John Robb: A Shadow OPEC

18 July 2004

New Posting from John Robb’s Global Guerrillas.

Over time, these global guerrilla operations may yield enough control over global oil supply to replicate the power of OPEC.

One potential target region is Caspian Sea oil—particularly from Kazakhstan and Azerbaijan...Given this sparse and undefendable network, the potential for GG control of oil production from the Caspian region is extremely likely. There is also the potential for cascading failures with the right analysis.

Growth in the global demand for oil (particularly from China) and the ongoing disruption of Iraq’s oil has reduced excess global production to less than 750,000 barrels a day. This makes even small disruptions in production extremely potent as a means of controlling oil prices.

Good analysis of the vulnerabilities, all of which add up to more price instability—and that’s before factoring in potential peak production issues. We also need to begin thinking about the increasing centralization of new energy projects—such as Qatar’s coming Ras Laffan LNG complexes, or the new work in Russia on Sakhalin island. The Global Guerrillas thesis paints a picture of ongoing geopolitical instability based on these new terror networks, the proving ground of which is Iraq.