Picture this: In a world where oil isn't just a fuel but a powerful puppet master pulling the strings of international conflicts, economic turmoil, and shifting alliances – that's the stark reality unfolding in 2025. As Russia's invasion of Ukraine reshapes global energy landscapes and OPEC+ throws curveballs with production cuts, we're witnessing a dramatic overhaul of oil geopolitics that could redefine power dynamics for years to come. But here's where it gets controversial: Is this shift toward 'energy security' just a polite way of saying 'every nation for itself,' leaving vulnerable economies in the dust? Stick around, because this is the part most people miss – how everyday decisions at the gas pump ripple into global tensions.
Welcome to a captivating discussion from the Council on Foreign Relations' Winter/Spring 2023 Academic Webinar Series. I'm Irina Faskianos, the Vice President of National Program and Outreach at CFR, kicking off this on-the-record session. The full video and transcript are readily available on our website at CFR.org/Academic, so feel free to pass them along to your colleagues or students. As always, CFR doesn't take institutional stances on policy matters – we're all about fostering informed conversations.
We're thrilled to host Carolyn Kissane today, diving into the fascinating world of oil geopolitics. Dr. Kissane, an academic director and clinical professor at NYU's Center for Global Affairs, also leads their graduate programs in global affairs and global security, including cybercrime. She's the director of the Energy, Climate Justice, and Sustainability Lab at NYU's School of Professional Studies. With accolades like being named one of the top ten New York women in energy and a leading energy communicator by Breaking Energy back in 2013, she's a member of CFR and the National Committee on U.S.-China Relations, plus she sits on several boards. Carolyn, we're so grateful for your time – let's dive right in.
To set the stage, I asked Carolyn how oil geopolitics has evolved, particularly in light of Russia's invasion of Ukraine and OPEC+'s recent oil production reductions. And wow, did she deliver some eye-opening insights. Over the past 14 months, she explained, Russia's actions have fundamentally altered the oil map. As a major producer – ranking among the world's top three – Russia's moves have prompted a reevaluation of energy security worldwide. Countries are now grappling with broader questions about how to safeguard their energy supplies, all while navigating the ongoing energy transition and the urgent need to cut carbon emissions to combat climate change.
This period has catapulted energy security to the forefront of global conversations. But wait, here's where it gets intriguing: Despite all this talk of transition, demand for oil isn't shrinking – it's expanding, especially from Asia. China's reopening after lockdowns adds layers of uncertainty to future demand projections. Carolyn shared data points that bring this to life, emphasizing how deeply interconnected our global energy systems are. No nation is truly self-sufficient in oil; some are rich in reserves, others must import, but every country relies on it for critical national security reasons.
Let's talk numbers to make this tangible for beginners: Every single day, the planet consumes a staggering 100 million barrels of oil – and that's before any reductions. This oil travels through a vast network of pipelines and tankers, highlighting our shared vulnerability. Surprisingly, we're not seeing a drop in demand; instead, it's growing. Carolyn pointed out that while COVID-19 caused temporary dips (far less than expected), the world has bounced back stronger than ever. With forecasts predicting continued increases through 2024, and questions lingering about 'peak demand' – some experts say before 2030, others later – the interplay between production and consumption feels more critical than ever.
Adding fuel to the fire, OPEC+'s recent decision to slash production by 1.2 million barrels per day sent oil prices soaring to over $80 a barrel. This move, Carolyn noted, wasn't just economic; it was a surprise amid tight global supplies, directly impacting U.S. gas prices and broader economic stability for nations already teetering on recession. And this is the part that sparks debate: Is OPEC+ prioritizing member interests over global needs, potentially exacerbating inflation and energy poverty? She invited us to ponder how this affects vulnerable economies, where higher prices could mean lights going out or industries grinding to a halt.
Carolyn walked us through key visuals to illustrate these dynamics. OPEC, historically the big player, now shares the stage with OPEC+ – including Russia, Kazakhstan, and Mexico – with Saudi Arabia as the undisputed leader, pumping 10-11 million barrels daily. Venezuela boasts the world's largest reserves but operates far below capacity. On the consumption side, the U.S. leads, but China is the top importer, with India also surging. Russia, surprisingly, continues exporting oil – often at discounts to nations like Turkey, Singapore, China, and India – bypassing sanctions through creative means like shadow fleets and alternative routes. This reshaping of markets raises provocative questions: Are these 'discounted' deals fair play, or do they undermine global efforts to isolate Russia economically?
She highlighted the role of state-owned giants like Saudi Aramco and Venezuela's PDVSA, which control over 75% of global oil, versus international players like ExxonMobil and Chevron. Pipelines and tankers – think 2,381 operational ones worldwide – underscore our interconnectedness. And yet, with state budgets and geopolitics intertwined, decisions like OPEC's cut stem from revenue needs, not just supply logic. But here's the controversy most overlook: As we push for decarbonization, how do we balance this with the reality that oil remains indispensable for fertilizers, petrochemicals, and transportation? Carolyn challenged us to think about emissions – some producers market 'low-emission' oil, but is that greenwashing, or a genuine step forward?
The Q&A session was a goldmine of insights. Morton Holbrook from some institution kicked things off by questioning if the Paris Agreement, signed in 2015, is just a relic in the face of relentless oil consumption. Carolyn agreed it's a puzzle: Projections vary on when demand peaks, with BP seeing it before 2030 and others later. Oil's ubiquity in sectors beyond cars – like petrochemicals – complicates the shift. During COVID, demand fell modestly, but rebounds like China's post-lockdown boom show we're far from weaning off. She drew attention to producers integrating carbon capture to cut emissions, sparking debate: Can we trust claims of 'cleaner' oil, or is this a distraction from deeper reductions?
Next, Jovana Vujanic from Lewis University probed how Saudi Arabia's cut strains U.S.-Saudi ties. Carolyn described a decade of simmering tensions, worsened by Saudi Arabia's non-alignment on Ukraine and its deepening ties with Russia and Iran – brokered by China in a stunning diplomatic win. The U.S. tapped its Strategic Petroleum Reserve (SPR) at record levels in 2022 to cushion inflation, but relations are fraying. And this is where it gets provocative: Is Saudi Arabia pivoting toward a multipolar world, leaving the U.S. scrambling? Carolyn hinted at a 'new relationship' brewing, one that could redefine Middle Eastern alliances.
From a class in Saudi Arabia, Curran Flyn's student Nasser al-Nasir asked about Russia's alternative routes, like the East Siberian Pipeline to China, and their impact on U.S. markets and the SPR. Carolyn explained how Russia reroutes oil east, dodging sanctions via shadow tankers and funds like RDIF. This boosts China's refining capacity and India's emergence as an Asian refining hub, but at what cost? She warned of potential SPR draws if supplies tighten further, urging judicious use – we're down to 700,000 barrels. Controversially, does this 'workaround' strategy legitimize Russia's war by funding it, or is it savvy survival in a sanctions-ridden world?
Michael Trevett from the University of Southern Mississippi inquired about South China Sea reserves. Carolyn noted China's existing production but declining output, with shale challenges limiting replication of the U.S. shale boom. Territorial disputes complicate extraction, making it unlikely soon – a reminder of how geopolitics trumps geology.
Rob Warren from the Anglo-American University explored Venezuela's future role. With massive reserves but outdated infrastructure and sanctions (save for Chevron's exemption), reintegration hinges on political shifts. Its heavy oil's high emissions pose hurdles in a low-carbon era. Carolyn mused: Could Venezuela rebound, or is its potential forever stymied by 'above-ground risks' like corruption and neglect?
Clemente Abrokwaa from Penn State highlighted Africa's electric vehicle transition challenges. Carolyn pointed out oil producers like Nigeria face investment droughts from Western banks shunning fossil fuels, despite Africa's energy access gaps. This raises fiery questions: Is it hypocritical for the West to block African development while funding elsewhere? She advocated for a 'whole-of-energy' approach, ensuring Africa gets affordable, reliable energy without derailing global decarbonization.
Kyle Bales from Lewis University asked about the Ukraine war's effect on Europe's Green Deal. Carolyn defined it as a $250 billion push for renewables, accelerated by Russia's gas weaponization. Yet, internal EU debates – like France vs. Germany on nuclear vs. gas – show uneven progress. Provocatively, is this a 'race' for clean tech, or a competitive scramble that could widen global divides?
Dr. Laeed Zaghlami from the University of Algiers discussed Nigerian pipeline projects to Europe via Algeria or Morocco. Carolyn assessed their feasibility: One underway, the other distant by 2047. Algeria's rising gas exports to Europe exemplify diversification, but pipelines demand cross-border trust. This begs: In a fractured world, can infrastructure projects unite or divide?
Vincent Brooks from Harvard and Diamondback Energy examined India's and China's discounted Russian oil purchases. Carolyn detailed how both build refining capacity, using oil for domestic needs, stockpiles, and even re-exports, profiting in the process. Shadow trading hubs in places like Malaysia highlight evasion tactics. Here's the real debate: Are buyers like India and China opportunists exploiting discounts, or essential players stabilizing global markets? Implications ripple to Africa, where refined products might fuel profits or poverty.
Finally, Bhakti Mirchandani from Columbia University pondered nuclear's global path, noting Ukraine's impact on refining and nuclear's decarbonization potential. Carolyn outlined divergent paths: China and Saudi Arabia expand, while Germany resists. France and Sweden pivot to more nuclear for security and net-zero goals. The U.S. struggles with costs and public fears. Thought-provokingly: In a net-zero world, is nuclear inevitable, or a relic of outdated energy paradigms?
Christian Bonfili from Torcuato di Tella University wondered if Ukraine's fallout speeds Europe's green shift. Carolyn affirmed yes, via renewables, hydrogen, and LNG diversification – yet Russia still supplies some LNG. It's accelerating, but cautiously. And this is the part most people miss: True security means blending old and new, not abandoning one for the other.
Wrapping up, I posed a big-picture question: Carolyn's top three challenges for oil geopolitics in the next 5-10 years. First, strained U.S.-Saudi ties amid a U.S.-China cold war. Second, tightening supplies against rising demand, threatening fragile economies. Third, ensuring resilience without prematurely depleting resources. She urged vigilance: As complexities grow, we must build systems that keep the lights on and economies humming.
Carolyn Kissane, thank you for this enlightening chat – follow her @carolynkissane. Stay tuned for our fall webinar lineup via the CFR Academic Bulletin; subscribe at academic@cfr.org. Explore CFR.org, ForeignAffairs.com, and ThinkGlobalHealth.org for more. And remember our paid internships and professor fellowships at CFR.org/careers, or @CFR_Academic.
What do you think? Does OPEC+'s decision signal a fair economic strategy or a geopolitical power grab? Should we embrace nuclear for cleaner energy, or is it too risky? Share your takes in the comments – agree, disagree, or add your spin. Let's keep the conversation going!
