Will the recent US Treasury sanctions and impending Congress sanctions on Iran influence Indian companies from doing business with the Islamic Republic?
India is being subjected to increasing pressure from the developed countries to cut down on its carbon emissions on the grounds that it is the fifth largest consumer of energy. This comes even as there are forecasts that India's energy consumption will increase incrementally as it tries to address the challenges of its social and development goals by increasing and sustaining economic growth at around 8–10 per cent of its GDP.
Though global warming and climate change is a real concern and needs to be addressed, it is concerns over energy security that are driving the West's policy and debate on climate change. With the traditional oil and gas market changing in favour of the developing countries, the developed countries are concerned about retaining their preferential access to energy resources.
The ramifications of an end to dollar-based oil trade would extend far beyond the oil market and would herald the beginning of a new international political order.
As the saying goes, everything that goes up had to come down. The same holds true for the price of oil, which has seen a slide of around 55% in just three months. At one point of time there were even predictions that prices would reach $200 a barrel. However, currently, the price of oil has dropped to $68 a barrel, from a high of over $147 in July this year. But the question is how and more importantly, why did this happen, and in such a short time.
The Russia-Georgia conflict has caused several analysts to state that Moscow’s main goal was to ensure its energy dominance in the region. Though this may not be entirely correct – other Russian security interests were equally at play – energy issues did have a large role. Ever since Vladimir Putin took over the reins, he had time and again reiterated the importance of energy in Russia’s regional, and indeed its global, policy. It is well known that Moscow will not allow its supremacy to be compromised. Putin’s successor Dmitry Medvedev appears to be continuing with his mentor’s policy.
With the price of oil crossing $110 a barrel, the oil-importing countries' concerns have been mounting. Not surprisingly, the issue of whether the time is now ripe for energy consuming countries to take measures to counter the producers' growing clout is being discussed, including the formation of a consumers' cartel, to force exporters to bring down prices.
The beginning of the end of the dollar era?
The ramifications of an end to dollar-based oil trade would extend far beyond the oil market and would herald the beginning of a new international political order.