6. energy actors Flashcards
def of energy security (5 key points)
the stable and reliable supply of energy. It has several key dimensions:
1. Availability: (enough energy to meet demand)
2. Affordability (energy must be priced so that consumers and industries can afford it)
3. Accessibility (sources must be physically and economically accessible to all regions and populations).
4. Sustainability & Reliability (should be produced in ways that are environmentally sustainable and reliable over time)
5. Acceptability (Energy policies and sources must be politically and socially acceptable)
def energy
can be considered as a system with both:
1. technical components (for ex: refineries, and wind mills)
2. and social components (for ex: such as government policies, consumer behavior, employment in the energy sector, and regulations that shape how energy is used and distributed)
-> fosille or renewable for ex gaz, oil…
what is a ‘rentier state’
a state that relies heavily on income from the export of natural resources, especially oil and gas
-> EX: Saudi Arabia, Russia, Venezuela, and many oil-exporting countries in the Middle East and Africa.
what is the resource curse/ resource abundance or ‘paradox of plenty’
the idea that countries rich in natural resources often experience:
✅ Slower economic growth – They rely too much on resource exports and fail to develop other sectors.
✅ Lower levels of democracy – Governments often become authoritarian, using resource wealth to maintain power instead of fostering political participation.
✅ Higher risk of civil conflict – Struggles over control of natural resources can lead to corruption, inequality, and armed conflict (e.g., Nigeria’s oil-related violence).
EX: Venezuela – Rich in oil but suffers from economic collapse and authoritarian rule.
what is resources scarcity and what does it implies?
situation where demand for a resource exceeds its supply, leading to shortages, higher prices, and competition. The more limited the resource, the greater the potential for economic, political, and social tensions.
-> If resource demand continues to grow while supply remains limited or shrinks, societies may face intensified scarcity, competition, and possibly conflict over essential resources like food, water, and energy.
EX: Water shortages in the Middle East have led to geopolitical tensions (e.g., disputes over the Nile between Egypt, Sudan, and Ethiopia).
what is Malthusianism
population growth tends to outpace resource growth, leading to crises such as famine, conflict, and environmental degradation (resource scarcity)
energy poverty: def and its causes
the lack of access to sustainable modern energy services, such as electricity and clean cooking fuel. It disproportionately affects developing countries and low-income communities, limiting economic development and quality of life.
Causes:
1/ Lack of infrastructure (e.g., rural communities without electricity grids).
2/ High energy costs that make power unaffordable for low-income households.
3/ Political instability that disrupts energy production and distribution.
def energy equity, goals and challenges
the fair distribution of energy resources and affordability of energy services across different social and economic groups.
Goals of Energy Equity:
1. Ensure all communities have access to reliable and affordable energy=> Reduce energy disparities between rich and poor countries or regions.
2. Promote social justice by making clean energy available to low-income populations.
Challenges to Energy Equity:
1. Wealthier countries consume far more energy than poorer nations.
2. Energy transitions (e.g., shifting to renewables) may disproportionately benefit certain groups while leaving marginalized communities behind.
EX:The energy crisis in Europe (2022) caused energy prices to rise, disproportionately affecting low-income households
def tragedy of the commons + 3 possible solutions
concept that explains how individuals, acting in their own short-term self-interest, can deplete or destroy a shared, finite resource, even though doing so is harmful to the entire community in the long run.
-> If a resource belongs to no one (or is weakly regulated), everyone has an incentive to exploit it, leading to overuse and depletion.
EX: deforestation, overfishing…
possible solutions: Government regulation; Privatization of resources; Community-based management
renewable and non-renewable energy
renewable energy: energy derived from natural sources that are replenished at a higher rate than they are consumed
-> wind, solar, biomass, hydropower, geotermal
non-renewable: coal, oil, natural gas, nuclear
what are the “Seven Sisters”
a cartel of seven powerful Western oil companies who was controlling the global oil industry (oil exploration, production, refining, and distribution) from the mid 40’ to the 70’
-> sp in the M-E which has lots of resources
- Anglo-Iranian Oil Company (now BP)
- Gulf Oil (later part of Chevron)
- Royal Dutch Shell
- Standard Oil Company of California (now Chevron)
- Standard Oil Company of New Jersey (Esso, later Exxon, now ExxonMobil)
- Standard Oil Company of New York (Socony, later Mobil, also now part of ExxonMobil)
- Texaco (later merged into Chevron)
explain the origins/life of the seven sisters
1/ Before the 1920s: Oil production was fragmented, with many companies competing.
2/ 1928 : The Red Line Agreement – A secret agreement between major oil companies that divided Middle Eastern oil among them and prevented any single company from unilaterally exploiting resources.
3/ Post-WWII Expansion (1940s–1970s)
4/ Challenges & OPEC (1960s–1970s) – The rise of OPEC (Organization of the Petroleum Exporting Countries) in the 1960s and nationalization of oil industries in many countries gradually weakened Western oil dominance.
impact of the seven sister’s dominance
*Controlled Global Oil Prices
*Exploited Oil-Producing Nations – Middle Eastern and Latin American countries received only a small share of oil profits *Political Influence – Western governments often supported these companies’ interests through diplomacy and even military interventions (e.g., Iranian coup of 1953 to protect British oil interests).
*Rise of OPEC
decline of the 7 sisters
1970s Oil Crises – OPEC’s embargo and production cuts caused oil prices to surge, shifting power from Western oil companies to oil-producing nations.
+ Nationalization of Oil (1970s–1980s) – Many countries, including Saudi Arabia, Iran, Venezuela, and Iraq, seized control of their oil fields from foreign companies.
BUT the original Seven Sisters have merged and evolved into today’s oil giants,
what is OPEC: formation, aim, growth
Organization of the Petroleum Exporting Countries
-Formation:
*1960
* the Venezuelan Oil Minister, Pérez Alfonso, and the Saudi Oil Minister, Abdullah Tariki, took the initiative to form OPEC.
* founded by Venezuela, Saudi Arabia, Iran, Iraq, and Kuwait as the first members.
-Aim of OPEC:
*Initially: to reduce dependence on international oil companies by discussing royalties and tax questions, rather than being a cartel that set prices or quotas (asserting control over the oil resources within its member states).
-Growth of OPEC:
*Over time, OPEC expanded its membership and became a central player
*OPEC sought to ensure that oil-producing countries received a fairer share of profits from their natural resources.
OAPEC: formation, purpose, example
Organization of Arab Petroleum Exporting Countries
-Formation:1968
*following the 1967 Arab-Israeli War
*formed by Kuwait, Saudi Arabia, and Libya
-Purpose of OAPEC:
*primary aim: use oil as a political weapon. Specifically, it sought to restrict Arab oil exports to nations supporting Israel,
-Example: In 1973-1974, during the Yom Kippur War, OAPEC imposed an oil embargo on countries that supported Israel, leading to the 1973 oil shock. This embargo caused oil prices to soar, creating a significant energy crisis worldwide.
what was the Importing Countries’ Response to OPEC price wars and embargos
The International Energy Agency (IEA) (sp from the 73-74 crisis)
what is the The International Energy Agency (IEA)
-IEA’s Formation:
*nov 74
*created under the OECD (Organization for Economic Cooperation and Development) to improve oil supply security and counteract the influence of OPEC over oil markets.
-IEA’s Principal Functions:
*Oil Supply Disruptions: improve systems for coping with oil supply disruptions -> requiring member countries to maintain a reserve of oil equivalent to a specific duration of their net oil imports (originally 60 days, later increased to 90 days).
*Policy Development & Cooperation: forum for policy development, information sharing, and technology transfer among member countries to improve energy security.
*IEA’s Emergency Oil-Sharing System, which can be activated in times of crises. For example, in the wake of the Russian invasion of Ukraine (2022), the IEA coordinated the release of 62.7 million barrels from emergency reserves
what is the IEF: DATE, participants, role, significance
International Energy Forum
early 1990s
a dialogue platform for both energy consumers and producers.
Participants:
now over 80 countries, representing both OPEC and IEA members + major energy producers outside of OPEC (e.g., Russia, Brazil, Mexico) and significant energy consumers like India, China, and South Africa.
IEF’s Role:
forum for discussions primarily on oil markets but has expanded its focus to gas markets as well
Significance: less confrontational approach to the energy market and recognize the importance of cooperation to ensure long-term energy security.(from consumers and producers)
what is the global energy outlook
*fossil fuels remain dominant as they remain the most established and widely used forms of energy globally.
*energy demand growth: by 2040, global energy demand is projected to increase by 37% compared to 2012 levels (population growth and rising standards of living)
*investment needed: IEA estimates that to meet future energy demand, a cumulative investment of $37 trillion dollars will be required over the next 25 years (started from 2011).
*Energy Access and Poverty: Around 1 billion people still lack access to electricity in their homes + 75 million people who have recently gained access to electricity could lose the ability to pay for it
*Health Impacts: WHO-> approximately 4.3 million people die prematurely each year due to household air pollution
what is global energy governance
the processes and mechanisms used to make and enforce rules to address energy-related challenges that go beyond individual countries’ capabilities
growing role of non state actors
Challenges Managed by Global Energy Governance:
*Resource Scarcity:
*Soaring Oil Prices: Global oil prices have become more volatile, and price fluctuations can have a significant impact on global economies.
*Energy Poverty
*Climate Change: The energy sector is a major contributor to global greenhouse gas emissions, and managing this aspect is key to combating climate change.
Challenges with Current Institutions (to global energy governance)
*Limitations of Existing Energy Institutions:
Many of the current global institutions dealing with energy governance have limited membership and focus on a narrow subset of energy issues.
*Coordination between them is often lacking, leading to inefficiencies in tackling global energy challenges: energy lacks a comprehensive and effective global institution.
Why is Global Energy Governance Necessary?
*Transboundary Nature of Energy Challenges, meaning that disruptions in one country can affect many others.
*Oil Price Fluctuations: As global oil markets become more interconnected and sensitive to geopolitical events, price fluctuations have become more pronounced. No single country can avoid the impact of these changes. Therefore, a collective response through global governance mechanisms is crucial to maintaining energy security and stability.
