Generals, and majors
Always seem so unhappy
’less they’ve got a war
XTC “Generals and Majors”, 1980
Oil is a conflict mineral: armies and wars to defend fossil fuel assets - particularly oil fields - have an annual cost of between $200B and $500B.
Liquid energy
As you stand at the gas station, feeling the cool gasoline rushing through the hose into the fuel intake on your car, you’re enjoying the fruits of the great portability and density of liquid fuels. Inside your car, it means the fuel can be pumped from the gas tank and sprayed into the engine’s spark cylinders; outside the car, it means the fuel can be transported from distant refineries in gas tankers, and carried as crude from distant oil fields by goliath boats.
This is liquid energy.
It’s such a remarkable thing, that wars have been, are being, fought over it. The costs of these wars is itself remarkable - surely running into trillions of dollars per decade. It’s mind-boggling.
Liquid energy, oil, is valuable, but quite scarce. Not scarce in the sense that there is not much. Scarce in the sense that it’s spottily distributed around the earth. Consider: there are trees and forests nearly everywhere - except the great deserts, or where there are lakes and seas. Coal mines, similarly, are nearly ubiquitous. The industrial revolution arose on coal mining and the use of coal to melt iron alloys. Coal is found in Britain, France, Germany, Poland, Russia and China and Australia and in many parts of the Americas and in many other places. Coal forms wherever plants were buried in sediments in ancient swamps, but the same is not true for oil or large reserves of natural gas.
Oil, today is found beneath desert sands, in shallow and deep seas, off the northern slope of Alaska. Oil is geographically scarce because the processes that yield it are quirky and unusual-it’s only where there was once a shallow, stagnant sea with lots of vegetation. These shallow seas periodically form and disappear as continents drift apart and move together again over aeons. Then, several, quite specific conditions must exist for oil and natural gas to form. Key is the build up of a sludge of algae and other microorganisms. Then, river silt must capture the microorganisms: this occurs where rivers empty into the seas. Finally, these layers of dead microorganisms must be subjected to the right conditions—high pressure, temperatures to about 150 degrees, for a few million years. That prolonged pressure-cooking drives the reactions that convert the complex organic compounds of the silt-organism mix into crude oil. At higher temperatures, to about 200 degrees, the result is natural gas.
And thus we get the combination of a highly valuable, easily portable resource, found under unusual geographic circumstances. It’s enough to go to war to defend. It’s enough that defending Middle Eastern oil, and determining who has access to it, has for decades been a central theme in US policy.
The Carter Doctrine
In 1980, President Jimmy Carter and his foreign secretary, Zbigniew Brezinski, made it clear that it would defend USA access to Middle Eastern oil as if it were sovereign to the USA itself:
“The region which is now threatened by Soviet troops in Afghanistan is of great strategic importance: It contains more than two-thirds of the world's exportable oil. The Soviet effort to dominate Afghanistan has brought Soviet military forces to within 300 miles of the Indian Ocean and close to the Straits of Hormuz, a waterway through which most of the world's oil must flow. The Soviet Union is now attempting to consolidate a strategic position, therefore, that poses a grave threat to the free movement of Middle East oil.
“This situation demands careful thought, steady nerves, and resolute action, not only for this year but for many years to come. It demands collective efforts to meet this new threat to security in the Persian Gulf and in Southwest Asia. It demands the participation of all those who rely on oil from the Middle East and who are concerned with global peace and stability. And it demands consultation and close cooperation with countries in the area which might be threatened.
“Meeting this challenge will take national will, diplomatic and political wisdom, economic sacrifice, and, of course, military capability. We must call on the best that is in us to preserve the security of this crucial region.
“Let our position be absolutely clear: An attempt by any outside force to gain control of the Persian Gulf region will be regarded as an assault on the vital interests of the United States of America, and such an assault will be repelled by any means necessary, including military force.”
Subsequent USA governments have modified, extended and generally strengthened the Carter Doctrine: it is now a central part of USA foreign policy.
This brings the inevitable and terrible consequence: that when securing oil is seen as a vital security interest of a well-armed country, men and women will suffer and die, bravely in defense of their country and oddly in defense of oil. We can tally the financial costs of wars and armies to defend oil; we can not tally and must respect the lives lost and the lives ruined in the same ways.
There is also a complex, philosophical and financial challenge here, that will be difficult to untangle. The financial challenges include that a large part of the world’s spending on military might is associated with defending oil assets. This, by one remove, means a nation’s ability to secure its own sense of autonomy, is threaded through with oil spending, as an addict cannot distinguish between the drug that destroys him and that which sustains him.
But we cannot escape that the vast scale of use of oil, and the vast sums spent defending or fighting for oil still leave us with the fact: oil is a conflict mineral.
For freedom! For oil!
It’s no easy feat to create a non-controversial estimate for how much armies and wars cost to defend, or win, fossil fuel assets. Countries don’t normally publish detailed tallies of how much their military adventures cost. And they certainly don’t brag about how important oil is in their war-waging: imagine the pre-battle scene, pennants flying, nervous troops being urged on by stirring speeches ending with “For country! For freedom!! For oil!!!”
No, wars are ostensibly fought over other pretexts - territorial integrity or avenging some slight, or neutralizing some theat. But, really: Oman’s civil war erupted only after the discovery of oil - in the country’s barren sector which had been, previously, set aside as a religious, non-industrial region. The Iran - Iraq war, often considered to have the USA as a sponsor, was fought between two oil states. Iraq’s invasion of Kuwait. The war between the north and the oil-rich south of Sudan. And, of course, the big one: the US - Iraq wars.
Now, ostensibly the second, largest US-Iraq war was somehow a consequence of the (mostly Saudi-sponsored) 9/11 attacks on the USA, or somehow a preventative against a planned weapons of mass destruction capability (which was not there), or somehow about Iraq’s Muslims endemic hatred of the West’s freedoms. And somehow we’re to overlook the claims that taking Iraq’s oil fields would pay for the war, and the swift actions by the invading forces to secure the oil fields (not the arms of the opposing forces or the key cultural sites). And that US Vice President Cheney had a dog in the fight - as an officer of Halliburton Corp., a major oil field services company, which he rejoined after the war and whose post-war work made it, and Cheney, very wealthy (even as Halliburton moved its corporate headquarters to Dubai, from Texas) and that Cheney urged war against Iraq in the immediate aftermath of the 9/11 attacks, even before anyone had concluded where the attacks originated. Let’s forget these, at least let’s pretend we can forget the emotional and visceral and political aspects of these.
How many trillion dollars?
Two thorough, well-founded analyses frame the estimates of the military and related costs of defending, winning, securing oil fields:
The 2010 published analysis by Roger Stern of Princeton University: United States cost of military force projection in the Persian Gulf, 1976–2007. This analysis looks at the total cost the USA alone has borne to keep its military presence in the Middle East. The summary conclusion: “For 1976–2007 CPGfp is estimated to be $6.8T and for 2007 $0.5T (2008$)”
The Costs of War project at Brown University’s Watson institute has built a detailed, long-term analysis of the costs of the US-Iraq war. Its conclusions: the total accrued cost of the USA war on terror, post the al Qaeda-sponsored 9/11 attacks is $6.4Trillion - to which needs to be added a future $8Trillion, over the next 40 years as interest payments on the costs paid so far.
Some important details:
The Stern / Princeton estimate excludes costs borne by others, including but not only US Allies (e.g. the UK in the Persian Gulf) and there is no consideration of US-borne costs elsewhere in the world.
The Watson Institute estimates include costs that are not as reasonably associated with fossil fuel interests - the long war in Afghanistan, and fighting in Syria and other countries.
Neither estimate considers the costs borne by Iraq itself. Nor do they add costs borne by others. Or look at costs associated with military forces to defend fossil fuel assets elsewhere.
And so:
We can take the Princeton estimates as is, and leave it as is, an annualized $217 billion, for the low estimate (noting that this is annualized over 30 years, including decades before the post-9/11 conflicts), or create a high estimate by assuming that the USA shoulders 80% of the annual cost of Persian Gulf projection, and that the Persian Gulf is itself 80% of the cost basis of worldwide fossil fuel military projection. That higher number is $0.5T / (0.64) = $0.78T. The Princeton study has a single-year estimate of $0.5T for 2007, which is perhaps the best average number.
We can take the Brown / Watson estimate as is - also a current $0.5T, but reduce by 40% to consider only costs outside the Iraq war, to $0.3T, but then add in, again, a similar percentage to consider other wars, costs borne by other actors, etc. So, again $0.5T.
So, a low, low estimate of $220 billion a year, an average perhaps of $500 billion a year.
These costs are almost entirely externalized from the ledgers of the fossil fuel industry, and are borne via taxpayers through increased military and other costs. In particular, the highest part of these costs is borne by US taxpayers.
“Clean energy” conflict minerals
There are some key elements of the new world of clean energy that are spottily available, and where conflicts are possible, or already underway. Some really are conflict minerals, including Uranium, Cobalt and, potentially Lithium. Cobalt, widely used in batteries, is mined (alongside Coltan, the ore for Niobium, also known as Columbium, and Tantalum) under awful circumstances in war-torn eastern regions of the Democratic Republic of the Congo. There is little dispute that the circumstances are dire, and that the high revenues associated with these precious ores are at the heart of the disputes.