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Geopolitics – Energy & the Environment in Times of Conflict – Maureen McCall

Maureen McCall

Canadians woke up to a new geopolitical reality last Friday morning, only three days into the New Year and a new decade. The US airstrike in Iraq that killed Qassem Suleimani has raised concerns that the escalation of the US-Iran conflict could disrupt crude oil supply. The conflict has pivoted the focus of public concern to discussions of global security and energy security issues. Matthew Bey, senior global analyst at Stratfor speaking to a CNBC reporter advised that ­­­­­Iran is likely to return to backing attacks on oil infrastructure in the Persian Gulf and the rest of the Middle East. Tehran could also consider attacks on Saudi Arabia’s oil infrastructure if tensions escalate, attacking major choke points that would “take months to rebuild” in Saudi Arabia, he said. 

As the Middle East has long been regarded as the world’s most important crude oil-producing region, the magnitude of the disruption that could ensue will be considerable. It could disrupt oil supply and the economies of many countries. This includes Canada, who still utilizes Middle East oil supply despite our considerable domestic oil and gas resources. Once again, we are reminded of the intrinsically geopolitical nature of oil and gas resources. Retired General David Petraeus, former commander of US Forces in Afghanistan commented about  Soleimani’s killing in an interview with Marco Werman of The World publication saying: ‘It’s impossible to overstate the significance.  This is much more substantial than the killing of Osama bin Laden. It’s even more substantial than the killing of Baghdadi.”

The intent of the regime behind Soleimani is disruption of multiple countries in the Middle East and beyond through “proxy wars”- providing varying degrees of support to opposing sides in conflicts, including the civil wars in Syria, Yemen, Iraq, and extending to disputes in Bahrain, Lebanon, Qatar, Pakistan, Afghanistan, Nigeria, and Morocco, as well as broader competition in North and East Africa, parts of South Asia and Central Asia. In the interview, Petraeus outlined the disruptive actions that could be pursued by Iran in retaliation. “Now, obviously, there is a menu of options that they have now and not just in terms of direct Iranian action against perhaps our large bases in the various Gulf states, shipping in the Gulf, but also through proxy actions — and not just in the region, but even in places such as Latin America and Africa and Europe.”

In the past decade. lack of awareness of the depth of Mid East conflict has allowed us the luxury to contemplate energy disruption in Canada. We could entertain overstatements about climate emergencies, examine scientific data at our leisure and welcome activists who lectured us on climate “truths”. We could be vague about the accuracy of data interpretation and predictions. We could fail to question the impact of tight timelines set by overzealous politicians. We could set climate targets that tax our industries and citizens to ease our collective conscience by sending money to our Federal government who has ill-defined plans to affect change. We could engage in debate on timelines for a climate point of no return and point fingers at the worst offending countries only to watch Federal politicians point fingers back at us- the average Canadian.

Canadians should not underestimate the geopolitical nature of energy and oil and gas resources. Canada has been the target of undue criticism because of geopolitical rivalries and the value of our immense oil and gas resources. Is there intention behind this intense focus? Have we made ourselves a soft target? Canada has a wealth of domestic natural resources that we can develop responsibly while being mindful of carbon efficiencies and with excellent environmental stewardship. We also have a huge wealth of technology talent and initiatives. We can and should develop our supply for the stability of our economy and for our country’s future and yes, to provide for our children’s futures. In 2020, Canadians wrestle with the realities of vulnerable jobs, the challenges of the flight of capital, increasing household debt levels, increasing deficits, and massive societal changes to the workforce. In the face of these realities, maybe climate change initiatives that tax the average Canadian should become less critical. For many Canadians, climate change focus has been replaced by real fears of job loss, of diminished opportunities for the growth of personal wealth, of the prohibitive cost of home ownership, of rising household debt and of the decline of the Canadian dream.

Perhaps the start of 2020 is an inflection point where we pivot from climate obsession to very real and balanced discussions of stimulating the Canadian economy, of energy development and security and of environmental stewardship. Yes, energy resources are geopolitical, and Canadians are uniquely equipped to manage them responsibly. So, here’s to a new focus and balanced discussion for Canadians in 2020 and the start of a prosperous decade.

Maureen McCall is an Energy professional with experience working for IOCs in Canada. She is an contributor and currently serves on the Board of Directors of the Petroleum Joint Venture Association.

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