Oil carries a curse of its own

Published August 24, 2004

RIYADH, Aug 23: Oil, many say, carries a curse of its own. It has, in past and in present days, been responsible for the "crude attention" of the unwanted. Many say it is responsible for many a war and tragedies of today's world.

History and politics continue to underline the theme. Perception stays, despite denials and contradictions, that the issue of energy security had played a significant role in the US decision to take a lead role in reversing the great injustice Saddam had done to Kuwait in August 1990 by invading it. Had there been no oil, the US may not have been seduced to take on the invading Saddam forces, as it did in February 1991, many strongly believe.

Similarly, the impression stays that the oil riches of Iraq, believed to be second only to Saudi Arabia, played a very significant role in the US decision to wage another war on Iraq in 2003.

One indeed cannot out rightly reject these common perceptions. Energy security is a cause of prime concern to the policy-makers in Washington and elsewhere in the global capitals, and they definitely do not want to take any chances with it.

While the world is faced with growing concerns about security of supplies from this major energy producing part of the world, for scores of reasons, there seems to be rush to secure and diversify energy resources. Oil is sucking global powers into this "great game of the 21st century".

In the recent days, Darfur, the western part of Sudan, has been very much in news. Sudan, an Islamic country, is faced with a civil war and currently is the focus of attention of the US and the rest of the world. US Secretary of State Colin Powell has expressed the determination of the administration to resolve the crisis.

However, Sudanese President Omar Hassan Al Bashir recently accused the Western nations of interfering in its troubled Darfur region so as to exploit Sudan's gold and oil resources, to their benefit.

Sudan's neighbour Chad has emerged as a big oil producer in the past decade. Sudanese officials believe that the troubled region of Darfur is floating in oil. The country already has one of the fastest growing oil sectors in the world.

Production grew four fold between 1999 and 2003, and official figures estimate recoverable oil reserves at over 2,000 million barrels and proven reserves at 700 million barrels.

The completion of a 1,540-km pipeline to the Red Sea port of Bashair, about 25 km south of Port Sudan, in August 1999 transformed the country from a net importer of hydrocarbons into a substantial exporter.

According to UK's Wood Mackenzie, production rose to 250,000 barrels per day (bpd) from just 12,000 bpd in 1997. Wood Mackenzie forecasts an average production of 310,000 bpd in 2004 and 418,000 bpd the next year. However, some Sudanese sources project the 2005 average crude production to be around half a million bpd.

In the absence of some major well-known western oil majors in Sudan, companies from China, Malaysia, Britain, Italy, India, New Zealand, Malaysia, Pakistan, and Qatar are active in exploration activities in the country.

Hence, when President Omar Hassan Al-Bashir says that the Western powers are trying to interfere into its internal affairs because of the oil wealth in the troubled region, he indeed has a point to put forward.

And this is not peculiar to Sudan. Not long ago, another Islamic country, Indonesia, was forced to let East Timor secede. This was forced upon Jakarta, despite the vow by the then US President Clinton that the era of changing geography by force has already gone by. Yet the geography of Indonesia was changed!

And some suggest that the energy riches of the region were one of the major factors that influenced the equation, prompting Australia to take a lead role in the East Timor affairs.

There have been speculations that in the aftermath of the independence from Jakarta, East Timor was blackmailed and pressure was exerted on the newly-independent country to sign an energy resource sharing deal with Australia - its benefactor in some ways.

The issue of maritime boundaries and the distribution of royalties from the gas fields of the Timor Sea - separating Australia and the East Timor - has been a bone of contention between the two countries for some time. In question was the Greater Sunrise field, some 150 km from East Timor, estimated to contain 8.35 trillion cubic feet of gas.

There have been speculations that one of the reasons behind the Australian 'goodwill and humanitarian' decision to deploy their forces in East Timor was to get the deal signed on the terms which they were unable to get from Jakarta.

Indeed the curse of oil and gas played its due role in this episode as well. Similarly, the staunch support of the former Aznar regime in Spain for the US government in its war against Saddam also had an oil connection.

Former Spanish Defence Minister Jose Bono, of the now toppled Aznar government, is on record to have said that Spain was awarded the purchase rights for 15 million barrels of Iraqi crude oil reserved for Spanish energy firms Repsol YPF and Cepsa as an upside to his country's participation in the get-Saddam-campaign.

Indeed a number of tragedies that have occurred to a diverse range of people in various parts of the world was because of the oil and energy riches they have, one has to concede - though reluctantly. Oil definitely carries a curse of its own!

Opinion

Editorial

Centre vs provinces
Updated 10 Jun, 2026

Centre vs provinces

The reason the centre finds itself in this position is rooted in its failure to expand the tax net and boost revenues.
Party in crisis
10 Jun, 2026

Party in crisis

THE young KP chief minister must be starting to realise just how thorny a seat he occupies. There has been a flurry...
Varsity woes
10 Jun, 2026

Varsity woes

FINANCIAL crises affecting public sector universities across Pakistan are now having an impact on academic...
Doctor attacked
09 Jun, 2026

Doctor attacked

AN act of reprehensible violence has shaken the medical community. On Saturday, an employee of the Provincial Civil...
AJK flare-up
Updated 09 Jun, 2026

AJK flare-up

The situation started deteriorating after a trader affiliated with the JAAC was reportedly shot in an altercation with law-enforcers.
Fault lines
09 Jun, 2026

Fault lines

THE April 8 ceasefire that halted hostilities between Israel and Iran has encountered its most serious test yet....