In a lecture at the Technion an expert from Stanford warns: There is a risk for conflict between the U.S. and China due to oil shortages

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So warns Professor Amos Nur of Stanford University’s Department of Geophysics, who gave a lecture at the Technion as part of the Nancy and Stephen Grand Technion Energy Program: “China and the U.S. compete in developing Middle East oil resources.” This issue has sparked eight wars in the last twenty years, from the Gulf War up to Libya, and according to Nur, the situation will worsen.

There is a high risk of conflict between two of the biggest economic powers in the world the U.S. and China as a result of the struggle for control of oil sources, if the leaders of these two countries do not manage the crisis sensibly. So warns Professor Amos Nur of the Department of Geophysics at Stanford University and a world renowned expert in the field of oil.

In a lecture he gave in the framework of the Nancy and Stephen Grand Technion Energy Program, Prof. Nur said that many wars have been sparked because of oil shortages, and just in the last twenty years there have been eight such wars. According to him, the objective of the First Gulf War had been to change the regime in Iraq the country with the second largest oil reserves in the world (Saudi Arabia is the largest), and privatize its oil sector. The September 11 attacks stemmed from Bin Laden’s disgust with the American support of the Saudi royal family, which controls the oil resources, and his demand for a more equal division of the Saudi royal family’s money.

The Egyptian crisis, which has led to a change in government, is also connected to oil. The population increase, on the one hand, and the dwindling of oil wells, on the other, changed Egypt in the last few years from an oil exporter into an oil importer, which means not enough revenue from oil sales for food subsidies. As a result, the prices of food doubled and gas prices went up tens of percent, fueling the masses’ anger with Mubarak. The fact that Libya is an oil exporter to the West has also been a reason for intervening in the present crisis. The West hopes to ensure that a democracy replaces Qaddafi, so that one madman does not control all of Libya’s oil reserves.

Energy in general and oil in particular are the largest economic sector in the world generating about 10 trillion dollars. Notwithstanding, oil resources are limited and the tendency is, with their discovery, to consume them rapidly. As a result, many countries are already producing as much as they can and the amounts being produced are decreasing. The U.S. reached its peak in 1971, and after its rising population curve and declining oil production curve met, the U.S. became an oil importing nation. Today the U.S. imports about two-thirds of its oil needs and in another decade this will reach 80%.

China, too, became an oil importer following the huge rise in its living standard. If in the beginning, China looked for and developed oil resources in relatively remote areas such as Darfur in Sudan, today it is competing with the U.S. in everything related to influence on oil resources especially in the Middle East. Hence, for example, China opposes sanctions on Iran in order to ensure itself oil.

 “In the end, if the crisis is not handled prudently, it is likely to lead to a conflict between the two superpowers,” warms Prof. Nur. “Whoever thinks that this is unrealistic should remember that the U.S. and Japan were not enemies prior to World War II, but the Japanese decided to destroy the entire U.S. navy stationed in the Pacific Ocean in the Pearl Harbor attack and risk war just to guarantee itself access to Sumatra’s oil wells. Rommel also did not just race to destroy the Jews in Eretz Yisrael but to get control of the Middle East oil wells, especially those in Iraq that had already been discovered in the 1920s.”

Prof. Nur added that oil and gas production all over the world is close to reaching its peak, with the net amount being pumped larger than the amount being discovered in new wells. And yet, in contrast to 1971when the U.S. started importing oil from the rest of the world, and especially from the Middle East, which sold its oil as a low price, today the world does not have surplus oil as it did in the 1970s, and as a result, the competition will increase.

Prof. Nur also related to the subject of alternative energy by saying that even if we exploit alternative energy sources such as solar, wind, bio-mass and even nuclear energy on a scale equal to our use of oil, gas and coal today, in 50 years we will still need the same amount of oil and gas we need today because demand will by 2.5 times larger than today.

In relating to the discovery of natural gas in Israel, Nur said that one can compare Israel today to Norway of the 1950s and its discovery of oil in the North Sea, and because of its democratic foundation, the gas revenues will, in the end, reach the public and not remain in the pockets of one family, as in Saudi Arabia. Nevertheless, Israel should keep its gas for itself and resist the temptation to export it and get a fast return on its investment, for two reasons to ensure that it has a stable energy source for many years and to create high value-added products and export them, which is a lot more worthwhile that gas that is sold at a relatively low price.

As far as regards the Technion’s energy program, said Prof. Nur, it is vital, given that one of the problems is that “Israel barely has enough people who are familiar with the subject and now with the discovery of gas reserves in the sea, suddenly we do not have the necessary technical labor force to develop these resources properly.”

Above: Head of the Energy Program at the Technion, Prof. Gideon Grader (right), introducing Professor Amos Nur before his lecture. Photo by: Yossi Shrem, Technion Spokesman’s Office