Compare how the supply and the scarcity of natural resources influences the conduct of contemporary conflict.

Robin Solomon (rs342), IR5001, November 2005

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Summary

This essay examines the role that the natural resource of oil, both its abundance and scarcity, has on contemporary conflict. Conflict for the purposes of the discussion is broadly defined to include violent and non-violent interactions, involving states and non-state organizations. The major theories informing the study of natural resources and conflict are reviewed and their findings with respect to oil are cross-examined. An overview is provided of the unique characteristics that shape oil related conflicts. Finally, the current geopolitical environment surrounding oil dependence is analyzed; with an emphasis on non-violent conflicts emerging from competition for scarce oil resources that could in the next decade become violent.

Contemporary conflict and security within the natural resource context

The bi-polar balance of power between the U.S. and the Soviet Union has yielded to a multi-polar environment where asymmetrical conflicts are more likely to arise. The black and white picture of conflict in the Cold War, in which enemies were clearly defined, is now largely grey and arguably has left “the overall state of current conflict typology in a state of confusion”[1] and has ushered in a “new world disorder.”[2] Conflicts are still driven by differences in ideology but are increasingly characterized by a more complex set of underlying causes including but not limited to: ethnicity, culture, religion, and nationalist/separatist ideology.[3]

War is typically defined as military engagement conducted between states involving greater than 1,000 casualties.[4] Conflict, however, can be inter or intrastate, high or low intensity[5] and may or may not involve the military. Conflict can be violent but can also be based solely on discordant dialogue. As articulated in the book, Contemporary Conflict Resolution, there is not a simple definition.[6] While conflicts involving oil may have originated long before the break-up of the Soviet Union, the conflict dynamics examined in this essay are largely related to the post-Cold War period. The author considers that conflict can be intra and/or interstate, involve non-state players, can be violent and/or have the potential to become violent. However, conflict also can be non-violent and be predominately viewed as geopolitical posturing through a state’s projection of military force capabilities, formation of geostrategic alliances and rhetoric. Throughout this essay, the term supply is used interchangeably with abundance and scarcity is often referred to in terms of resource dependence.

The break-up of the Soviet Union has led to constantly changing political, economic and social environments where globalization and economic development play an increasingly important role in shaping conflict dynamics, including onset, duration and resolution. The landscape of contemporary conflict is distinguished by some of the following elements (illustrative):

  • Access to information and communication technologies;
  • Globalization of economies (i.e. increased interdependence and ease of transnational shipments of commodities);
  • Availability of sophisticated military technology and hardware;
  • Sophistication of international financial networks;

In the past, states primarily had access to military and civilian technologies. In contemporary conflicts, however, especially civil wars in oil rich countries, both rebel groups and governments can access sophisticated financial, military, information and transportation networks.

Two fields of security studies, environmental and economic, have become associated with natural resources and conflict. The security lexicon and the environmental lexicons are very different and as Lorraine Elliott notes in The Global Politics of the Environment, one “can’t just militarize environmental politics or demilitarize security thinking.”[7] While both elements of security studies are vital to addressing post-Cold war natural resource conflicts,[8]/[9] the economic security field has developed a more dynamic body of research on oil. This body of research has examined how the need for secure supplies of oil shape security strategies and elements of conflict of oil dependent states, and has undertaken in-depth research on conflict in states that have an abundance of oil.

The U.S. ‘securitization’ of oil began in 1980, after the oil crises of the 1970’s and the Soviet invasion of Afghanistan. U.S. President Jimmy Carter decided oil was a strategic resource vital to U.S. security. In what has become referred to as ‘The Carter Doctrine,’ he asserted “Any attempt by an outside force to gain control of the Persian Gulf region will be regarded as an assault on the vital interests of the United States of America…[and] will be repelled by any means necessary, including military force.”[10] President Carter laid the foundations for the development of a significant U.S. military infrastructure in the Persian Gulf to address potential and actual conflict in the region.[11] By linking the supply of oil to national security, the dynamics of conflict around oil changed. The Carter Doctrine made it possible for the U.S. to go beyond traditional diplomacy by justifying pre-emptive strikes and implementation of defensive military measures.

The conflict landscape linked to oil dependence by industrialized states is extremely complicated. Primarily non-violent conflict dynamics are constantly evolving amongst powerful nations as they vie for control over scarce oil resources critical to their economic survival. The recognition of the need to secure energy supplies from areas characterized by conflict is evident in the U.S. National Energy Policy (NEP), published in May 2001. The NEP acknowledges that the Persian Gulf will “remain vital to U.S. interests” and emphasizes the importance of the “Western Hemisphere, Africa and the Caspian” to help meet increased U.S. oil demand.[12] The U.S. is not alone in acknowledging the link between oil dependence and security. The European Union, United Nations and the North Atlantic Treaty Organization have embraced environmental security, including natural resources, as a strategic concept.[13]/[14]

Major Theories on the Role of Supply and Scarcity in Natural Resource Conflicts

There is a substantial body of evidence “that resources and civil wars are causally linked.”[15] Different scholarly schools of thought have different ways of examining the causal relationship between natural resources and conflict. In order to understand the relationship of oil and conflict, it is critical to examine the primary theories informing the debate on the causal links; typically referred to as ‘greed versus grievance’ and a further school of thought ‘beyond greed and grievance’.

Grievance

Academics and policy specialists from one school of thought argue resource scarcity drives conflict through grievance; resource scarcity can cause citizens to grow disillusioned with state leaders, this disillusionment can turn into grievance which in turn can lead to violent conflict. Thomas Homer-Dixon, the “Toronto School,” and Robert Kaplan[16] are recognized leaders in the field of grievance studies. While often a source of conflict, resource scarcity argues Homer-Dixon can sometimes be turned into a benefit for the state by promoting: innovation (alternative energy), government accountability (taxation required instead of money from sales of resources), and investment in human capital. (SOURCE) According to the grievance school of thought, “scarcities of renewable resources do produce conflict and instability. However…the mechanisms by which this happens are complex and environmental scarcity essentially produces conflict by generating social effects, such as poverty and migrations.”

There are limitations with Homer-Dixon and the grievance school’s approach, however, when examining the dynamics of oil and conflict. Grievance studies have largely been based on the assumption that non-renewable natural resources are in oversupply and therefore do not influence conflict.[17] They have focused primarily on developing countries in the southern hemisphere, where conflicts tend to be intrastate and violent, and thus there is limited grievance research on interstate wars such as the Iraq-Kuwait War (1991) and the Iraq War (2003). By focusing on scarcity in developing countries, this school pays less attention to resource dependence in the industrialized world, and its potential to influence conflict, especially non-violent. Finally, the notion that there is an oversupply of oil is inaccurate (see pages 14-16).

Greed

The field of political ecology[18] has emerged to examine the role of natural resource abundance rather than scarcity in conflict. Political ecologists generally argue abundance (greed), not scarcity (grievance), is the main cause of natural resource conflict. Conflict theory related to natural resource abundance is also referred to as the ‘paradox of plenty’ or the ‘resource curse’.[19] Paul Collier and from the World Bank, and Philippe Le Billon from Oxford University, are widely credited with developing what has come to be termed the study of ‘political ecology’.

The research undertaken by political ecologists indicates resource rich countries are 20% more likely to go to war than countries that have a scarcity of resources.[20]/[21] In the case of resource abundance, governments obtain ‘rents’[22] from natural resources such as oil and the negative consequences on governance and societies can be tremendous. “Through a ‘renter’ effect, governments can rely on fiscal transfers from resource rents, rather than statecraft, to sustain their regime. Rents from oil are considered “differentially important in conflict risk.”[23] The income generated from oil exports can create an enmeshed network between governments, private companies and in some cases even guerrilla organizations as well as promotes a system of patronage and even in some cases prolong conflict.[24]/[25]

Philipe Le Billon in his Adelphi Paper, “Fuelling War: Natural Resources and Armed Conflict”, assesses conflicts in accordance with a matrix based on resource characteristics. Le Billon asserts “the specific characteristics of a resource, its location and its mode of exploitation can affect the balance of power between belligerents.”[26] He examines the prevalence of different types of conflict (i.e. state control/coup d’etat, secession, peasant/mass rebellion and warlordism) through the prism of two sets of resource characteristics: geography - whether the resource is proximate (i.e. easier for governments to control) or distant (i.e. remote locations near porous borders); and exploitation characteristics - diffuse (i.e. across broad swaths of land such as crops, timber or gems) or point (i.e. located in single locations such as oil and gas). Le Billon characterizes oil as a point resource that can be both proximate and distant. His study of specific oil conflicts leads him to conclude they typically involve governments. Examples of violence related to state control of oil include: Congo-Brazzaville, Colombia, Iraq-Kuwait, and Yemen. Conflicts resulting from secessionist movements include: Angola, Chechnya, Nigeria and Sudan.

One of the best known and most widely quoted statistical models created to study the role of natural resources in conflict was developed in 2003 by Paul Collier and Anke Hoeffler for The World Bank. Their economic model of civil war based on quantitative empirical analysis considers a range of issues: initiation, duration, repetition, costs, and post-conflict recovery.[27] Of the multiple factors examined, three had the most statistical relevance: level of income per capita, rate of economic growth and structure of the economy, namely dependence on primary commodity exports.[28] Specifically regarding vulnerability to conflict, Collier and Hoeffler reached the conclusion that resource abundance creates four conditions, which can sow the seeds for civil strife. These include economic growth collapse, low educational attainment, a large cohort of unemployed young males and high resource dependence.[29]

Collier, Hoeffler and another member of their team, Ian Bannon, undertook statistical research specifically examining the effect of oil on conflict.[30] In developing countries where natural resource revenues account for more than 50% of gross domestic product (GDP), they determined the risk of secessionist war increases by approximately 38%. If a country has oil the risk increases to 100%. (SOURCE/PAGE) Collier’s (et-al) research has led him to conclude, “if oil is present a rebellion it is almost certain to be secessionist.”[31] The oil related conflicts noted by Collier (et-al) include: Aceh (Indonesia), Biafra (Nigeria), Cabinda (Angola), Katanga (ex-Congo) and West Papua (Indonesia). In these cases, greed and grievance are interconnected; state leaders are motivated to maintain control of oil and generally have not distributed wealth amongst their constituents. The lack of wealth sharing has given rise to grievance and rebel secessionist groups have emerged. The rebel groups, however, also become trapped in the greed cycle of conflict. Through extortion of companies exploiting oil and theft from illegally tapping into pipelines, the rebel groups often receive important financing for their guerrilla campaigns.[32] In this case both greed and grievance are literally fuelling conflict. The main weakness with Collier’s (et-al) research is that it focuses exclusively on violent intrastate wars and does not capture interstate or non-violent conflict dynamics in its economic modelling.

Beyond Greed and Grievance

A third school of study has emerged to examine the relationship between natural resources and conflict and the body of research is generally published under the rubric ‘beyond greed and grievance’.[33] Karen Ballentine and Jake Sherman have undertaken some of the most in-depth statistical analysis in this area. They argue there is a “Need to weigh economic factors vis-à-vis the role played by other political, cultural, and strategic factors in shaping the incidence, duration, and character of intrastate conflict.”[34]

Ballentine and Sherman developed seven hypotheses on resources and conflict – two of which are directly related to oil: “the more unlootable a resource is [i.e. Le Billon – point] the more likely it will lead to separatist conflicts; the more a resource is obstructable [i.e. Le Billon – distant] the more likely there is for an increase in the duration and intensity of conflicts.”[35] They study eight separatist conflicts, of which five have unlootable resources and two involve oil: Angola (Cabinda) and Sudan. They identified two oil related conflicts in which obstructability played a key role: Sudan and Columbia. They also researched financial flows and found that out of the eight cases, “revenues went exclusively to the government in four cases and to both sides [rebels/government] in four cases.”[36] In both Columbia and Sudan, the obstructable nature of their land-locked oil resources influenced conflict because both sides received revenues.[37] Regarding oil, one can draw the conclusion from Ballentine and Sherman’s research that where oil is abundant there is a higher likelihood of secessionist conflict. If obstructable (i.e. primarily in the ground in remote locations), oil has a high potential to be a source of both grievance and greed for secessionist groups.

Michael Klare is a well-known author on the subject of natural resources and conflict. His research and writing could arguably be classified as belonging to the ‘beyond greed and grievance’ school of thought. Klare’s work emphasizes the role of natural resource dependence, beyond the rigid understanding of scarcity, in shaping contemporary conflict, both inter and intrastate. Klare also studies grievance motivated conflicts, especially involving ‘lootable’[38] natural resources such as diamonds and timber. In his book Resource Wars, Klare outlines three factors he believes distinguish contemporary resource conflicts: “relentless expansion in worldwide demand, the emergence of significant resource shortages and the proliferation of ownership contests.”[39] Just as there is a paradox within the greed paradigm, whereby not just governments but secessionist leaders can become dependent on financing from oil, many of the oil conflict examples used by Klare point out the paradox of oil dependence; on the one hand it makes a nation’s economy strong, but on the other it leaves the nation vulnerable. Klare argues this dichotomy between strength and vulnerability greatly influences conflict around oil and will cause there to be more conflicts driven by dependence and scarcity in the future, rather than greed.[40]

While Homer-Dixon, Le Billon, Collier and Klare may not agree on many issues, there is one common characteristic of oil and conflict they do agree upon: the fact that the availability of oil does not in and of itself cause conflict but rather is part of a more complex set of variables that can predispose a state or region to conflict.[41] While there may be as wide a variety of opinions on the links between natural resources and conflict, most international relations specialists agree, “conflict over resources will remain a conspicuous feature of the international security environment.”[42]

Specific Examples of Oil Abundance Conflicts

In cross-referencing the research by Le Billon, Collier (et-al), Ballentine/Sherman and Klare, some common conflicts related to oil abundance emerge:[43]

  • Where oil resources are point or unlootable (i.e. offshore or close to urban centres) conflict is likely to take the form of challenge to state control through a coup d’etat: Algeria, Angola, Chad, Congo-Brazzaville, Iraq-Iran, and Iraq-Kuwait;
  • Where oil resources are distant or obstructable (i.e. inland and require transportation to ports via a pipeline network) conflict is likely to be secessionist in nature: Angola (Cabinda), Caucasus, Nigeria (Biafra), Sudan, and Columbia.

In addition to the above variables, the type of oil produced by a country can play a role in greed motivated conflict through the potential to obtain higher resource rents. Light, sweet crude oil of low sulphur content is the most valuable type of petroleum because it is most easily refined. Countries such as Nigeria and Angola have sweeter, lighter crude which might make them more prone to conflict that countries such as Venezuela or Saudi Arabia that tend to have heavier, sour oil.[44] In Nigeria, in particular, the high resource rents from its high quality oil have been considered an element in prolonging the violent conflict between rebel and government forces.