From this NYT article comes news of the oil giants' slowing clout amids the growing power of energy-rich nationalistic states. Russia, Venezuela and (curiously) Nigeria are cited as some of the examples.These states, while controlling the spigots, cannot function long without consumers. As such, Americans' consumption of those states' energy forges a vital link that those states simply cannot ignore. That link limits naked aggression and tempers aspirations to greater geopolitical influence.
What this means is that the energy survival of the United States depends less on the much-vaunted "energy independence," or energy nationalism, and more on a blunt-nosed, realistic engagement with these states.
Energy nationalism -- as shown by some states' control of energy production, and America's concerted push for ethanol -- is harmful to everyone involved if wielded poorly. Sovereign wealth funds also play a key role in either greater isolation or advancing market integration.
Sure, let America conserve and create new sources of energy. In the long term, it will pay off. But in the short term, the U.S. and other consumers should approach these producer countries as the sovereign states they are, and play hardball for the things that are needed.
Remember: For now, producers need consumers as much as consumers need producers. It's still the market game. Only the players have changed.
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