The Age of Oil: The Mythology, History, and Future of the World's Most Controversial Resource

362 Pages·2006·1.61 MB·English

by  Leonardo Maugeri

THE AGE OF OIL
The Mythology, History,
and Future of the World’s Most
Controversial Resource
LEONARDO MAUGERI
Libraryof Congress Cataloging-in-PublicationData
Maugeri, Leonardo,1964–
Theage ofoil: themythology,history, and futureof theworld’s most
controversial resource/Leonardo Maugeri.
p. cm.
Includesbibliographical referencesand index.
ISBN0–275–99008–7(alk. paper)
1. Petroleum—History—19th century. 2. Petroleum—History—20th
century. 3. Petroleum—History—21st century. 4. Petroleum industryand
trade—History—19thcentury. 5. Petroleum industry andtrade—History—20th
century. 6. Petroleum industry andtrade—History—21st century.
7. Petroleum reserves. I. Title.
TN870.M339 2006
553.2'82—dc22 2006006632
BritishLibrary Cataloguingin PublicationDataisavailable.
Copyright#2006byLeonardo Maugeri
Allrightsreserved. No portionof thisbookmaybe
reproduced, byanyprocess ortechnique, withoutthe
expresswritten consent ofthe publisher.
Libraryof Congress CatalogCard Number:2006006632
ISBN: 0–275–99008–7
Firstpublished in2006
PraegerPublishers, 88 PostRoadWest,Westport, CT06881
Animprint of GreenwoodPublishing Group, Inc.
www.praeger.com
Printedin theUnited States of America
Thepaperusedin thisbookcomplieswith the
PermanentPaper Standardissued bytheNational
InformationStandardsOrganization (Z39.48–1984).
10 9 8 7 6 5 4 3 2 1
To Enzo Viscusi,
whomorethananyoneelseaccompaniedmeonmyjourneythrough
the oil industry and the complexities of international affairs.
His unstinting generosity and wholehearted friendship
have made this book possible.

List of Abbreviations
Contents
Note by the Author ix
Preface xi
List of Abbreviations xix
PART ONE
A History of an Unreliable Market
(and the Bad Policies It Prompted)
1 John D. Rockefeller’s Cursed Legacy 3
2 The Age of Gasoline and Oil Imperialism 19
3 The Carve-up of Arabia’s Oil 33
4 The Oil Glut of the 1930s 41
5 Cold War Fears and the U.S.-Arabian Link 51
6 The Iran Tragedy and the ‘‘Seven Sisters’’ Cartel 63
7 The Golden Age of Oil and Its Limits 77
8 Oil and the Explosion of Arab Nationalism 93
9 The First Oil Shock 103
10 The Second Oil Shock 121
11 The Countershock 133
12 A Storm in the Desert: The First Gulf Crisis 145
viii Contents
13 The Soviet Implosion and the Troubled Caspian El Dorado 155
14 The Collapse of Oil Prices and Industry Megamergers 169
15 The First Oil Crisis of the Twenty-first Century 183
PART TWO
Misperceptions and Problems Ahead
16 Are We Running Out of Oil? 201
17 The Inner Secrets of Oil 207
18 The Puzzle of Oil Reserves and Production, and the
Quest for Their Control 219
19 The Problems with Oil Quality, Price,
and Consumption Trends 233
20 Flawed Forecasts, Foggy Alternatives to Oil 247
21 Arabs, Islam, and the Myth of Oil Security 259
Appendixes
1 Proven Reserves, Production, and Reserves Life
Index of the First Twenty Oil Countries in the World
and World Totals (2004) 273
2 Consumption Trends of the First Twenty Countries
in the World (1980–2004) 274
3 Main Features of Some Qualities of Crude Oil 275
4 The Largest National Oil Companies 277
5 The Largest International Oil Companies 278
Notes 279
Bibliography 311
Index 323
Contents
Note by the Author
In order to help the reader, I resorted to some simplifications. In
dealing with the history of oil companies, I used their current names
instead of the original ones they held for part of their existence. So, for
instance, the reader will find BP instead of Anglo-Persian Oil Company
and—later—Anglo-Iranian Oil Company; Chevron instead of Standard
Oil Company of California; Exxon instead of Standard Oil of New
Jersey; Mobil instead of Standard Oil New York-Vacuum Oil; Total
ratherthanCompagnieFranc¸aiseduPe´trole.Althoughsomemayargue
against this choice, I think it will allow the reader to avoid being con-
fused by too many names and too many confusing changes that add no
value to the tale.
Astothetransliterationofforeignnamesandwords(Arabic,Iranian,
Russian, etc.) I simply made the choice to use the forms prevailing in
current American usage, avoiding those phonetic symbols that—in my
opinion—have no sense in the American language.
Personally,Idislikeabbreviations.However,Imustadmitthatitisquite
boringtoconstantlyrepeat‘‘millionbarrelsperday’’insteadofasimple
‘‘mbd,’’ or ‘‘Organization of Petroleum Exporting Countries’’ in place
ofitsOPECacronym.SoIabdicatedtosomeessentialabbreviations.