auto-show.autoblog.com/2006/03/26/alternative-fuels-act-introduced-in-congress/">alternative fuel development</a>.</p>
<p>The CSM article chiefly focuses on <a href="http://en.wikipedia.org/wiki/International_Energy_Agency">International Energy Agency</a> (IAE) as a potential vehicle for energy cooperation:</p>
<blockquote><p>So is it time for an OPIC &#8211; an organization of petroleum-importing countries &#8211; as a way to build up cooperation among the world&#8217;s booming and increasingly competitive energy consumers?<br />
&#8230;<br />
One hurdle in the road to developing cooperation among energy-consuming countries is the Bush administration&#8217;s distaste for the kind of international bureaucracy that might be charged with overseeing such a project, some experts say. But others add that the bones of what might be a starting point already exist in the International Energy Agency (IEA), a branch of the Organization for Economic Cooperation and Development that serves developed countries.</p>
<p>James Bartis, an expert in energy security at the RAND Corp. in Arlington, Va., says the IEA or something like it could serve as an &#8220;umbrella of oil consumers&#8221; that could begin to address fears about stable supplies and develop joint energy-investment strategies &#8211; and therefore become a force for stability in a world of tightening energy supplies.
</p>
</blockquote>
<p>The IEA was founded in 1974 in the wake of the 70s energy crisis. Its last major move was to coordinate the release of +2 million barrels of oil after Katrina. Will it take a bigger energy crisis to move the IEA towards a more robust, pro-active stabilizing force for energy security?</p>
<p><strong>Conclusion</strong></p>
<p>As noted in January 2006 at StrategyUnit, <a href="http://strategyunit.blogsome.com/2006/01/13/year-of-chinese-indian-friendshipon-oil/">India and China has declared a “Year of Friendship” centering on energy cooperation</a> on the development of alternative fuel, sharing information on energy bids and joint energy development.</p>
<p>That such emerging powers like China and India are taking steps to coordinating their energy policy is a telling development in global affairs. The US must see this as an opportunity to take the next step and slowly build a wider forum for major energy importers. In order to be taken seriously by other states, the US must also take steps to put its own house in order.</p>
<p>Holding hearings on high gasoline prices, while makes on popular with the public opinion, does little and to address the core concerns of our energy security. </p>
<p>Global energy security and coordination is in the US interests as it must seek to avoid a global dependency on oil-rich regimes that are far too often hostile to the US and its interests and even including those of other importing nations. The questionable stability of oil supplies, environmental damage, hostility of oil rich regimes, and oil peak concerns should be more than enough motivation for the US to help lead and shape a global forum to combat these issues. If not by the current Bush Administration (which is facing a lame-duck problems), than hopefully the next.</p>
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		<title>Quick Post: Update on India, US and Anglosphere &#8211; The Economist Writes</title>
		<link>http://www.strategyunit.net/2006/02/quick-post-update-on-india-us-and-anglosphere-the-economist-writes/</link>
		<comments>http://www.strategyunit.net/2006/02/quick-post-update-on-india-us-and-anglosphere-the-economist-writes/#comments</comments>
		<pubDate>Tue, 28 Feb 2006 08:26:19 +0000</pubDate>
		<dc:creator>StrategyUnit</dc:creator>
				<category><![CDATA[China, Japan and East Asia]]></category>
		<category><![CDATA[Commentary]]></category>
		<category><![CDATA[Defense]]></category>
		<category><![CDATA[Energy Security]]></category>
		<category><![CDATA[New/Old Core and Gap States]]></category>
		<category><![CDATA[Quick Post & Links]]></category>
		<category><![CDATA[South Asia - India et al]]></category>
		<category><![CDATA[miscellaneous]]></category>

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		<description><![CDATA[Quick Post: Update on &#8220;Getting India Right : Recreating the Anglosphere&#8221;
The Economist Writes on US-India relations
The StrategyUnit has recently posted several articles relating to India, with the strongest being &#8220;Getting India Right : Recreating the Anglosphere&#8220;, where it is declared:
&#8220;There has been discussion that just as Great Britain gracefully passed its world power status to [...]]]></description>
			<content:encoded><![CDATA[<p><strong>Quick Post: Update on &#8220;Getting India Right : Recreating the Anglosphere&#8221;</strong><br />
<em>The Economist Writes on US-India relations</em></p>
<p>The StrategyUnit has recently posted several articles relating to India, with the strongest being &#8220;<a href="http://strategyunit.blogsome.com/2006/02/08/getting-india-right-recreating-the-anglosphere/">Getting India Right : Recreating the Anglosphere</a>&#8220;, where it is declared:</p>
<blockquote><p>&#8220;There has been discussion that just as Great Britain gracefully passed its world power status to the United States, the United States must look to do the same with India or else face decline in the face of a raising China.&#8221;</p>
</blockquote>
<p>Now the <a href="http://www.economist.com/opinion/displayStory.cfm?Story_ID=5548089">Economist (Feb 25)</a>, ahead of Bush&#8217;s March visit to India, leads with two articles highlighting the Bush Administration&#8217;s approach with India. The second article, &#8220;<a href="http://www.economist.com/agenda/displaystory.cfm?story_id=E1_VVGJRQP">The Great India Hope Trick</a>&#8220;, goes through the three major topics: 1) the difficulty surrounding the Bush Administration&#8217;s nuclear technology deal with India; and 2) the American temptation to see India as part of an anti-China axis partner; 3) while India needs and wants to be seen as an equal in any partnership with the US.<br />
<a></a><br />
The article also touches moves by the US to offer technology to assist with India&#8217;s energy security needs, while it faces the difficulty dealing with India&#8217;s relationship with Iran, Syria and China on energy projects.</p>
<p>As <a>mentioned earlier on StrategyUnit</a>, India&#8217;s geostrategic location near the Middle East, Asia and Central Asia make it an essential ally and a practical ally with its shared Anglo history, language and democractic institutions. While somewhat differing from StrategyUnit, the Economist ends the <a href="http://www.economist.com/world/displaystory.cfm?story_id=5545462">article</a> highlighting the attractiveness of India highlighting its &#8220;Stabiliy, Democracy, and Demography&#8221;:</p>
<blockquote><p>Nevertheless, in the long term, India has two great attractions. One is stability. India has proven mechanisms for the peaceful transfer of power and the ability to withstand terrible internal conflicts—in Kashmir and the north-east, for example—without danger to its integrity. China&#8217;s eventual transition to democracy could be traumatic. Another attraction is demography. China&#8217;s one-child policy ensures that it will grow old before it gets rich: a generation of only children may suddenly find themselves struggling to support the parents who once pampered them. India will remain younger and more dynamic well into the middle of the 21st century.</p>
<p>For many reasons, a close partnership between India and America seems both desirable and inevitable. The fraught negotiation over the nuclear issue, however, has revealed how difficult it will be to achieve. To America, and to many Indians, it must seem inconceivable that India—still so poor, and so desperately in need of just the sort of help America is offering—should not jump at the chance of a special relationship. How on earth, for example, could the idea of siding with Iran instead be seriously debated? But for many in India, “non-alignment” is a synonym for independence, and should not be sacrificed, however enticing the prize. Moreover, so confident is India&#8217;s mood at the moment, that many seriously believe America needs it more than the other way round. Tomorrow belongs to Asia.</p>
</blockquote>
<p>Other articles by StrategyUnit for 2006 on India:<br />
1. &#8220;<a href="http://strategyunit.blogsome.com/2006/02/27/needed-in-asia-security-and-energy-cooperation/">Needed in Asia: Security and Energy Cooperation</a>&#8221;<br />
2.  &#8220;<a href="http://strategyunit.blogsome.com/2006/01/13/year-of-chinese-indian-friendshipon-oil/">Year of Chinese-Indian Friendship…on Oil?</a>&#8220;</p>
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		<title>Needed in Asia: Security and Energy Cooperation</title>
		<link>http://www.strategyunit.net/2006/02/needed-in-asia-security-and-energy-cooperation/</link>
		<comments>http://www.strategyunit.net/2006/02/needed-in-asia-security-and-energy-cooperation/#comments</comments>
		<pubDate>Mon, 27 Feb 2006 08:46:18 +0000</pubDate>
		<dc:creator>StrategyUnit</dc:creator>
				<category><![CDATA[China, Japan and East Asia]]></category>
		<category><![CDATA[Commentary]]></category>
		<category><![CDATA[Defense]]></category>
		<category><![CDATA[Energy Security]]></category>
		<category><![CDATA[Globalization]]></category>
		<category><![CDATA[South Asia - India et al]]></category>
		<category><![CDATA[Southeast Asia]]></category>
		<category><![CDATA[miscellaneous]]></category>

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		<description><![CDATA[SummaryMany commentators have discussed the possibility of the Six-Party Talks on North Korea &#8211; which consist of China, Japan, US, Russia and the two Koreas &#8211; as the future basis for a security forum for Northeast Asia. East Asia is an important and dynamic region with growing economies and equally growing security needs, yet formal [...]]]></description>
			<content:encoded><![CDATA[<p><img src="images/chinaindiasmall.jpg" alt="" align='left' vspace='5' hspace='5' /><strong>Summary</strong><br />Many commentators have discussed the possibility of the Six-Party Talks on North Korea &#8211; which consist of China, Japan, US, Russia and the two Koreas &#8211; as the future basis for a security forum for Northeast Asia. East Asia is an important and dynamic region with growing economies and equally growing security needs, yet formal mechanism exist for communication and dialogue among the major players.</p>
<p>While the need for a security forum is apparent to all players involved, the specific issue that should help bring a security forum into fruitarian is <strong>Energy Security</strong>. The need for energy security coordination in a region highly dependent on imported oil is well overdue.</p>
<p>Indeed, even in the OSCE, the current chairman has <a href="http://www.diplomatie.be/en/press/homedetails.asp?TEXTID=47037">called for a confer</a>ence for all OSCE members to discuss the need for better coordination on energy security matters. It is time for the even more imported energy dependent nations of Asia to do the same and much more.<br />
<a></a><br />
<strong>Introduction</strong><br />
Many pundits have been talking about the Asian Century; indeed, the <a href="http://www.economist.com/world/displaystory.cfm?story_id=5545462">Economist </a>recently ended its special report&#8221; article on India with “Tomorrow belongs to Asia”. Asia has been roaring ahead in economics, technology, science and beginning to match such might with political and military power. Yet, there lacks an mechanism to discussion security issues and more importantly coordinate on energy issues</p>
<p>Asia is home to many of the biggest importer of oil, such as China (40%), India (70%), South Korea (~100%) and Japan (~100%), who are also additionally major players in the world economy.  Taken into account that some <a href="http://www.princeton.edu/hubbert/current-events.html">experts have claimed Peak Oil has already passed (December 16, 2006)</a>, we see the dire need for such states, many with rapidly growing economies, to take energy security extremely seriously.</p>
<p><strong>Setting-Up Energy Cooperation</strong><br />
As StrategyUnit has mentioned, <a href="http://strategyunit.blogsome.com/2006/01/13/year-of-chinese-indian-friendshipon-oil/">China and India has already made some steps into energy cooperation</a>, but there is a need for a more formal network towards regional security and coordination in energy security. An organization similar to the Organization for Security and Co-operation in Europe (OSCE) is in order to coordinately, share and develop market strategies that benefit all the players in the region, including Russia and the United States. Cooperation/coordination on energy-conservation, diversification of energy types and sources and transportation of energy resources are key areas deserving attention by all states in the region.</p>
<p>A forum that would enable cooperation, coordination and (at least) discussion on energy matters would also lessen the occurence of fierce competiton of energy resources that could lead to unnecessary friction and strain among the Asian states.</p>
<p>The ASEAN, APEC and the East Asian Summit are either not effective enough or does not includes Russia, the United States and India. The participating states in the Six-Party talks (North Korea excluded) along with India should be the initial members in this security organization. Having all states from Burma to the Philippines would prove too unwieldy.</p>
<p><strong>Conclusion</strong><br />
Will such an organization ever appear? In the short-term, there appears to be no major players willing to publicly support such a move, but the India-China cooperation is a sign that in the medium-long term momentum may build as it will become obvious that regional energy cooperation is to the benefit of all.</p>
<p>The one issue fo the United States is Iran, as any talk of energy security would invovle China and India&#8217;s energy dealings with Iran. But, ultimately,  the US cannot let this one issue (albiet a major issue) lock itself out from having any positive influence in contributing to the energy and security discussions of the growing powers in Asia.</p>
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		<title>Commentary: DailyKos on the Iranian Bourse, Oil, Euro and Dollars</title>
		<link>http://www.strategyunit.net/2006/02/commentary-dailykos-on-the-iranian-bourse-oil-euro-and-dollars/</link>
		<comments>http://www.strategyunit.net/2006/02/commentary-dailykos-on-the-iranian-bourse-oil-euro-and-dollars/#comments</comments>
		<pubDate>Mon, 27 Feb 2006 06:00:10 +0000</pubDate>
		<dc:creator>StrategyUnit</dc:creator>
				<category><![CDATA[Energy Security]]></category>
		<category><![CDATA[Globalization]]></category>
		<category><![CDATA[Iran]]></category>

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		<description><![CDATA[Commentary
Back in January, StrategyUnit posted the article &#8220;Iran Crisis: Another War for Oil, Bourse and the US Dollar?&#8221; on the scheduled March opening of Iranian oil exchange (bourse), which is based on euros rather than US dollars:
This has fueled (no pun intended) speculation of the real cause of the Iranian crisis. The Iraq War has [...]]]></description>
			<content:encoded><![CDATA[<p><strong>Commentary</strong></p>
<p>Back in January, StrategyUnit posted the article &#8220;<a href="http://strategyunit.blogsome.com/2006/01/21/iran-crisis-another-war-for-oil-bourse-and-the-us-dollar/">Iran Crisis: Another War for Oil, Bourse and the US Dollar?</a>&#8221; on the scheduled March opening of Iranian oil exchange (bourse), which is based on euros rather than US dollars:</p>
<blockquote><p>This has fueled (no pun intended) speculation of the real cause of the Iranian crisis. The Iraq War has been criticized as a &#8220;War for Oil&#8221;. And now, as a second act, there are folks from Daily Kos to <a href="http://www.atimes.com/atimes/Middle_East/HA21Ak01.html">Asia Times</a> saying the same of the Iran Crisis. The most aggressive promoter of this view appears to be from <a href="http://energybulletin.net/12125.html">Krassimir Petrov</a>.</p>
</blockquote>
<p>Indeed, DailyKos writters has also been furthering the Iranian Bourse conspiracy:</p>
<p>&#8220;Of course most of the saber-rattling is over Iran&#8217;s nuclear program and the word &#8220;bourse&#8221; is never mentioned.  But the IAEA has consistently stated that Iran is in full compliance with its regulations and the conditions of the Nuclear Non-Proliferation Treaty.  That doesn&#8217;t negate Iran&#8217;s political alignment and support for terrorism, but their nuclear energy program is hardly the threat it&#8217;s made out to be.</p>
<p>Only time will tell whether regime change is in the cards for Iran, especially at the hands of the United States.  But the Fed&#8217;s quiet decision to no longer print the M3 is definitely quite ominous.&#8221;</p>
<p>Yet, interestingly recently (Feb 24) a writter on DailyKos, Jerome a Paris, <a href="http://www.dailykos.com/storyonly/2006/2/24/74940/5678">writes to counter</a> the other DailyKos writters:</p>
<blockquote><p>&#8220;Crazy scenarios involving Iran&#8217;s purported attempts to create an oil bourse to start selling oil in euros make the rounds regularly, and even get <a href="http://www.dailykos.com/story/2006/2/23/21915/2997">recommended </a>with alacrity on DKos.</p>
<p>These things WILL NOT HAPPEN, and we have, as a supposedly reality-based community, to focus on real issues and not imaginary ones.</p>
<p>So let me explain why an Iranian oil bourse will not work for the foreseeable future. I hope that this diary can be used as a handy reference when this crops up again in the future.<br />
&#8230;<br />
So, say that Iran decides to sell its oil in euros. Fine. Both the Iranians and their clients will determine the price for the transaction in dollars, on one of the established markets, and will trade these dollars for euros for the actual payment operation. It will give banks active on the forex markets a little bit of income, but will change nothing to how oil is traded.<br />
&#8230;<br />
So please, let&#8217;s stop the fantaisies, or the conspiracy theories about a switch to euros or a new bourse. If any transaction, whether by Saddam, the Iranians or anyone else is expressed in euros, it is purely cosmetic. The underlying market is in dollars, and will remain that way.</p>
<p>We are badly undermining the credibility of the site by recommending silly scaremongering stories on that topic.&#8221;</p></blockquote>
<p> Indeed. Read the whole thing <a href="http://www.dailykos.com/storyonly/2006/2/24/74940/5678">here</a>.</p>
<p>Congrats to Jerome a Paris and DailyKos for keeping the balance.</p>
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		<title>Quick Links: Hamas Votes, Psiphon and State Power, Japan in Central Asia, John Woo on FISA, and Beer</title>
		<link>http://www.strategyunit.net/2006/02/quick-links-hamas-votes-psiphon-and-state-power-japan-in-central-asia-john-woo-on-fisa-and-beer/</link>
		<comments>http://www.strategyunit.net/2006/02/quick-links-hamas-votes-psiphon-and-state-power-japan-in-central-asia-john-woo-on-fisa-and-beer/#comments</comments>
		<pubDate>Tue, 21 Feb 2006 05:57:04 +0000</pubDate>
		<dc:creator>StrategyUnit</dc:creator>
				<category><![CDATA[China, Japan and East Asia]]></category>
		<category><![CDATA[Energy Security]]></category>
		<category><![CDATA[miscellaneous]]></category>

		<guid isPermaLink="false">http://www.strategyunit.net/2006/02/quick-links-hamas-votes-psiphon-and-state-power-japan-in-central-asia-john-woo-on-fisa-and-beer/</guid>
		<description><![CDATA[Today&#8217;s Quick Links
1. Hamas: Winning the Candidates, not Votes?
Via Chief Wiggum and Coming Anarchy, comes this interesting story:
A close look at the final results of last month&#8217;s Palestinian election shows that the apparent landslide that gave Hamas 74 of the 132 seats in the Palestinian Legislative Council and only 45 to the once-dominant Fatah movement [...]]]></description>
			<content:encoded><![CDATA[<p><strong>Today&#8217;s Quick Links</strong><br />
<strong>1. Hamas: Winning the Candidates, not Votes?</strong></p>
<p>Via Chief Wiggum and <a href="http://www.cominganarchy.com/archives/2006/02/19/hamas-and-the-palestinian-elections/">Coming Anarchy</a>, comes this interesting story:</p>
<blockquote><p>A close look at the final results of last month&#8217;s Palestinian election shows that the apparent landslide that gave Hamas 74 of the 132 seats in the Palestinian Legislative Council and only 45 to the once-dominant Fatah movement was, in the words of one analyst, &#8220;an optical illusion.&#8221;</p>
</blockquote>
<p><a href="http://sfgate.com/cgi-bin/article.cgi?file=/c/a/2006/02/19/INGMQH9TVO1.DTL">Read more Here</a></p>
<p><strong>2. Can &#8220;Psiphon&#8221; Beat China&#8217;s State Censorship?</strong></p>
<p>Non-State actors continues to undermine state control over information:</p>
<blockquote><p>[A] band of Internet volunteers headquartered in Cambridge has launched the Tor Project, which uses people&#8217;s spare Internet bandwidth to help others bypass the censors. And in Canada, computer scientists at the University of Toronto are working on a similar project, called Psiphon.</p>
<p>Anonymizer and Tor have attracted strong support from the US government. American military and intelligence services are major customers of Anonymizer, because it lets them scan foreign Internet sites without revealing their identities. The Voice of America, a broadcasting service sponsored by the US government, uses Anonymizer to help people in Iran tune in, despite their country&#8217;s efforts to block the signal.</p>
</blockquote>
<p><a href="http://www.boston.com/business/technology/articles/2006/02/20/beating_censorship_on_the_internet/">Read More</a></p>
<p><strong>3. Forget Russia, China and Russia, there&#8217;s also Japan in Central Asia</strong></p>
<p>From PINR (published by Asia Times):</p>
<blockquote><p>Japan added a new dimension to its engagement with Central Asia with the formation of the Central Asia Plus Japan (including Uzbekistan, Tajikistan, Kyrgyzstan and Turkmenistan) initiative in August 2004. While low-key compared with the Shanghai Cooperation Organization (SCO &#8211; China, Russia, Kazakhstan, Kyrgyzstan, Tajikistan and Uzbekistan), Japan through the Central Asia Plus Japan initiative is likely to play an increasingly significant geopolitical role, not just in Central Asia but also in Eurasia. An important question is how Japan&#8217;s new regional initiative will impact the SCO, which is largely considered the de facto regional organization in Central Asia. </p>
</blockquote>
<p><a href="http://www.atimes.com/atimes/Japan/HB18Dh03.html">Read More</a></p>
<p><strong>4. John Yoo on FISA and the War on Terror</strong></p>
<p>Interesting short interview by Foreign Policy:</p>
<blockquote><p>While an attorney with the U.S. Justice Department after September 11, his legal memos helped lay the groundwork for what some see as the Bush administration’s constitutional power grabs—from the treatment of enemy prisoners to domestic wiretapping. FP recently asked Yoo, now a law professor at Berkeley, about amending FISA, ending the war on terror, and whether torture works. </p>
</blockquote>
<p><a href="http://www.foreignpolicy.com/story/cms.php?story_id=3364">Read More</a></p>
<p><strong>5. Refrigerator with Built-In Beer Tap!</strong></p>
<p>Words cannot describe StrategyUnit&#8217;s Joy:<br />
<a href="http://www.homepub.com/site/uk/index.php?page=116"><img src="http://www.homepub.nl/p2/templates/tmpl_nl/images/hp_displayset.jpg" alt="HomePub" /></a></p>
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		<title>Year of Chinese-Indian Friendship&#8230;on Oil?</title>
		<link>http://www.strategyunit.net/2006/01/year-of-chinese-indian-friendshipon-oil/</link>
		<comments>http://www.strategyunit.net/2006/01/year-of-chinese-indian-friendshipon-oil/#comments</comments>
		<pubDate>Fri, 13 Jan 2006 08:44:11 +0000</pubDate>
		<dc:creator>StrategyUnit</dc:creator>
				<category><![CDATA[China, Japan and East Asia]]></category>
		<category><![CDATA[Energy Security]]></category>

		<guid isPermaLink="false">http://www.strategyunit.net/2006/01/year-of-chinese-indian-friendshipon-oil/</guid>
		<description><![CDATA[ 
Introduction: Chinese and Indian Energy Cooperation
India and China kicked off their &#8220;Year of Friendship&#8221; to a rather good start. Only a few days ago (Jan 9), China and India&#8217;s respective state-owned oil companies agreed on a joint venture on the purchase and development on oil assets in Syria. And now China and India agreed [...]]]></description>
			<content:encoded><![CDATA[<p><img src='/images/chinaindiasmall.jpg' alt='China and India - An Oil Friendship' align='left' vspace='10'> </p>
<p><strong>Introduction: Chinese and Indian Energy Cooperation</strong></p>
<p>India and China kicked off their &#8220;Year of Friendship&#8221; to a rather good start. Only a few days ago (Jan 9), China and India&#8217;s respective state-owned oil companies agreed on a joint venture on the purchase and development on oil assets in Syria. And now China and India agreed on sharing bid information on bidding on foreign hydrocarbon fuel (to avoid driving prices unnecesarrily) and to encourage joint ventures.</p>
<p>The document that China and India signed, the two most populous states, outlined &#8220;cooperation in upstream exploration and production, refining and marketing of petroleum products and petrochemicals, oil and gas pipelines, research and development, and promotion of environmentally friendly fuels.&#8221; (<a href="http://www.bangkokpost.com/breaking_news/breakingnews.php?id=72956">source</a>) The document also included agreements on coopertion on the production of biofuels.</p>
<p>In a visit to China, the Indian Petroleum and Natural Gas Minister Mani Shankar Aiyar stated:</p>
<blockquote><p>&#8220;We look on China not as a strategic competitor but a strategic partner,&#8221; said Aiyar in an exclusive interview in Beijing. &#8220;It is clear to me that any imitation of the &#8216;Great Game&#8217; between India and China is a danger to peace. We cannot endanger each other&#8217;s security in our quest for energy security.&#8221; </p>
</blockquote>
<p>Aiyar also brought up the idea of <a href="http://www.washingtonpost.com/wp-dyn/content/article/2006/01/10/AR2006011000286.html">joint pipeline connecting India and China</a>, but this is something India has brought-up in the past as well without substantial response from China.</p>
<p><strong>Motives and Benefits?</strong></p>
<p>On the surface, this partnership is quite puzzling. This movement towards cooperation would benefit India far more than China:</p>
<ul>
<li>India is more dependent on imported oil (China&#8217;s 30-40% to India&#8217;s 70%)</li>
<li>Indian oil companies have been repeatedly outbided by China, so why the need for China to cooperate?</li>
<li>China&#8217;s &#8220;Go-Out&#8221; oil strategy has been thus far successful with its connections in Central Asia, South American and from Sudan to Iran. So why would China cut a deal now?</li>
<li>China and India have gone through minor wars in the past and unresolved border disputes. How will these issues loom over China and India&#8217;s ability to cooperate?</li>
</ul>
<p>However, China and India have cooperated in some major instances, such as China’s support of India for permanent membership in the Security Council and in the Russian-Chinese led Shanghai Cooperation Organization (SCO), India sits as an observer and a potential future member.</p>
<p>But in a larger context, Chinese would be foolish to stand-by as US and India continue to forge a closer tie, esp. with word last year about the Bush Administration wishing to &#8220;help India become a major world power in the 21st century&#8221;, which has mainly manifested itself in the US willingness to help India&#8217;s civilian nuclear energy program despite the nuclear testing in 1998.</p>
<p>Broad energy cooperation from China (successful so far in its &#8220;Go Out&#8221; strategy) would prove very significant for an equally energy hungry India. Indeed, one could say that using energy cooperation would present a more enticing carrot than what the US can offer India: military equipment and nuclear energy technology.</p>
<p>Additionally, engaging and building relationships with neighboring partners would fit into China&#8217;s strategy of &#8220;Raising Peacefully&#8221;. China is continuing to build regional institutions to project its power, such as through the Shanghai Cooperation Organization (SCO) and the recent <a href="http://strategyunit.blogsome.com/2005/12/14/east-asia-summit-a-future-without-america/">Easts Asia Summit</a>. </p>
<p>Some would perhaps point out that any partnership would never work between India and China, as they are economic rivals. This is true in the area of energy resources, but when it comes to their economies, the two are very different. China is concentrating on manufacturing where as India moving ahead to high-tech software area and providing advances services, such in the financial industry.</p>
<p><strong>Conclusion</strong></p>
<p>With the exception of Japan (which even signed a $3 billion deal for <a href="http://www.atimes.com/atimes/Japan/HA13Dh01.html">Iranian oil</a>), things are looking rather lonely for the U.S. in Asia.  US must more vigorously appraoch India as natural partners, in its shared Anglo-heritage and as the world&#8217;s largest democracy. India can help share the burden as one of the pillars of security in the Middle East and Central Asia. And China too should be approach and incorporated under a new security framework in East Asia, with the United States and Japan.</p>
<p>The U.S. needs to lead in incorporating China, India and other emerging New Core powers into international organizations, as prescribed by Thomas Barnett. Else, these New Core states will look to seize the initiative and form their own alliances and institutions that will increasingly sideline the United States. We can help lead the future or sit back and watch as others make it for us.</p>
<p>PS: Why the lack of any coverage in this on New York Times, Washington Post etc? I am writing this on 1/13/2005 12:36AM, Pacific Time. Only the <a href="http://news.ft.com/cms/s/25b30866-83a4-11da-9017-0000779e2340.html">Financial Times</a>has something major so far.</p>
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		<title>Tom Friedman on &#8216;Being Green is the New Red White and Blue&#8221;</title>
		<link>http://www.strategyunit.net/2006/01/tom-friedman-on-being-green-is-the-new-red-white-and-blue/</link>
		<comments>http://www.strategyunit.net/2006/01/tom-friedman-on-being-green-is-the-new-red-white-and-blue/#comments</comments>
		<pubDate>Sun, 08 Jan 2006 01:53:08 +0000</pubDate>
		<dc:creator>StrategyUnit</dc:creator>
				<category><![CDATA[Energy Security]]></category>

		<guid isPermaLink="false">http://www.strategyunit.net/2006/01/tom-friedman-on-being-green-is-the-new-red-white-and-blue/</guid>
		<description><![CDATA[Weekend Reading: Thomas Friedman on Energy Gluttony and Security in the  Middle East and Beyond
In Yesterday&#8217;s New York Times, columnist and author Tom Friedman writes calls for a mature U.S. energy policy as central to the US and global security. Unfortunately, the piece is behind New York Time&#8217;s firewall, but thankfully it is freely [...]]]></description>
			<content:encoded><![CDATA[<p><strong>Weekend Reading: Thomas Friedman on Energy Gluttony and Security in the  Middle East and Beyond</strong><br />
<img src='/images/tomfriedman.jpg' alt='Tom Friedman on Energy Security' align='left' hspace='10' vspace='10' />In Yesterday&#8217;s New York Times, columnist and author Tom Friedman writes calls for a mature U.S. energy policy as central to the US and global security. Unfortunately, the piece is behind New York Time&#8217;s firewall, but thankfully it is freely available from my city library&#8217;s online database.</p>
<p>Most strikingly Friendman states that &#8220;A democratization policy in the Middle East without a different energy policy at home is a waste of time, money and, most important, the lives of our young people.&#8221;</p>
<p>In a sense he is correct. Reform in the Middle East will be more about economic diversity/connectivity rather than democracy. As we know petrol states suffer from lacking both, but economic connectivity (beyond just state oil companies selling black gold abroad) will help foster political moderation and pull these states from Gap to the Seam and to the Core (to use <a>Thomas Barnett&#8217;s terminology</a>).</p>
<p>Here&#8217;s an excerpt from Friendman&#8217;s article, &#8220;<a href="http://news.google.com/url?sa=t&#38;ct=us/0-0&#38;fp=43c0b8ae59bcea28&#38;ei=x2_AQ8glnrLpAeaS7JwD&#38;url=http%3A//select.nytimes.com/2006/01/06/opinion/06friedman.html%3Fhp&#38;cid=1103316132&#38;sig2=1KekSjegIxYvGRbm5Nt8Vg">Being Green is the New Red White and Blue</a>&#8220;:</p>
<blockquote><p>
The biggest threat to America and its values today is not communism, authoritarianism or Islamism. It&#8217;s petrolism. Petrolism is my term for the corrupting, antidemocratic governing practices &#8212; in oil states from Russia to Nigeria and Iran &#8212; that result from a long run of $60-a-barrel oil. Petrolism is the politics of using oil income to buy off one&#8217;s citizens with subsidies and government jobs, using oil and gas exports to intimidate or buy off one&#8217;s enemies, and using oil profits to build up one&#8217;s internal security forces and army to keep oneself ensconced in power, without any transparency or checks and balances.</p>
<p>When a nation&#8217;s leaders can practice petrolism, they never have to tap their people&#8217;s energy and creativity; they simply have to tap an oil well. And therefore politics in a petrolist state is not about building a society or an educational system that maximizes its people&#8217;s ability to innovate, export and compete. It is simply about who controls the oil tap.<br />
<a></a><br />
In petrolist states like Russia, Iran, Venezuela and Sudan, people get rich by being in government and sucking the treasury dry &#8212; so they never want to cede power. In non-petrolist states, like Taiwan, Singapore and Korea, people get rich by staying outside government and building real businesses.</p>
<p>Our energy gluttony fosters and strengthens various kinds of petrolist regimes. It emboldens authoritarian petrolism in Russia, Venezuela, Nigeria, Sudan and Central Asia. It empowers Islamist petrolism in Sudan, Iran and Saudi Arabia. It even helps sustain communism in Castro&#8217;s Cuba, which survives today in part thanks to cheap oil from Venezuela. Most of these petrolist regimes would have collapsed long ago, having proved utterly incapable of delivering a modern future for their people, but they have been saved by our energy excesses.</p>
<p>No matter what happens in Iraq, we cannot dry up the swamps of authoritarianism and violent Islamism in the Middle East without also drying up our consumption of oil &#8212; thereby bringing down the price of crude. A democratization policy in the Middle East without a different energy policy at home is a waste of time, money and, most important, the lives of our young people.</p>
<p>That&#8217;s because there is a huge difference in what these bad regimes can do with $20-a-barrel oil compared with the current $60-a-barrel oil. It is no accident that the reform era in Russia under Boris Yeltsin, and in Iran under Mohammad Khatami, coincided with low oil prices. When prices soared again, petrolist authoritarians in both societies reasserted themselves.</p>
<p>We need a president and a Congress with the guts not just to invade Iraq, but to also impose a gasoline tax and inspire conservation at home. That takes a real energy policy with long-term incentives for renewable energy &#8212; wind, solar, biofuels &#8212; rather than the welfare-for-oil-companies-and-special-interests that masqueraded last year as an energy bill.</p>
<p>Enough of this Bush-Cheney nonsense that conservation, energy efficiency and environmentalism are some hobby we can&#8217;t afford. I can&#8217;t think of anything more cowardly or un-American. Real patriots, real advocates of spreading democracy around the world, live green.
</p>
</blockquote>
<p>As usual, let me know if you would like to read the entire article (I excepted almost half of it), and I&#8217;ll send you a copy.</p>
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		<title>Russia-Ukraine Gas Update: Role of Dmitry Medvedev</title>
		<link>http://www.strategyunit.net/2006/01/russia-ukraine-gas-update-role-of-dmitry-medvedev/</link>
		<comments>http://www.strategyunit.net/2006/01/russia-ukraine-gas-update-role-of-dmitry-medvedev/#comments</comments>
		<pubDate>Fri, 06 Jan 2006 06:29:31 +0000</pubDate>
		<dc:creator>StrategyUnit</dc:creator>
				<category><![CDATA[Energy Security]]></category>
		<category><![CDATA[Europe]]></category>
		<category><![CDATA[Former Soviet Space]]></category>

		<guid isPermaLink="false">http://www.strategyunit.net/2006/01/russia-ukraine-gas-update-role-of-dmitry-medvedev/</guid>
		<description><![CDATA[Complimentaring StrategyUnit&#8217;s post on the Russia-Ukraine Gas sega, StratFor&#8217;s Peter Zeihan has an interesting perspective on the possible role and orientation of Dimitri Mendevev, Putin&#8217;s newly selected Prime Minister, and his in the Ukraine-Russian Gas issue.
StratFor&#8217;s article is interesting because it takes account to the role of Mendevev, whereas Jamestown Foundation, Eurasianet et al have [...]]]></description>
			<content:encoded><![CDATA[<p>Complimentaring <a href="http://strategyunit.blogsome.com/2006/01/03/russia-ukraine-and-natural-gas-russia-misguided-pipeline-politics/">StrategyUnit&#8217;s post on the Russia-Ukraine Gas sega</a>, <a href="http://www.stratfor.com">StratFor</a>&#8217;s Peter Zeihan has an interesting perspective on the possible role and orientation of Dimitri Mendevev, Putin&#8217;s newly selected Prime Minister, and his in the Ukraine-Russian Gas issue.</p>
<p>StratFor&#8217;s article is interesting because it takes account to the role of Mendevev, whereas Jamestown Foundation, Eurasianet et al have been more focused on Putin or Russia itself.</p>
<p>So, who is this Medvedev?</p>
<blockquote><p>In mid-November, Russian President Vladimir Putin named Dmitry Medvedev as first deputy prime minister. Medvedev is a rather rare personality in Russian politics, in that he is a modernizer who has not become unrealistically optimistic about Russia ever looking like &#8212; much less joining &#8212; the West, and a nationalist who has not fallen prey to the debilitating paranoia that often characterizes Russian policy. He also happens to be Putin&#8217;s protégé and the board chairman of Gazprom. The Ukraine natural gas crisis was his first Russian foreign-policy initiative.</p>
<p>Medvedev, like all Russians, recognizes that his country&#8217;s long-term prospects without Ukraine are, at best, bleak. That means that Russia&#8217;s European relations have become of secondary importance &#8212; they are no longer an end in their own right, but rather a means to other ends.</p>
</blockquote>
<p>According to Stratfor, Medvedev&#8217;s motivations are similar to what was mentioned in StrategyUnit&#8217;s article: a method to reassert Russia on the world stage, taking advantage of the G-8 chairmanship to set the tone of its chairmanship. In this case it is to force Europe to consider Russia&#8217;s interests, power and importance seriously.</p>
<blockquote><p>
Prior to the Jan. 1 shutoff, the Europeans had become complacent, unappreciative of the scope of their dependency upon Russia or how much they have taken a &#8220;friendly&#8221; Moscow for granted since the end &#8212; or even before the end &#8212; of the Cold War. Energy supplies to Europe continued throughout the Afghan war, the 1983 war scare, the Moscow Olympic boycott, the putsch against Gorbachev, the Soviet breakup, the Chechen war, the Kosovo war, and the enlargements of NATO and the EU. The Europeans grew confident that as far as energy supplies were concerned, the Russians &#8212; while unpredictable in their rhetoric &#8212; were rock-solid in their reliability.</p>
<p>Medvedev&#8217;s primary goal was to redefine European perceptions of Russia. As of Dec. 31, Western Europeans perceived Russia primarily as an easily dismissed, benign former foe. But with the Gazprom cutoff &#8212; which diminished gas supplies needed for heating in the middle of winter &#8212; Russia proved itself not only sufficiently erratic to be taken seriously, but also capable of inflicting very real pain with a modicum of effort.</p>
<p>Now, did the Russians want to hurt the Europeans? Of course not. Europe, particularly &#8220;old&#8221; Europe, remains a potential partner for Moscow, and there is no reason for the Kremlin to introduce spite into an already complex relationship. But did the Russians want the Europeans to know that the Kremlin has the capacity and chutzpah to turn the screws? Absolutely. And doing so at a time of year when the wind whipping off the North Sea is anything but balmy adds that ever-incisive Russian touch.</p>
<p>This is not about establishing trust, but about establishing in Europe a respect for Russia&#8217;s strengths and an awareness of Russia&#8217;s concerns.<br />
&#8230;<br />
The elegance of Medvedev&#8217;s strategy lies in the fact that simply causing the Europeans to think about Russian interests means that the Kremlin has driven a wedge not only between the Europeans and the Ukrainians, but between the Europeans and the Americans. If Russia is to recover what it has lost in geopolitical stature these past 15 years, this is precisely the sort of policy that will give it a fighting chance.
</p>
</blockquote>
<p>The entire article has more details regarding Ukraine&#8217;s motivations and calculations as well as its historic importance to Russia. Most interestingly it points to Yushchenko potential use of the gas issue as a way to play the &#8220;anti-Russian&#8221; card to boost his popularity for the upcoming March parliamentary elections. </p>
<p>If someone would like to see the article, please let me know and I can forward it. I am unsure if its available freely online.</p>
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