Do countries fight over oil resources?


Emily Meierding writes: When China’s Haiyang Shiyou 981 oil rig sailed into waters off the Paracel Islands in May 2014, it provoked an international crisis. Hanoi insisted that the rig was operating illegally in Vietnamese territory. Both countries sent naval and fishing vessels to enforce their claims. Commentators predicted that the two states might come to blows.

The confrontation died down, but a critical question remains: Do countries fight over oil resources?

The question isn’t just pertinent to the South China Sea. The Arctic, Caspian, East China Sea and eastern Mediterranean have all been identified as potential “hot spots” for international oil conflicts. Numerous conflicts, including Iraq’s invasion of Kuwait, Japan’s invasion of the Dutch East Indies in World War II, Germany’s attacks against the Russian Caucasus in the same war, the Iran-Iraq War, the Chaco War between Bolivia and Paraguay, and even the Falklands War, have been described as international “oil wars.”

However, contrary to the conventional wisdom, the risk of international oil wars is slim. Although oil is an exceptionally valuable strategic and economic resource, fighting for it does not pay.

The belief that countries fight for oil rests on a flawed foundational assumption: Countries reap the same benefits from foreign oil resources as from domestic oil resources.

In reality, profiting from oil wars is hard.

Countries face at least four sets of obstacles that discourage them from fighting for oil: invasion costs, occupation costs, international costs and investment costs. [Continue reading…]

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