Fuel for thought

Seizing Power: The Grab for Global Oil Wealth

By Robert Slater John Wiley & Sons, 2010 US$29.95

The subject of oil brings out a lot of nuts eager to discuss conspiracy theories about the motivations of war, oil’s devastating impact on the environment or its price – and frequently a combination of these.

Mentions of China’s forays into Africa in search of the black gold are a common feature of these discussions – often followed by disparaging remarks about Beijing’s willingness to support dictatorships, genocides or some other undefined but definitely unwanted evil.

Robert Slater’s Seizing Power: The Grab for Global Oil Wealth is, luckily, none of the above.

Unluckily, Seizing Power is better defined by what it isn’t than by what it is. It is definitely not a seminal work in the league of The Prize: The Epic Quest for Oil, Money and Power, the heavy but highly readable tome that won Daniel Yergin a Pulitzer in the 1990s. Nor is it as clear and concise explanation of the mechanics of oil that Vaclav Smil provides in his simply titled Oil.

Weak analysis

Slater’s book does not provide any serious discussion on geopolitics, economics or the environment. It does not include much more than superficial analysis on a wide range of related areas. It discusses China at some length, but with little more than cursory detail. It is a simplistic book with little new information and even less analysis of where the oil industry is, or where big players like China are going.

Seizing Power is a reasonably straightforward account of how oil companies have grown and changed and how some of the biggest oil producers have developed.

It is a concise briefing of what American newspapers and magazines have reported in the last decade, with a few additional reports and interviews thrown in. As a briefing it works reasonably well, albeit from a US-centric perspective.

Slater describes the contrast between private big oil and the emergence in the last couple of decades of national oil companies.

In China, China National Offshore Oil Corp (parent of CNOOC; CEO.NYSE, 0883.HK), China National Petroleum Corp and China Petroleum and Chemical Corp (PTR.NYSE, 600028.SH, 0386.HK) emerged as the big players and, writes Slater, the spearhead in the country’s efforts to secure oil resources around the world.

Discussing China in the context of the country’s efforts to secure natural resources around the world, and the impact of those efforts on consumption patterns and the balance of global power, Slater appears to be a little out of his element. He falls into many of the same traps that snare most foreign observers, including a tendency to oversimplify and make China, its oil companies and government into a monolithic structure, and one with inherently cynical motives.

There is an accompanying assumption that Western countries have no similar motives; the contrast in this belief surfaces in Slater’s wording with invariably negative connotations. Whereas Western oil companies "invest" in oil resources "the Chinese invaded Africa, not with guns, but with money and influence."

It’s an odd assumption given his early description of what happened when S?o Tomé and Principe discovered oil: It quickly piqued the interest of Western companies and governments keen to build up infrastructure and even a US naval base. At one point, the US sent a military attaché to the small island nation where the military budget was US$1 million and the army did not have a single battle-ready soldier. Slater avoids the obvious question of who invaded whom.

Seizing Power tries to cover too much and, in doing so, raises more questions than it has answers for. It jumps around from the creation of the "seven sisters," the first oil companies, to the evolution of petroaggressors – nations that become more assertive after discovering oil – to China’s efforts in India and the evolution of the oil economy in the Middle East. It touches on the history of oil production and how it has driven life in the US, and tackles the uncertain and touchy subject of peak oil – the moment after which oil production begins to decline. It even discusses alternatives to oil and the role of emerging consumer markets like China.

Seizing Power is a book about the role of oil in today’s world. Unfortunately, it is all well-trodden territory and Slater does not deviate from any long-standing assumptions.

Alfred Romann