The Arab Awakening and the Pending Oil Pinch
Jaffe, Amy Myers, Miller, Keily, Seton Hall Journal of Diplomacy and International Relations
When U.S. President Barack Obama addressed the Muslim world from Cairo in 2009, he made a point of specifying that America sought to improve its relations with the Middle East. He proposed engaging a wide range of issues including security, education, economic development, and human rights. The president said, "...while America in the past has focused on oil and gas in this part of the world, we now seek a broader engagement."1 His statements about democracy, justice, and the rule of law resonated most in the region. In reference to Iraq, Obama stated "no system of government can or should be imposed upon one nation by another." He went on to elaborate,
That does not ¿essen my commitment, however, to governments that reflect the will of the people...I do have an unyielding belief that all people yearn for certain things: the ability to speak your mind and have a say in how you are governed; confidence in the rule of kw and equal administration of justice; government that is transparent and doesn't steal from the people; the freedom to live as you choose. Those are not just American ideas, they are human rights, and that is why we will support them everywhere.2
In the immediate aftermath of the address, overall reaction to the speech was mixed. Arab commentators acknowledged the President's sincerity in wanting to improve U.S. relations with the region. As Abderrahim Foukara of the Al Jazeera network noted, the youth in Egypt and across the Arab world had presented the U.S. with the opportunity to ride the region's wave of "energy and enterprising spirit... despite all the bad vibes in the relationship..."3
The post-September 11 world provides numerous benefits for engaging the younger generation in the Middle East. Anti-Americanism can breed violent extremism that is clearly a danger to the U.S. and its regional allies. As the Arab Awakening now demonstrates, President Obama accurately described the desires of many young people across the Arab world. The political turmoil kindled by Mohamed Bouazizi's self-immolation stemmed from a deep frustration felt by the large population of young adults regarding high unemployment, a lack of personal freedom and human rights, corruption, a lack of government accountability, and dissatisfaction with the economy. These social and governance concerns plague the largest oil-producing nations of the Middle East. These issues may potentially threaten the oil supply that President Obama said would not be the primary focus of American foreign policy. As growing political and social demands among Persian Gulf populations begin to embody the values Obama espoused, the U.S. needs to reevaluate its energy policy and public diplomacy in the Arab world.
The Arab Awakening, though considered positive in some ways, might turn out to be adverse to America's oil interests. As the Arab Awakening swept across the Middle East in the spring of 201 1, the impact on oil prices was almost instantaneous. The sudden outbreak of large-scale anti-government protests in Egypt was the first event to rock global oil markets, as spot oil prices increased nearly 5 percent in a matter of days due to fears that oil traffic through Egypt's Suez ^. would be G ^ (TM)e announcement that Iran was sending naval snips through the Suez Canal pushed UK Brent prices even higher, to more than $104 per barrel.5 While the Canal was never closed, pending oil exploration deals were put on hold. Egyptian natural gas operations were disrupted by an explosion at the Arab Gas Pipeline, which led to a month-long suspension of natural gas exports to Jordan, Syria, Lebanon, and Israel.6 No sooner had the market adjusted to the news from Egypt when civil war in Libya forced the evacuation of foreign oil operators, reducing Libya's oil output of 1.65 million barrels per day (b/d) by up to 75 percent.7 Meanwhile, European sanctions on Syria have also reduced Syrian oil exports from 130,000 b/d to almost zero.8 In Yemen, political volatility has resulted in frequent disruptions in oil output and pipeline capacity since July 2011, and a worsening of hostilities could impact output even further. …