The Oil Curse

In 1900, Oil was discovered in Texas, USA, and the Hamill brothers orchestrated the drilling of the wells. The Hamills used a steam engine to drill the well. At 11000, they reached the oil reservoirs. Initially, the oil reservoirs were projected to produce 50 gallons a day but surpassed to 80,000 gallons, making the USA the largest oil producer in the world. This reflection paper seeks to discuss how the discovery of oil in Texas enhanced the economic growth in the country.

At the dawn of the twentieth century America’s future looked bright, Industrialization in addition to transforming America had brought with it advances in medicine, science, and technology. Production of everything from food to pharmaceuticals grew at an unprecedented rate throughout the twentieth century. Through the use of fossil fuels the developed world, especially that of the United States was able to sustain larger economies, populations, food surpluses and money surpluses. However when world production of oil peaked in 2005 (Ruppert), meaning the end of cheap, abundant crude oil that had fueled everything for so long. Thus began the recession of 2008, and through our politicians claim it ended in 2009 it remains clear that whenever the economy begins to gain momentum, the increase in fuel use retards its growth, all because the price of oil control our national and global economies. All the while we as Americans continue to live in our oil fantasy thinking the end of cheap oil will never happen and that there shall always be oil.

Venezuela’s reputation has been well established regarding its supply of oil and how it was being used for medicinal use and other purposes. It was not until the first oil well was drilled in 1912, when Venezuela became the world’s second largest oil producer behind the US, and the world’s largest oil exporter (Wilpert, 2003). With the well drill in the country it attracted many major oil producers that wanted a piece of anything they could get. The Royal Dutch Shell and Rockefeller’s Standard Oil became the main producers of the oil and maintained a high status. Everything was going great for the company, “ between 1920 and 1935 oil share’s exports went up from 1.9% to 91.2%”(Wilpert, 2003), but not everything goes according to plan. The country had a dramatic impact towards its economy that many recall, “The Dutch Disease.” “The utmost important magnitude of the Dutch Disease was that agricultural production declined to almost nothing and the country fell behind in industrializing, relative to other Latin American countries” (Wilpert, 2003). Thus, Venezuela had passed a reform oil policy that was the Hydrocarbons Act, which was from the oil revenues based on the income of the mines (Wilpert, 2003), bringing the state’s income to stability.

There are many arguments for and against the United States major reliance in foreign oil. Over the years with the vast improvements and technological advances in the petroleum industry, the United States has been able to become increasingly self-sufficient, drastically decreasing its reliance on the import on foreign oil. In Michael Klare’s Book, Blood and Oil: The Dangers and Consequences of Americas Growing Dependency on Imported Oils (2004) he states that,

America the beautiful, land of the greed and the home of oil. Along with being a major superpower comes an insurmountable thirst for fossil fuels. Imperialist ideals and the corporate oil empire can bring stability and jobs but heavy costs also arise. Numerous solutions have been tried, but without fixing the underlying problem more issues are inevitable. Our over-consumption has an incredible effect on our reliance on foreign oil. OPEC, the Organization of the Oil Producing Countries, has supplied Americans with a constant flow of both oil and jobs. Nevertheless, progression comes with high cost to our environment, in addition to pulling us into international involvements. Increasing the United States’ domestic oil production was just a

The book, Crude World: The Violent Twilight of Oil is a warning to the world about the great harms that have been imposed on people and the earth by our need and dependence on petroleum products. The story is much darker than most people know and Maass is hoping to change that.

Nine months after the last pullout of U.S troops, Iraq’s oil production has been growing so rapidly that world markets are now looking to Baghdad to play a major role in keeping global oil flowing and moderating prices in the years ahead. Even though the International Energy Agency (The IEA) does believe that Iraq has the potential to boost the global oil supply in coming years, they also have concerns over whether Iraq is stable enough for the task. The article entitled “Iraq Oil Production Poised to Lead World Oil Supply Growth, but Obstacles Loom,” by Thomas K. Grose is about how Iraq has the capability to lead Earth’s oil productions, but it also takes into consideration the challenges that Iraq faces as a country. The following is a report over the two parts of the title of Thomas’s Article.

Nigeria has not flourished the ability to manufacture direct products in its own country. Instead, imports, 85% of its national demands and is a customer to many developed countries who gain greater profit from Nigeria's inability. Western countries like France forged deep ties with governments rich in major oil, gas and mining companies, strategically allowing themselves to secure exploration and production rights in exchange for royalty payment (Frank Vogl, 2012). These strategies have always resulted in a greater profit for

Thus most industrial nations wanted to change their dependency upon oil, which sparked many efforts in oil conservation, restrictions, and research into alternative energy resources. This issue has caused many problems in international relations there and even today it is the root of political skirmishes. Many countries believed that the oil companies should be broken up so that there would not be any monopoly in this giant industry. This time of exploration was iconic because of the pressure in the oil industry. Also, there was a prediction during this time that made a close connection between economic health and the control of oil resources.

This ties in with some recent reports that Kazakhstan has one of the fastest growing economies in the world (Robinson, 2015). Hugely because of the oil reserves found in the country, Kazakhstan has benefited from averaging 8% growth rates since 2000 for their GDP and has given significant rise to the per capita income (International Monetary Fund, 2013, p. 3). These large oil reserves have given many countries great interest in the country and continue to provide money to this region to help ensure their own interests are secure in regards to providing oil for their own

The documents added that "the involvement of foreign companies seems to be the only possible solution" to make Iraq a reliable exporter of oil. This, however, would be "politically sensitive" and "would require careful manipulation to avoid the impression that we are trying to lead the Iraqis in a particular way."

The first section sets the foundation for Roberts’ discussion by discussing the current environment surrounding the oil business. According to Roberts, energy is related to flourishing and decline of the human race. Only when a community has the ability to provide enough energy to meet the demand of the population can that community thrive (Roberts 2004). Roberts argues this correlation explains how and why the international community has become dependent on oil. The second section discusses the present situation and introduces what Roberts calls the energy order, which is a term that describes a social hierarchical ranking of countries based off of their energy consumption, their ability to produce or access to oil. The third and final part combines the discussion of parts one and two in relation to the future. Roberts argues that the current model with currently have is not working and offers a discussion on transitioning to a new model with less demand for oil. In order for this to occur, the United States, which consumes the most energy annually and has enough political and economic influence, must lead the way (Roberts

The countries that are rich in oil now face the problems offluctuating prices as well as depleting their reserves, so maybe one day the oil poor countries’standards of living will surpass the oil dependent countries in Southwest Asia and North

The oil-rich Bolivarian Republic of Venezuela, located on the northern coast of South America, was for many decades considered among the wealthiest nations in the entire continent. While having the largest proven oil reserves in the world has often proved a tremendous boon for Venezuela, the very black gold that has been the cause of its success has also proven to repeatedly be its kryptonite. Over half of the nation’s Gross Domestic Product stems from petroleum exports – which equates to approximately 95% of total exports. It is really not too hard to imagine what drastic consequences shifts in global oil prices could have on the economy.

The Chad Cameroon Petroleum Development and Pipeline Project is one of the largest investments in the private sector in Africa that costs approximately US$3.7 billion. The project is being funded by the World Bank and the International Financial Corporation. The involvement of these two major financial institutions is a demonstration of the rationale that the project will generate revenue that will enable the Chad and Cameroonian governments to invest more in programs that focus on reducing poverty like rural employment, education, and health. The involvement of the International Financial Corporation will be geared towards accomplishing three major roles. These are long-term financing, stabilizing role, and uplifting the quality and standard of mitigation plans and environmental assessments.