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Riding on the soaring petrol price, which now fluctuates around US$60 a barrel compared with US$28 in 2003, some oil producing countries have managed to reach a height of prosperity and are turning oil into a diplomatic weapon, which poses a challenge to the US hegemony, or "leadership," as some Americans put it.
Iran, Russia and Venezuela, whose petroleum deposits rank among the top seven in the world, are the most assertive in this regard.
Iran's oil foreign exchange income, for example, has doubled since 1998, when oil sold for US$10 per barrel on the international market. Supported by this, Iran is getting increasingly defiant and tough towards the United States and the European Union with regard to its nuclear programmes. Its negotiations with the EU reached deadlock recently, for example.
Iran, however, can safely stay free from worries about any real sanctions imposed by the EU, defiant as it is on the nuclear programme issue. This is because Western countries' heavy reliance on imported oil determines that they cannot get really tough.
Eighty per cent of France's annual oil consumption, for example, is imported, which is certain to sway France's attitude towards Iran.
Backed by this strong bargaining chip, the newly inaugurated Iranian President Mahmoud Admadinejad turned a deaf ear to the demand from the United States and EU that Iran give up its uranium enrichment programme and threatened to retaliate against India, which followed the Western countries in the vote on the matter at the International Atomic Energy Agency (IAEA).
Russia's oil output has been rising steadily over the past years and is, therefore, one of the biggest beneficiaries of the oil price hikes. As a result, the country is entertaining grand ambitions of replacing Saudi Arabia as the world's No 1 oil producing country in the not too distant future.
The image of a confident Russia as an important player on the world political and economic stages, backed by huge oil gains, is reflected by its demand for the United States to withdraw from some Central Asian countries, its refusal to pressure Iran to abandon nuclear programmes and its hard stance against Japan regarding the Siberia oil pipeline construction.
Venezuela offers another example.
Venezuela exports 1.5 million barrels of oil to the United States everyday, which make up 15 percent of the US daily oil imports. This makes Venezuela the United States' second largest oil supplier.
All this has created the pillars supporting President Hugo Chavez's tough US policy.
He was behind Caribbean countries' opposition to the US nominated candidate to head the Organization of American States, supported the Central American nations in their challenge to the US stance on a free trade zone and investment issues.
Venezuela, furthermore, openly supports Iran in its nuclear pursuit, being the only country at IAEA that voted against pressuring Iran to abandon its atomic programmes.
Moreover, Venezuela provides 53,000 tons of cheap crude oil to Cuba each day, which is the arch-enemy of the United States in the Western Hemisphere.
Other examples of Chavez's tough stance abound.
All the hard stances, deft manoeuvring and defiance are believed to be in the interest of the three countries in question.
But how much they impact the United States remains a question open for discussion, in my opinion.
Although the daily US oil consumption stands at 20 million barrels and 50 percent of its oil supply has to be imported, the United States, however, has managed to hedge potential oil supply risks by expanding the list of crude oil suppliers as much as possible, drawing bitter lessons from the oil embargo against it in the 1970s.
Canada, Venezuela, Nigeria, Mexico and Saudi Arabia are the top five crude oil providers, of which only Venezuela is one of the three "challengers" mentioned previously in this article.
Moreover, in the scenario of dropping or plummeting oil prices, the strategies of the "challenger" countries towards the United States are likely to be readjusted.
Dealing with high oil prices in the mid- and long-term rather than short-term is what weighs heavily on the minds of top US planners.
The US House of Representatives passed an energy bill earlier this year, authorizing the Energy Department to increase the country's strategic oil reserves from the current 700 million barrels to 1 billion barrels, offering US$18 billion worth of tax rebates to traditional energy companies and nuclear-power firms in the upcoming 10 years in order to encourage domestic oil production and reduce the heavy reliance on overseas oil supplies.
At the same time, US oil companies are encouraged to compete with their overseas peers on the international oil market. Besides oil, coal mining, nuclear power generation and other traditional forms of energy are emphasized.
All of this, in turn, will help minimize the influence of external factors in shaping the United States' foreign policies.
This also offers some useful lessons for us to learn.
(China Daily November 22, 2005)
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