American Oil Diplomacy in the Persian Gulf and the Caspian Sea

"An excellent study of U.S. policy on creating and maintaining a state of energy security."--Hafeez Malik, Villanova University

The United States is the world's largest oil consumer and importer. Here Gawdat Bahgat examines the nation's growing dependence on fossil fuels--particularly oil--and the main challenges it faces in securing supplies from two energy-rich regions, the Persian Gulf and the Caspian Sea. He argues that long-term U.S. energy strategy must be built on diversity of both the fuel mix and the geographic origin of that fuel. It should include a broad combination of measures that would stimulate domestic production, provide incentives for conservation, promote clean technologies, and eliminate political barriers to world markets.

Bahgat also contends, however, that the goal should not be energy independence, but finding new ways of managing dependence on oil supplies from abroad. He maintains that despite increasing reservoirs of oil and natural gas throughout the world, including the Caspian Sea, the Persian Gulf will continue to be the main source of U.S. fossil fuel. Bahgat analyzes both recent and historical challenges to the relationship between the United States and Saudi Arabia, the world's largest oil producer and exporter, including the Arab-Israeli peace process. He also discusses the hostility between the United States and Iraq and the tense relationship between the United States and Iran, including such sensitive topics as the proliferation of weapons of mass destruction and terrorism, as well as developments in the wake of September 11, 2001.

In his assessment of the underdeveloped Caspian Sea reservoir, Bahgat suggests that energy experts and policy makers have exaggerated the region's potential, citing logistical, economic, and political obstacles that must be overcome before the region plays a major role in producing fossil fuels. These obstacles include domestic ethnic divisions, disputes over the legal status of the Caspian, disagreements over the most cost-effective transportation routes, and changes in the region in the aftermath of the war on terrorism.

Gawdat Bahgat, director of the Center of Middle Eastern Studies at Indiana University of Pennsylvania, is the author of The Gulf Monarchies: New Economic and Political Realities; The Future of the Gulf; and The Persian Gulf at the Dawn of the New Millennium.