Oil and the U.S. foreign policy

Oil and natural gas play a major role in the formulation and implementation of U.S. foreign oil policy. It was emphasized that the U.S. oil policy will adjust in response to market developments, both political and commercial. It will also adjust to structural changes and constituency pressures. U.S. foreign oil policy has been drastically different in each of the last 3 decades. The 1970s were a period of oil crisis and shortage when OPEC producers were in control of domestic pricing and production. The defining moment was the Arab oil embargo of the United States and the Netherlands in response to the U.S. military resupply of Israel. After that moment, production and depletion policy shifted to sovereign rule. This embargo prompted many responses, one of which was the short-lived notion that the world would have to rely mostly on synthetics and alternatives to oil. The embargo prompted a multilateral consumer country cooperation, and a staged deregulation of U.S. oil prices. It also prompted a strong U.S. denunciation of Arab producers' use of the oil weapon for foreign policy reasons. The author described the many lessons learned from the 1970s and discussed the use of sanctions against Libya, Cuba and Iran and how these have become a tool to pursue U.S. national security interests or accommodate a domestic constituency. It was predicted that forthcoming changes in U.S. energy policy will reflect unilateral, bilateral and multilateral cooperation. It was noted that beyond the extensive trade and investment links between Canada and the United States, the additional Canadian component is the Alaskan gas line which is currently being considered. It was also noted that early administrative attention should be given to improving the intergovernmental relationship within the International Energy Agency