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®: CRE Regulatory Action of the Week

Syriana: Promoting the New Isolationism
CRE's Review of George Clooney's Movie

Syriana rightly focuses public attention on the critical role that oil has, and will continue to play, on US foreign policy and the well being of our citizens.

The simple fact is that US domestic reserves are insufficient. Saudi Arabia has nearly ten times our reserves, and the top ten oil producers have thirty times our reserves. America cannot conserve its way to energy security.

Syriana tries to deliver a progressive political message along with its substantial entertainment value. However, while the message the movie provides is political, it is not progressive. Instead, Syriana taps the one of the darkest paleoconservative beliefs, isolationism.

Although gussied up with a fast-moving plot, Syriana's basic contention is that America needs to go home and stay there. Instead of drilling in foreign lands, Syriana would have us sticking our collective head in the sand. Fortress America has never been and will never be a viable foreign policy option. In its quest for drama, the movie fails to recognize that oil companies' quest for foreign reserves improves the security and well being of US citizens.

Chinese companies are investing heavily in developing the substantial oil sands resources in Canada. The extracted oil would be sent by tanker to China, thus limiting deliveries to the U.S. Canada (not Saudi Arabia) is by far our largest, and our most stable, foreign supplier of oil. (The data source used for the pyramid chart estimates Canadian oil reserves based on an official estimate that includes Canadian oil sands "under active development." Oil and Gas Journal estimates that, including oil sands, Canada has 178.8 billion barrels of proven oil reserves, second only to Saudi Arabia.)

Recent news reports explain that China is selling supersonic fighter jets and fighter-bombers to Sudan, a country in which their state-controlled oil companies have significant stakes. Meanwhile, China's largest oil concern purchased a company that produces and refines petroleum in Kazakhstan. Another major Chinese oil company is looking at acquiring at least some of the assets of the former Russian oil giant Yuokos. However, any deal would require "the decision and coordination of the governments," according to the Chinese company's Chairman.

The rest of the world understands the need for their governments to take proactive measures to secure international petroleum resources and the means to effectively exploit them. America cannot pursue a go-it-alone energy strategy.

In addition to supporting prudent energy conservation, the U.S. government needs to use its leverage in the negotiation of treaties and trade agreements to seek oil drilling concessions for US oil companies.

Is this a new idea? Not really, twenty years ago the White House Office of Management and Budget instituted a similar plan for regulatory relief of US companies operating in foreign markets. That old idea provides a blueprint for how the U.S. can employ transparent and above-board mechanisms to help achieve energy security.

  • Click to see How We Can Improve US Energy Security