Lit Review: United States Foreign Policy — Energy Policy

With the understanding that Russian sanctions represent a real-world application of domestic IR theory under the realism paradigm, it was possible to begin to explore perspectives on U.S. foreign policy in the preceding period to the sanctions under analysis. Exploration in the present study was limited to perspectives on sanctions and energy policy.

Energy Policy

At the federal level, energy policy and foreign policy are generally implemented through separate executive agencies. Historically, energy has aligned with foreign policy to meet singular, specific national objectives, such as during the 1953 Iranian coup (Abrahamian, 2013) and in Nigeria during the run-up to the establishment of the United States Africa Command in 2007 (Jaffe, 2003; Klare, 2008). However, these alignments were ultimately always short-lived. The First Gulf War represented a turning point in U.S. energy policy as Washington convened an international coalition to protect the flow of petroleum from the Persian Gulf following Saddam Hussein’s invasion of Kuwait (Martin & Harrje, 2005). This multilateral intervention represented the first global initiative to use military force to protect the global energy sector, and following the September 11 attacks, the energy sector’s strategic importance only increased as the threat of unconventional attacks on global infrastructure became real.

Since the September 11 attacks, industry leaders and academics have advocated for a shift to a permanent convergence of U.S. energy and foreign policy goals. The two Kalicki & Goldwyn texts (2005b; 2013b) provided a broad overview of the geopolitical makeup of energy security in the twenty-first century through key industry leaders’ global perspectives that were designed to advocate for this convergence. The final chapter in the 2005 edition noted that Kalicki & Goldwyn were not advocating “for the energy tail to wag the foreign policy dog” but interjected that disregarding the sector’s economic and political implications cripples U.S. national security (2005a, p. 570). In this vein, Yergin (2005) advocated for the use of both military force and global criminal justice and intelligence networks to protect the energy sector, something he repeated a year later in a Foreign Affairs article (Yergin, 2006). This charge, though, is conspicuously missing from Yergin’s updated chapter in the 2013 edition of Kalicki & Goldwyn, which focused a large portion of its text on cyber security (Yergin, 2013). Fuerth (2005) went further than Yergin in calling for American intervention in the domestic affairs of suppliers in order to maintain supply stability, while Juckett & Foss (2005) recommended that the United States use its leverage to intervene in disputes between the energy sector and non-governmental organizations and/or governments concerning the development of new infrastructure in order to quickly resolve them to keep project costs low. This commentary on U.S. energy and foreign policy led to observers noting that the 2005 edition encouraged Washington to use its foreign policy to stifle unrest concerning energy production in order that markets benefit (Blake, 2014).

Under the Obama administration, the advocacy of the energy sector was realized by the convergence of energy and foreign policy. In October 2009, Secretary Clinton issued a diplomatic cable instructing diplomats to work to collect information on shale development in their respective regions from the host government, local geological research organizations, or the energy industry itself (Secretary of State, 2009). This cable was predated by Goldwyn himself, having been appointed by Secretary Clinton as the Coordinator for International Energy Affairs, organizing an industry seminar on “the potential international impact of shale gas” (Secretary of State, 2009, para. 4). Reports of positive opportunities were to be sent to the Office of International Energy and Commodity Policy under the Bureau of Economic and Business Affairs (Secretary of State, 2009). Blake (2014) noted that the efforts resulting from this cable led to the State Department’s Global Shale Gas Initiative, which was unveiled at a United States Energy Association meeting in April 2010. The next year, Secretary Clinton created the Bureau of Energy Resources, which was designed to integrate energy interests into the framework of the State Department and thus official U.S. foreign policy (Blake, 2014). The creation of this bureau was celebrated by Goldwyn & Kalicki in their 2013 edition, observing that Secretary Clinton had made energy “effectively a fourth pillar of U.S. foreign policy” (2013a, p. 563).

Central to the interests of the Bureau of Energy Resources was the development of unconventional natural gas reserves around the world, those of Eastern Europe in particular (Blake, 2014). The Eastern European market was of critical importance to the United States due to the Russian Federation’s historic market control, which Washington long held as contrary to its own interests (Heslin, 1997; Yergin & Stoppard, 2003; Emmott & Strupczewski, 2014; CNN, 2014; Bordoff & Houser, 2014; Krasuski, 2018; BBC, 2019). The U.S.-led development of Eastern European shale was marketed as a geopolitical tool for decreasing Russian influence in the region. This was blatantly exhibited in Poland, where Prime Minister Tusk described a Polish shale revolution as enabling the state to be the one “setting the terms” and gaining bargaining power with the Federation (Blake, 2014, p. 54; Baev, 2012), and in Ukraine, where Vice-President Biden invoked Ukrainian independence in the U.S. support of shale development by proposing a vision of a world in which Kyiv (or Kiev) had the agency to tell Moscow to “keep your gas” (Blake, 2014, p. 72). However, not all commentators agreed with the baseline argument that Russian natural gas needed to be diversified for national security reasons, arguing that the politicization was not beneficial to E.U.-Russian trade relations or the global natural gas market (Finon & Locatelli, 2008; Baev, 2012). Baev (2012) went a step further, identifying U.S. actors and, thereby, U.S. interests, as being behind the shift in European perspectives against the Federation and Russian energy, a claim that was corroborated in detail in Casier (2011).

At the same time, the domestic shale revolution in the United States was dramatically reshaping the marketplace of natural gas as the U.S. surged ahead of the Federation to become the world’s largest producer of natural gas. This supply boom boosted the prospects of U.S. LNG exports, which were posited as a means to decrease Russian influence in the European market (Bordoff & Houser, 2014; Morse, 2014). Stern & Rogers posited that U.S. LNG exports to the European market could be sufficient to force Russian natural gas away from its traditional role as a critical component of the supply system into that of a “shock absorber,” which would necessitate a strategic rethink of its market position due to the economic implications therein and would support the continued liberalization of the European energy market (2014, p. 38). Some commentators went further, suggesting that U.S. LNG exports would shift the market balance to the extent that Russian natural gas rents would decline sufficiently to dissuade and prevent Moscow from challenging Washington’s interests globally (Chanis, 2012). Others disagreed, arguing that decreasing natural gas rents, while burdening Russian firms, would not bear sufficient impact on the Federation’s overall state revenues, thereby eliminating any incentive to shift foreign policy activity (Bordoff & Houser, 2014). Bordoff & Houser (2014) also argued that the realistic impact of U.S. LNG exports were not sufficient to dramatically shift European reliance on Russian natural gas; however, it noted that the U.S. shale revolution had played a role in decreasing global natural gas prices overall, thereby strengthening Europe’s existing bargaining position vis-à-vis Moscow.

References:

Abrahamian, E. (2013). The coup: 1953, the CIA, and the roots of modern U.S.-Iranian relations. The New Press.

Baev, P. K. (2012). From European to Eurasian energy security: Russia needs and energy Perestroika. Journal of Eurasian Studies, 3(2), 177–184. https://doi.org/10.1016/j.euras.2012.03.008.

BBC. (2019, December 21). Nord Stream 2: Trump approves sanctions on Russia gas pipeline. https://www.bbc.com/news/world-europe-50875935.

Blake, M. (2014). The Chevron communiques. Mother Jones, (38)5, 51–54, 72. https://www.motherjones.com/politics/2014/09/hillary-clinton-fracking-shale-state-department-chevron/.

Bordoff, J., & Houser, T. (2014). American gas to the rescue? The impact of U.S. LNG exports on European security and Russian foreign policy. Center on Global Energy Policy. https://energypolicy.columbia.edu/sites/default/files/CGEP_American%20Gas%20to%20the%20Rescue%3F.pdf.

Casier, T. (2011). The rise of energy to the top of the EU-Russia agenda: From interdependence to dependence? Geopolitics, 16(3), 536–552. https://doi-org/10.1080/14650045.2011.520862.

Chanis, J. (2012). U.S. liquefied natural gas exports and America’s foreign policy. American Foreign Policy Interests, 34(6), 329–334. https://doi.org/10.1080/10803920.2012.742409

CNN. (2014, July 27). Fareed Zakaria GPS: Interview with Hillary Clinton. http://transcripts.cnn.com/TRANSCRIPTS/1407/27/fzgps.01.html.

Emmott, R., & Strupczewski, J. (2014, March 26). Obama tells E.U. to do more to cut reliance on Russian gas. Reuters. https://www.reuters.com/article/us-usa-eu-summit/obama-tells-eu-to-do-more-to-cut-reliance-on-russian-gas-idUSBREA2P0W220140326.

Finon, D., & Locatelli, C. (2008). Russian and European gas interdependence: Could contractual trade channel geopolitics? Energy Policy, 36(1), 423–442. https://doi.org/10.1016/j.enpol.2007.08.038.

Fuerth, L. (2005). Energy, homeland, and national security. In J. H. Kalicki & D. L. Goldwyn (Eds.), Energy & security: Strategies for a world in transition (pp. 411–424). Woodrow Wilson Center Press.

Heslin, S. N. (1997, November 10). The new pipeline politics. New York Times, 147(50972), A31. https://www.nytimes.com/1997/11/10/opinion/the-new-pipeline-politics.html.

Jaffe, G. (2003, June 10). In massive shift, U.S. is planning to cut size of military in Germany. Wall Street Journal (Eastern ed.), 241(112), A1. https://www.wsj.com/articles/SB105519171933119900.

Juckett, D. A., & Foss, M. M. (2005). Can a ‘global’ natural gas market be achieved? In J. H. Kalicki & D. L. Goldwyn (Eds.), Energy & security: Strategies for a world in transition (pp. 531–552). Woodrow Wilson Center Press.

Klare, M. T. (2008). Rising powers, shrinking planet: The new geopolitics of energy. Metropolitan Books.

Krasuski, K. (2018, January 27). U.S. says Russian gas link hurts European security. Bloomberg. https://www.bloomberg.com/news/articles/2018-01-27/u-s-says-russian-gas-link-to-germany-hurts-european-security.

Martin, W. F., & Harrje, E. M. (2005). The International Energy Agency. In J. H. Kalicki & D. L. Goldwyn (Eds.), Energy & security: Strategies for a world in transition (pp. 97–116). Woodrow Wilson Center Press.

Morse, E. L. (2014). Welcome to the revolution. Foreign Affairs, 93(3), 3–7.

Kalicki, J. H., & Goldwyn, D. L. (2005a). Conclusion: Energy, security, and foreign policy. In J. H. Kalicki & D. L. Goldwyn (Eds.), Energy & security: Strategies for a world in transition (pp. 561–578). Woodrow Wilson Center Press.

Kalicki, J. H., & Goldwyn, D. L. (Eds.) (2005b). Energy & security: Strategies for a world in transition. Woodrow Wilson Center Press.

Kalicki, J. H., & Goldwyn, D. L. (Eds.) (2013a). Conclusion: Energy, security, and foreign policy. In J. H. Kalicki & D. L. Goldwyn (Eds.), Energy & security: Strategies for a world in transition (2nd edition) [pp. 545–-581]. Woodrow Wilson Center Press.

Kalicki, J. H., & Goldwyn, D. L. (Eds.) (2013b). Energy & security: Strategies for a world in transition (2nd ed.). Woodrow Wilson Center Press.

Secretary of State. (2009, October 29). Assessing the potential for international shale gas development. WikiLeaks Cable: 09STATE111742_a. https://wikileaks.org/plusd/cables/09STATE111742_a.html.

Stern, J., & Rogers, H. V. (2014). The dynamics of a liberalised European gas market: Key determinants of hub prices, and roles and risks of major players. (OIES Paper: NG 94). Oxford Institute of Energy Studies. https://doi.org/10.26889/9781784670184.

Yergin, D. (2005). Energy security and markets. In J. H. Kalicki & D. L. Goldwyn (Eds.), Energy & security: Strategies for a world in transition (pp. 51–64). Woodrow Wilson Center Press.

Yergin, D. (2006, March/April). Ensuring energy security. Foreign Affairs, 85(2), 69–82. https://doi.org/10.2307/20031912.

Yergin, D. (2013). Energy security and markets. In J. H. Kalicki & D. L. Goldwyn (Eds.), Energy & security: Strategies for a world in transition (2nd ed.) [pp. 69–87]. Woodrow Wilson Center Press.

Yergin, D., & Stoppard, M. (2003). The next prize. Foreign Affairs, 82(6), 103–114. https://doi.org/10.2307/20033760.