Sovereignty under threat

During the 1970s, OPEC achieved a significant turnaround in the correlation of global forces. For the first time ever, the oil-producing countries in the South were in a favorable position. It managed to limit the colonial model of appropriation of raw materials.

Through a process of nationalization of hydrocarbons and the creation or strengthening of state-owned companies, no other group of countries that produce such strategic raw material had been so successful in safeguarding its natural resources, both from an economic and a sovereignty point of view.

However, with this triumph, all the member countries of the OPEC entered, at their own risk, into the core of a global technical pattern, created from and for the benefit of the central countries. They thereby started to have a direct dependence on the global functioning of the industry, its finances and its technical-scientific system. Thus, their possibilities of keeping a favorable correlation of economic forces within the current oil civilization were really only fleeting.

It is no coincidence that most of the technical, economic and social victories achieved by the oil-producing countries of the South, whether or not members of the OPEC, have started to fade away since the mid 1980s, both on sovereignty aspects and in the search for the welfare of the countries that possess such a fundamental resource.

The strategy of the northern countries, and their respective private companies, was centered in the creation of the International Energy Agency (IEA), which was able -since 1985- to fracture OPEC’s agreements, and to consolidate the mediator function of the transnational oil companies and oil-services providers. In this way, they managed to effectively stop the flow of excess production to the South thus ensuring a huge wastefulness of energy in the countries in the North.

Transnational companies have recovered much of the space they had lost during the 1970s when OPEC was created. They have recovered direct control over the oil companies and deposits, or they have managed to achieve an increasing number of guarantees that allow them to occupy tactical spaces both locally and internationally. As a result, they are currently more influential within OPEC and are re-taking an increasing control over that wealth which they had momentarily lost.

Faced with this situation, most of the state-owned companies, whether or not members of OPEC, have been unable to stop or isolate effectively the intervention of the transnational oil companies. On the contrary, the latter are advancing both in the strategic area of services and in the processes of reform and adjustments imposed on our countries by the multilateral banks, fostering the dismantling of the national companies.

Despite OPEC’s initial efforts, once again the transnational companies are deciding the energy policies in all the oil-producing countries in the world. One example would be the fact that the directors of Halliburton, Exxon-Mobil and Chevron-Texaco are extremely powerful inside the government of the United States – the main oil consumer with a deficit – and since they are the people who hold all the information on the reserves of the planet, they are the protagonists of the wars for the conquest and control of the resource.

However, with the arrival of the new century, this world that has been created to be the image and resemblance of the oil civilization, is reaching two important limits: first, the global depletion of reserves, especially in small and medium oil-producing countries and secondly, the catastrophic exhaustion of the planet’s environmental ability to support more burning of hydrocarbons.

Faced with an environmental crisis, the companies are preparing their strategies to enter into the business of “alternative” energy and are setting the bases to control the energy market through Public-Private Partnerships and other mechanisms. The fact that the companies that pretend to control oil today are the same companies that are now getting hold over the energy services means that there will be serious economic, social and environmental implications for the southern countries. This is a challenge that OPEC will have to face.

In the meantime, the technical, industrial, economic and financial problems faced by OPEC countries prevent them from entering into the field of research and change to energy alternatives adapted to the characteristics of their own countries.

An In-House Environmental Crisis

We have started the new century with severe environmental problems. Climate disasters, which are ever more frequent, intense and uncontrollable, are affecting the planet as a whole.

To the environmental vulnerability faced by OPEC’s members themselves, we need to add a series of steps taken by transnational companies and by strong consumer countries that are jeopardizing the spirit in which the cartel of producing countries was created in the first place.

Two scenarios where the pieces of the puzzle are moving dangerously against OPEC members are Environment and Economics. The immediate benefits from the policies on crude oil prices and its derivatives are really contradictory to the progressively disastrous effects in the middle and long terms.

OPEC’s country members are already facing the impacts of climate change generated by the oil civilization. We only need to remember the Vargas disaster in Venezuela, caused by totally unpredictable rains, or the forest fires in Indonesia and other countries in the region, caused by droughts.

We certainly need to add to these problems the local environmental impacts caused by the extraction, transportation and refining of crude.

Countries with arid and semiarid ecosystems are suffering, due to climate change, an increase in the desertification process; they are losing the little amounts of agricultural lands they have, and their scarce sources of water are being polluted.

On their part, countries with rainforests are rapidly losing their biodiversity, a strategic resource, and they are also facing the pollution of their water sources.

In addition, the local impacts of oil activities generate discontent among the population, leading to protests –legitimate from the communities’ perspective- which governments must face.

Three countries, members of OPEC, are the main concern of Oilwatch because they are tropical countries with oil production: Nigeria, Indonesia and Venezuela. The situation in these countries is critical, there have been threats of invasion, the sources for survival of the populations are being destroyed, the transnational companies are rapidly gaining space, and they are destroying the resources that will guarantee the wellbeing of their people in the future.

Regaining sovereignty, the establishment of a policy of reinvestment and control of excess production, and the setting of conditions to develop a new post-oil civilization, are undoubtedly imperative to achieve the objectives set to protect these countries and their inhabitants.

If not, all these countries will find themselves with a huge ecological and social debt and an accumulation of externalities that no one will know who must pay. Our legacy will be ruin and economic and environmental decadence and dependence, which will be as fast as the punishment imposed on these countries by climate change.

For all the above, Oilwatch proposes the following:

To open up a dialogue on sovereignty and privatization, on the short and long term and on social, economic and climate justice.

To start a discussion on a post-oil economy, where alternative energies are controlled and provided by States and which can identify solid bases to sustain energy sovereignty and social and economic well-being.

To reflect on the precautionary principle, already included in the most important international conventions, and to start adopting it progressively among OPEC countries and the rest of the nations in the world. A disregard of this subject would mean to move ahead without addressing the problem of an uncertain future.

To open up a debate among the tropical countries that are members of OPEC on the broader ecological and economic benefits of safeguarding the underground oil as a way to preserve biodiversity, to contribute to address climate changes and to gear their policies towards sovereign and non oil-dependant nations.

To avoid the criminalization of protests and resistance by local communities that denounce the impacts of oil activities, because they are defending the rights of the people, the countries, and the planet.

For the planet and its people.

Oilwatch