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The top 72 uses for oil every day

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Whether as a fuel or a feedstock: oil is an integral part of your daily life.

According to the International Energy Agency (IEA), it's likely to remain so for decades to come, even as the world embarks on a low carbon pathway to help meet climate change commitments. The IEA expects demand for oil to grow to 103.5 million barrels of oil per day (mb/d) in 2040, compared to 92.5 mb/d in 2015 - an increase of 11%.

This infographic highlights 72 uses for oil in everyday life and is available in multiple languages:
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Although the major use of petroleum is for fuel, and petroleum and natural gas are often employed to generate electricity, there are many other uses. This interactive infographic showcases the many uses of oil and gas in our daily lives.

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Whether as a fuel or a feedstock: oil is an integral part of your daily life.

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This war was fought for controlling a massive oil supply in south america

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Chaco War

Part of the interwar period

Map of the Chaco War, showing important forts, military outposts, cities, and the Paraguayan advance to the west

Date

9 September 1932 - 12 June 1935
(2 years, 9 months and 3 days)

Location

Result

Paraguayan victory[6]

Territorial
changes

Most of the disputed area awarded to Paraguay

Belligerents

Paraguay
Supported by:

Bolivia
Supported by:

Commanders and leaders

Strength

150,000[7]

210,000[7]

Casualties and losses

50,000-80,000 killed

40,000 wounded

21,000 captured[11][12][10]

70,000 civilians killed[13]

The Chaco War (Spanish: Guerra del Chaco, Guarani: Cháko Ñorairõ) was fought from 1932 to 1935 between Bolivia and Paraguay, over the control of the northern part of the Gran Chaco region (known in Spanish as Chaco Boreal) of South America, which was thought to be rich in oil. The war is also referred to as La Guerra de la Sed (Spanish for "The War of Thirst") in literary circles since it was fought in the semi-arid Chaco. The bloodiest interstate military conflict fought in South America in the 20th century, it was fought between two of its poorest countries, both of which had lost territory to neighbours in 19th-century wars.

During the war, both landlocked countries faced difficulties shipping arms and supplies through neighbouring countries. Bolivia, in particular, faced external trade problems and poor internal communications. Although Bolivia had lucrative mining income and a larger and better-equipped army, a series of factors turned the tide against it, and Paraguay controlled most of the disputed zone when the war had ended.

The peace treaties ultimately granted two-thirds of the disputed territories to Paraguay.

Paraguayan (1924, 1927 and 1932) and Bolivian (1928) stamps. The 1924 Paraguayan stamp shows no border with Bolivia. In 1927, the border is shown to run to the north from Gran Chaco. In 1932, it had moved even farther north with the disputed territory called Paraguayan Chaco; with slogan saying "was, is and will be [ours]". The Bolivian stamp labels the region as the Bolivian Chaco.

The origins of the war are commonly attributed to a long-standing territorial dispute and to the discovery of oil deposits on the eastern Andes range; in 1929, the Treaty of Lima ended the hopes of the Bolivian government of recovering a land corridor to the Pacific Ocean, which was thought imperative to further development and trade.

Both Bolivia and Paraguay were landlocked. The 600,000 km ² Chaco was sparsely populated, but control of the Paraguay River running through it would provide access to the Atlantic Ocean. That became especially important to Bolivia, which had lost its Pacific coast to Chile during the 1879 War of the Pacific. Paraguay had lost almost half of its territory to Brazil and Argentina in the Paraguayan War of 1864 to 1870 and was not prepared to surrender its economic viability.

In international arbitration, Bolivia argued that the region had been part of the original Spanish colonial province of Moxos and Chiquitos to which Bolivia was heir. Meanwhile, Paraguay based its case on the occupation of the land. Indeed, both Paraguayan and Argentine planters were already breeding cattle and exploiting quebracho woods in the area, and the small nomadic indigenous population of Guaraní-speaking tribes was related to Paraguay's own Guaraní heritage. As of 1919, Argentine banks owned 400,000 hectares of land in the eastern Chaco, and the Casado family, a powerful part of the Argentine oligarchy, held 141,000. The presence of Mennonite colonies in the Chaco, who settled there in the 1920s under the auspices of the Paraguayan Parliament, was another factor in favour of Paraguay's claim.

The impetus for war was exacerbated by a conflict between oil companies jockeying for exploration and drilling rights, with Royal Dutch Shell backing Paraguay and Standard Oil supporting Bolivia. The discovery of oil in the Andean foothills sparked speculation that the Chaco might prove a rich source of petroleum, and foreign oil companies were involved in the exploration. Standard Oil was already producing oil from wells in the high hills of eastern Bolivia, around Villa Montes. However, it is uncertain if the war would have been caused solely by the interests of the companies, not by aims of Argentina to import oil from the Chaco. In opposition to the " dependency theory" of the war's origins, the British historian Matthew Hughes argued against the thesis that Bolivian and Paraguayan governments were the "puppets" of Standard Oil and Royal Dutch Shell respectively by writing: "In fact, there is little hard evidence available in the company and government archives to support the theory that oil companies had anything to do with causing the war or helping one side or the other during the war". Nonetheless, "the blurred lines between the bank and the oil industry show that [Standard Oil] did indeed finance the Bolivian build-up, even if instigating the war was left to Bolivian generals."

The first confrontation between the two countries dates back to 1885, when the Bolivian entrepreneur Miguel Araña Suárez founded Puerto Pacheco, a port on the Upper Paraguay River, south of Bahía Negra. He assumed that the new settlement was well inside Bolivian territory, though Bolivia had implicitly recognized Bahía Negra as Paraguayan. The Paraguayan government sent in a naval detachment aboard the gunboat Pirapó, which forcibly evicted the Bolivians from the area in 1888. Two agreements followed, in 1894 and 1907, which neither the Bolivian nor the Paraguayan Parliaments ever approved. Meanwhile, in 1905 Bolivia founded two new outposts in the Chaco, Ballivián and Guachalla, this time along the Pilcomayo River. The Bolivian government ignored the halfhearted Paraguayan official protest.

Bolivian penetration in the region went unopposed until 1927, when the first blood was shed over the Chaco Boreal. On 27 February, a Paraguayan Army foot patrol and its native guides were taken prisoners near the Pilcomayo River and held in the Bolivian outpost of Fortin Sorpresa, where the commander of the Paraguayan platoon, Lieutenant Adolfo Rojas Silva, was shot and killed in suspicious circumstances. Fortín (Spanish for "little fort") was the name used for the small pillbox and trench-like garrisons in the Chaco, although the troops' barracks usually were no more than a few mud huts. The Bolivian government formally regretted the death of Rojas Silva, but Paraguayan public opinion called it "murder." After subsequent talks arranged in Buenos Aires failed to produce any agreement and eventually collapsed in January 1928, the dispute grew violent. On 5 December 1928, a Paraguayan cavalry unit overran Fortin Vanguardia, an advance outpost established by the Bolivian army a few kilometres northwest of Bahía Negra. The Paraguayans captured 21 Bolivian soldiers and burned the scattered huts to the ground.

The Bolivians retaliated with an air strike on Bahía Negra on 15 December, which caused few casualties and little damage. On 14 December, Bolivia seized Fortin Boquerón, which later would be the site of the first major battle of the campaign, and 15 Paraguayan died. A return to the status quo ante was eventually agreed on 12 September 1929 in Washington, DC, under pressure from the Pan American League, but an arms race had already begun, and both countries were on a collision course. The regular border clashes might have led to war in the 1920s if either side had been capable of waging war against one another. As it was, neither Paraguay or Bolivia had an arms industry, and both sides had to import vast quantities of arms from Europe and the United States to arm themselves for the coming conflict. It was the need for both sides to import sufficient arms that held back the outbreak of the war to 1932, when both sides felt capable of resorting to arms to settle the long-running dispute.

Ford trucks like those used by both armies to resupply their troops

Bolivian infantry forces were armed with the latest in foreign weapons, including DWM Maxim M1904 and M1911 machine guns, Czechoslovak ZB vz. 26 and Vickers-Berthier light machine guns, Mauser-type Czechoslovak VZ-24 7.65 mm rifles ( mosquetones) and Schmeisser MP-28 II 9 mm submachine guns. At the outset, the Paraguayan troops used a motley collection of small arms, including the German Maxim, the British Vickers, the Browning MG38 water-cooled machine guns, and the Danish Madsen light machine gun. The primary service rifle was the M1927 7.65 mm Paraguayan Long Rifle, a Mauser design based on the M1909 Argentine Long Rifle and manufactured by the Oviedo arsenal in Spain. The M1927 rifle, which tended to overheat in rapid fire, proved highly unpopular with the Paraguayan soldiers. Some M1927 rifles experienced catastrophic receiver failures, a fault that was later traced to faulty ammunition. After the commencement of hostilities, Paraguay captured sufficient numbers of Bolivian VZ-24 rifles and MP 28 submachine guns (nicknamed piripipi) to equip all of its front-line infantry forces.

Paraguay had a population only a third as large as that of Bolivia (880,000 vs. 2,150,000). However, Paraguay gained the upper hand because of its innovative style of fighting, centered on rapid marches and flanking encirclements, compared to Bolivia's more conventional strategy. In June 1932, the Paraguayan Army totaled about 4,026 men (355 combat officers, 146 surgeons and non-combatant officers, 200 cadets, 690 NCOs and 2,653 soldiers). Both racially and culturally, the Paraguayan Army was practically homogeneous. Almost all of its soldiers were European-Guaraní . Bolivia's army, however, were mostly descended from the Altiplano's aboriginals of Quechua or Aymará (90% of the infantry troops), while the lower-ranking officers were of Spanish or other European ancestry, and the army commander-in-chief, Hans Kundt, was German. Although the Bolivian army had more manpower, it never mobilized more than 60,000 men, and no more than two-thirds of its army were ever on the Chaco. Paraguay, on the other hand, mobilized its entire army. A British diplomat reported in 1932 that the average Bolivian had never been anywhere close to the Chaco and "had not the slightest expectation of visiting it in the course of his life." Most Bolivians had little interest in fighting, let alone dying, for the Chaco. Furthermore, the typical Bolivian soldier was a Quechua or Aymara peasant conscript accustomed to life high in the Andes Mountains and did not fare well in the low-lying, hot, and humid land of the Chaco.

Many Paraguayan Army commanders had gained combat experience as volunteers with the French Army in World War I. Its army commander, Colonel (later General and then Marshal) José Félix Estigarribia, soon rose to the top of the combat command. Estigarribia capitalized on the native Guarani knowledge of the forest and ability to live off the land to gain valuable intelligence on conducting his military campaigns. Estigarribia preferred to bypass Bolivian garrisons, and his subordinates, such as Colonel Rafael Franco, proved adept at infiltrating enemy lines often by encirling Bolivian strongholds (Paraguay held over 21,000 prisoners-of-war when the war ended, Bolivia some 2,500). Both sides resorted to entrenched strongpoints and used barbed wire, mortars, machineguns, and mines with interlocking fields of fire.

Paraguay's war effort was total. Buses were commandeered to transport troops, wedding rings were donated to buy weapons, and Paraguay had by 1935 widened conscription to include 17-year-olds and policemen. Perhaps the most important advantage enjoyed by Paraguay was that the Paraguayans had a rail network running to the Chaco with five narrow-gauge railroads totaling some 428 kilometres (266 mi) running from thee ports on the Paraguay River to the Chaco, which allowed the Paraguayan Army to bring men and supplies to the front far more effectively than the Bolivians ever managed. In 1928, the British legation in La Paz reported to London that it took the Bolivian Army two weeks to march their men and supplies to the Chaco and that Bolivia's "inordinately long lines of communication" would help Paraguay if war broke out. Furthermore, the drop in altitude from 3,700 m (12,000 ft) in the Andes to 150 metres (500 ft) in the Chaco imposed further strain on Bolivia's efforts to supply its soldiers in the Chaco. Bolivia's railroads did not run to the Chaco, and all Bolivian supplies and soldiers had to travel to the front on badly-maintained dirt roads. Hughes wrote that the Bolivian elite was well aware of the logistical problems but that throughout the war, Bolivia's leaders had a "fatalistic" outlook. It took for granted that the fact that the Bolivian Army had been trained by a German military mission whilst the Paraguayan Army had been trained by a French military mission, together with the tough nature of their Quechua and Aymara Indian conscripts and the country's will to win and determination, would give them the edge in the war.

Both armies deployed a significant number of cavalry regiments, but they actually served as infantry since it was soon learned that the dry Chaco could not provide enough water and forage for horses. Only a relatively few mounted squadrons carried out reconnaissance missions at the divisional level.

Armor, artillery, and motorized forces

At the insistence of the Minister of War General Hans Kundt, Bolivia purchased a number of light tanks and tankettes for support of infantry forces. German instructors provided training to the mostly-Bolivian crews, who received eight weeks' training. The Vickers light tanks bought by Bolivia were the Vickers Type A and Type B, commissioned into the Bolivian army in December 1932 and were originally painted in camouflage patterns.

Hampered by the geography and difficult terrain of the Gran Chaco, combined with scarce water sources and inadequate logistical preparations, the Bolivian superiority in vehicles (water-cooled), tanks, and towed artillery did not prove decisive in the end. Thousands of truck and vehicle engines succumbed to the thick Chaco dust, which also jammed the heavy water-cooled machine guns employed by both sides. Having relatively few artillery pieces of its own, Paraguay purchased a quantity of Stokes-Brandt Model 1931 mortars. Highly portable (each of three parts could be carried by a soldier) and accurate, with a range of 3,000 yards, the angu'as ("corn-mashers" or "mortar" in Guarani) caused many casualties among Bolivian troops. In the course of the conflict, Paraguayan factories developed their own type of pyrotechnic-ignater hand grenade, the pineapple shaped carumbe'i (Guaraní for "little turtle") and produced trailers, mortar tubes, artillery grenades, and aerial bombs. The Paraguayan war effort was centralized and led by the state-owned national dockyards, managed by José Bozzano. The Paraguayan Army received its first consignment of carumbe'i grenades in January 1933.

Logistics, communications, and intelligence

The Paraguayans took advantage of their ability to communicate over the radio in Guaraní, a language not spoken by the average Bolivian soldier. Paraguay had little trouble in transporting its army in large barges and gunboats on the Paraguay River to Puerto Casado and from there directly to the front lines by railway, but most Bolivian troops had to come from the western highlands, some 800 km away and with little or no logistic support. In fact, it took a Bolivian soldier 14 days to cross the distance, as opposed to a Paraguayan soldier's four. The heavy equipment used by the Bolivian Army made things even worse. The poor water supply and the dry climate of the region played a key role during the conflict. There were thousands of non-combat casualties from dehydration, mostly by the Bolivian troops.

One of the key Paraguayan assets was the gunboat Humaitá, shown here shortly after being launched in Italy, without its main armament.

The Chaco War is also important historically as the first instance of large-scale aerial warfare to take place in the Americas. Both sides used obsolete single-engined biplane fighter-bombers. The Paraguayans deployed 14 Potez 25s, and the Bolivians made extensive use of at least 20 CW-14 Ospreys. Despite an international arms embargo imposed by the League of Nations, Bolivia in particular went to great lengths in trying to import a small number of Curtiss T-32 Condor II twin-engined bombers, disguised as civil transport planes, but they were stopped in Peru before they could be delivered.

The valuable aerial reconnaissance produced by Bolivia's superior air force in spotting approaching Paraguayan encirclements of Bolivian forces was largely ignored by Kundt and other Bolivian Army generals, who tended to dismiss such reports as exaggerations by overzealous airmen.

Four Junkers Ju 52s were purchased by Bolivia, which used the German transports mainly for medical evacuation and air supply. The Ju 52s alone delivered more than 4,400 tons of cargo to the front.

The Paraguayan Navy played a key role in the conflict by carrying thousands of troops and tons of supplies to the front lines via the Paraguay River, as well as by providing anti-aircraft support to transport ships and port facilities.

The , two Italian-built gunboats, ferried troops to Puerto Casado. On 22 December 1932, three Bolivian Vickers Vespas attacked the Paraguayan riverine outpost of Bahía Negra, on the Paraguay River, and killed an army colonel, but one of the aircraft was shot down by the gunboat . Both surviving Vespas met another gunboat, the Humaitá, while they were flying downriver. Paraguayan sources claim that one of them was damaged. Conversely, the Bolivian army reported that the Humaitá limped back to Asunción seriously damaged. The Paraguayan Navy admitted that Humaitá was struck by machine gun fire from the aircraft but claimed that its armor shield averted damage.

Shortly before 29 March 1933, a Bolivian Osprey was shot down over the Paraguay River, and on 27 April, a strike force of six Ospreys launched a successful mission from the base at Muñoz against the logistic riverine base and town of Puerto Casado, but the strong diplomatic reaction of Argentina prevented any further strategic attacks on targets along the Paraguay River. On 26 November 1934, the Brazilian steamer Paraguay was strafed and mistakenly bombed by Bolivian aircraft while it was sailing the Paraguay River near Puerto Mihanovich. The Brazilian government sent 11 naval planes to the area, and its navy began to convoy shipping on the river.

The Paraguayan navy air service was also very active in the conflict by harassing Bolivian troops deployed along the northern front with flying boats. The aircraft were moored at Bahía Negra Naval Air Base, and consisted of two Macchi M.18s. The seaplanes carried out the first night air attack in South America when they raided the Bolivian outposts of Vitriones and San Juan, on 22 December 1934. The Paraguayan Navy has celebrated ever since the annual "Day of the Naval Air Service" on the anniversary of the action.

The Bolivian Army deployed at least 10 locally-built patrol boats and transport vessels during the conflict, mostly to ship military supplies to the northern Chaco through the Mamoré- Madeira system. The transport ships Presidente Saavedra and Presidente Siles steamed on the Paraguay River from 1927 to the beginning of the war, when both units were sold to private companies. The 50-ton armed launch Tahuamanu, based in the Mamoré-Madeira fluvial system, was briefly transferred to Laguna Cáceres to ferry troops downriver from Puerto Suárez and challenged for eight months the Paraguayan naval presence in Bahía Negra. She was withdrawn to the Itenez River, in northern Bolivia, after Bolivian aerial reconnaissance revealed the actual strength of the Paraguayan Navy in the area.

On 15 June 1932, a Bolivian detachment captured and burned to the ground the Fortín Carlos Antonio López at Pitiantutá Lake. The captain in charge had disobeyed explicit orders by Bolivian President Daniel Salamanca to avoid provocations in the Chaco region. One month later, on 16 July, a Paraguayan detachment drove the Bolivian troops from the area. The lake had been discovered by Paraguayan explorers in March 1931, but the Bolivian High Command was unaware of that when one of its aircraft spotted the lake in April 1932.

After the initial incident, Salamanca changed his status quo policy over the disputed area and ordered the outposts of Corrales, Toledo, and Fortín Boquerón to be captured. All three were soon taken, and in response, Paraguay called for a Bolivian withdrawal. Salamanca instead demanded that they were included in a "zone of dispute." On a memorandum directed to Salamanca on 30 August, Bolivian General Filiberto Osorio expressed his concerns over the lack of a plan of operations and attached one that focused on an offensive from the north. Quintanilla also asked for permission to capture two additional Paraguayan garrisons: Nanawa and Rojas Silva. In August, Bolivia slowly reinforced its 4,000-men First Bolivian Army, which was already in the conflict's zone, with 6,000 men.

The breaking of the fragile status quo in the disputed areas of the Chaco by Bolivia convinced Paraguay that a diplomatic solution on agreeable terms was impossible. Paraguay gave its general staff orders to recapture the three forts. In August, Paraguay mobilized over 10,000 troops and sent them into the Chaco region. Paraguayan Lieutenant Colonel José Félix Estigarribia prepared for a large offensive before the Bolivians had mobilized their whole army.

Fortín Boquerón was the first target of the Paraguayan offensive. The Boquerón compound was guarded by 619 Bolivian troops and resisted a 22-day siege by a 5,000-man Paraguayan force. An additional 2,500 Bolivians attempted to relieve the siege from the southwest but were beaten back by 2,200 Paraguayans, who defended the accesses to the siege area. A few Bolivian units managed to enter Fortín Boquerón with supplies, and the Bolivian Air Force dropped food and ammunition to the besieged soldiers. Having begun on 9 September, the siege ended when Fortín Boquerón finally fell on 29 September 1932.

After the fall of Fortín Boquerón, the Paraguayans continued their offensive and executed a pincer movement, which forced some of the Bolivians to surrender. The Paraguayans had expected to lay a new siege on Fortín Arce, the most advanced Bolivian outpost in the Chaco, but when they got there, they found it in ruins. The 4,000 Bolivians who were defending Arce had retreated to the southeast to Fortín Alihuatá and Saveedra.

In December 1932, Bolivia's war mobilization had concluded. In terms of weaponry and manpower, its army was ready to overpower the Paraguayans. General Hans Kundt, a former German officer who had fought on the Eastern Front of World War I, was called by Salamanca to lead the Bolivian counteroffensive. Kundt had served intermittently as military advisor to Bolivia since the beginning of the century and had established good relationships with officers of the Bolivian Army and the country's political elites.

The Paraguayan Fortín Nanawa was chosen as the main target of the Bolivian offensive and was to be followed by the command centre at Isla Poí. Their capture would allow Bolivia to reach the Paraguay River and to endanger the Paraguayan city of Concepción. The capture of the fortines of Corrales, Toledo, and Fernández by the Bolivian Second Corps were also part of Kundt's offensive plan.

In January 1933, the Bolivian First Corps began its attack on Fortín Nanawa. The stronghold was considered by the Paraguayans to be the backbone of their defenses. It had zig-zag trenches; kilometres of barbed wire; and many machine-gun nests, some of which were embedded in tree trunks. The Bolivian troops had stormed the nearby Paraguayan outpost of Mariscal López, which isolated Nanawa from the south. On 20 January 1933, Kundt, who personally commanded the Bolivian force, launched six to nine aircraft and 6,000 unhorsed cavalry supported by 12 Vickers machine guns. However, the Bolivians failed to capture the fort but formed a defensive amphitheater in front of it. The Second Corps managed to capture Fortín Corrales and Fortín Platanillos but failed to take Fortín Fernández and Fortín Toledo. After a siege that lasted from 26 February to 11 March 1933, the Second Corps aborted its attack on Fortín Toledo and withdrew to a defensive line, built 15 km from Fortín Corrales.

After the ill-fated attack on Nanawa and the failures at Fernández and Toledo, Kundt ordered an assault on Fortín Alihuatá. The attack on the fortín overwhelmed its few defenders. The capture of Alihuatá allowed the Bolivians to cut the supply route of the Paraguayan First Division. When the Bolivians were informed of the isolation of the First Division, they launched an attack on it. The attack led to the Battle of Campo Jordán, which concluded in the retreat of the Paraguayan First Division to Gondra.

In July 1933, Kundt, still focusing on capturing Nanawa, launched a massive frontal attack on the fortín in what came to be known as the Second Battle of Nanawa. Kundt had prepared for the second attack in detail by using artillery, airplanes, tanks, and flamethrowers to overcome Paraguayan fortifications. The Paraguayans, however, had improved existing fortifications and built new ones since the First Battle of Nanawa. The Bolivian two-pronged attack managed to capture parts of the defensive complex but was soon retaken by Paraguayan counterattacks by reserves. The Bolivians lost more than 2,000 men, who were injured or killed in the Second battle of Nanawa, but Paraguay lost only 559, men who were injured or killed. The failure to capture Nanawa and the heavy loss of life led Salamanca to criticize the Bolivian high command and to order it to spare more men. The defeat seriously damaged Kundt's prestige. In September, his resignation of his position as commander-in-chief was not accepted by the president. Nanawa was a major turning point in the war since the Paraguayan Army regained the strategic initiative, which had belonged to the Bolivians since early 1933.

Maxim machine gun manned by Paraguayan soldiers

In September, Paraguay began a new offensive in the form of three separate encirclement movements in the Alihuatá area, which was chosen since its Bolivian forces had been weakened by the transfer of soldiers to attack Fortín Gondra. As a result of the encirclement campaign, the Bolivian regiments Loa and Ballivián, totaling 509 men, surrendered. The Junín regiment suffered the same fate, but the Chacaltaya regiment escaped encirclement because of the intervention of two other Bolivian regiments.

The success of the Paraguayan Army led Paraguayan President Eusebio Ayala to travel to the Chaco to promote José Félix Estigarribia to the rank of general. In that meeting, Ayala approved Estigarribia's new offensive plan. On the other side, the Bolivians gave up their initial plan of reaching the Paraguayan capital, Asunción, and switched to defensive and attrition warfare.

The Paraguayan Army executed a large-scale pincer movement against Fortín Alihuatá and repeated the previous success of those operations; 7000 Bolivian troops had to evacuate Fortín Alihuatá. On 10 December 1933, the Paraguayans finished their encirclement of the 9th and 4th divisions of the Bolivian Army. After attempts had been made to break through Paraguayan lines and 2,600 of their men had been killed, 7,500 Bolivian soldiers surrendered. Only 900 Bolivian troops, led by Major Germán Busch, managed to slip away. The Paraguayans obtained 8,000 rifles, 536 machine guns, 25 mortars, two tanks, and 20 artillery pieces from the captured Bolivians. By then, Paraguayan forces had captured so many Bolivian tanks and armored vehicles that Bolivia was forced to purchase Steyr Solothurn 15 mm anti-tank rifles to fend off its own armor. The remaining Bolivian troops withdrew to their headquarters at Muñoz, which was set on fire and evacuated on 18 December. Kundt resigned as chief of staff of the Bolivian Army.

The massive defeat at Campo de Vía forced the Bolivian troops near Fortín Nanawa to withdraw northwest to form a new defensive line. Paraguayan Colonel Rafael Franco proposed to launch a new attack against Ballivián and Villa Montes but was turned down, as Ayala thought that Paraguay had already won the war. A 20-day ceasefire was agreed upon between the warring parties on 19 December 1933. On 6 January 1934, when the armistice expired, Bolivia had reorganized its eroded army and had assembled a larger force than the one involved in its first offensive.

By early 1934, Estigarribia was planning an offensive against the Bolivian garrison at Puerto Suárez, 145 km upriver from Bahía Negra. The Pantanal marshes and the lack of canoes to navigate through them convinced the Paraguayan commander to abandon the idea and to turn his attention to the main front. After the armistice had ended, the Paraguayan Army continued its advance by capturing the outposts of Platanillos, Loa, Esteros, and Jayucubás. After the Battle of Campo de Vía in December, the Bolivian Army built up a defensive line at Magariños-La China. The line, carefully built, was considered to be one of the finest defensive lines of the war. However, a small Paraguayan attack on 11 February 1934, managed to breach the line to the surprise of the Paraguayan command, which forced the abandonment of the whole line. A Paraguayan offensive towards Cañada Tarija managed to surround and to neutralize 1,000 Bolivian troops on 27 March.

In May 1934, the Paraguayans detected a gap in the Bolivian defenses, which would allow them to isolate the Bolivian stronghold of Ballivián and to force its surrender. The Paraguayans worked all night to open a new route in the forests to make the attack possible. When Bolivian reconnaissance aircraft noticed the new path being opened in the forest, a plan was made to let the Paraguayans enter halfway up the path and then to attack them from the rear. The Bolivian operation resulted in the Battle of Cañada Strongest between 18 and 25 May. The Bolivians managed to capture 67 Paraguayan officials and 1,389 soldiers. After their defeat at Cañada Strongest, the Paraguayans continued their attempts to capture Ballivián. It was considered to be a key stronghold by the Bolivians, mostly for its symbolic position, since it was the most southeastern Bolivian position that remained after the second Paraguayan offensive.

In November 1934, Paraguayan forces once again managed to surround and to neutralize two Bolivian divisions at El Carmen. The disaster forced the Bolivians to abandon Ballivián and to form a new defensive line at Villa Montes. On 27 November 1934, Bolivian generals confronted Salamanca while he was visiting their headquarters in Villa Montes and forced him to resign. They replaced him with Vice President José Luis Tejada. On 9 November 1934, the 12,000-man-strong Bolivian Cavalry Corps managed to capture Yrendagüé and to put the Paraguayan Army on the run. Yrendagüé was one of the few places with fresh water in that part of the Chaco. Although the Bolivian cavalry was marching towards La Faye from Yrendagüé, a Paraguayan force recaptured all of the wells in Yrendague. Therefore, upon their return, the exhausted and thirsty Bolivian troops found themselves without water. The already-weakened force fell apart. Many were taken prisoner, and many of those who had avoided capture died of thirst and exposure after they had wandered aimlessly through the hot, dry forest. The Bolivian Cavalry Corps had been considered one of the best units of the new army that was formed after the armistice.

After the collapse of the northern and the northeastern fronts, the Bolivian defenses focused on the south to avoid the fall of their war headquarters and supply base at Villa Montes. The Paraguayans launched an attack towards Ybybobó and isolated some of the Bolivian forces on the Pilcomayo River. The battle began on 28 December 1934 and lasted until early January 1935. It caused 200 Bolivian troops to be killed and 1,200 to surrender, but the Paraguayans lost only a few dozen men. Some fleeing Bolivian soldiers were reported to have jumped into the fast-flowing waters of the Pilcomayo River to avoid capture.

After that defeat, the Bolivian Army prepared for a last stand at Villa Montes. The loss of that base would allow the Paraguayans to reach the proper Andes. Colonela Bernardino Bilbao Rioja and Oscar Moscoso were left in charge of the defenses after other high-ranking officers had declined. On 11 January 1935, the Paraguayans encircled and forced the retreat of two Bolivian regiments. The Paraguayans also managed in January to cut off the road between Villa Montes and Santa Cruz.

The Paraguayan commander-in-chief, Estigarribia, decided to launch a final assault on Villa Montes. On 7 February 1935, around 5,000 Paraguayans attacked the heavily fortified Bolivian lines near Villa Montes with the aim of capturing the oilfields at Nancarainza, but they were beaten back by the Bolivian First Cavalry Division. The Paraguayans lost 350 men and were forced to withdraw north toward Boyuibé. Estigarribia claimed that the defeat was largely because of the mountainous terrain in which his forces were not used to fighting. On 6 March, Estigarribia again focused all his efforts on the Bolivian oilfields, this time at Camiri, 130 km north of Villa Montes. The commander of the Paraguayan 3rd Corps, General Franco, found a gap between the Bolivian 1st and 18th Infantry regiments and ordered his troops to attack through it, but they became stuck in a salient with no hope of further progress. The Bolivian Sixth Cavalry forced the hasty retreat of Franco's troops to avoid being cut off. The Paraguayans lost 84 troops who were taken prisoner, and more than 500 dead were left behind. The Bolivians lost almost 200 men, but unlike their exhausted enemies, they could afford a long battle of attrition. On 15 April, the Paraguayans punched through the Bolivian lines on the Parapetí River and took over the city of Charagua. The Bolivian command launched a counteroffensive, which forced the Paraguayans back. Although the Bolivians' plan fell short of its target of encircling an entire enemy division, they managed to take 475 prisoners on 25 April. On 4 June 1935, a Bolivian regiment was defeated and forced to surrender at Ingavi, in the northern front, after a last attempt had been made to reach the Paraguay River. On 12 June, the day that the ceasefire agreement was signed, Paraguayan troops were entrenched only 15 km away from the Bolivian oil fields in Cordillera Province.

The military conflict ended with a comprehensive Paraguayan victory, but from a wider point of view, it was a disaster for both sides. Bolivia's Criollo elite had forcibly pressed large numbers of the male indigenous population into the army even though they felt little or no connection to the nation state,[citation needed ] and Paraguay fomented nationalist fervor among its predominantly-mixed population.[citation needed ] On both sides, especially Bolivia, soldiers were ill-prepared for the dearth of water and the harsh conditions of terrain and weather that they encountered. The effects of the lower-altitude climate had seriously impaired the effectiveness of the Bolivian Army. Most of its indigenous soldiers lived on the cold Altiplano, at elevations of over 3,700 metres (12,000 ft), and they found themselves at a physical disadvantage when they were called upon to fight in tropical conditions at almost sea level. In fact, of the war's 100,000 casualties, about 57,000 of whom were Bolivian, more soldiers died from diseases such as malaria and other infections than from combat-related causes.[citation needed ] Also, the war brought both countries to the brink of economic collapse.[citation needed ]

The Bolivian Army was dependent on food supplies that entered southeastern Bolivia from Argentina through Yacuíba. The army had great difficulty importing arms purchased at Vickers since both Argentina and Chile were reluctant to let war material pass through their ports. The only remaining options were the port of Mollendo, in Peru, and Puerto Suárez, on the Brazilian border. Eventually, Bolivia achieved partial success since Vickers had managed to persuade the British government to request Argentina and Chile to ease the import restrictions imposed on Bolivia. Internationally, the neighboring countries of Peru, Chile, Brazil, and Argentina tried to avoid being accused of fueling the conflict and so limited the imports of arms to both Bolivia and Paraguay, but Argentina supported Paraguay behind the neutrality façade. Paraguay received military supplies, economic assistance, and daily intelligence from Argentina throughout the war.

The Argentine Army established a special detachment along the border with Bolivia and Paraguay at Formosa Province in September 1932, called Destacamento Mixto Formosa, to deal with deserters from both sides trying to cross into Argentine territory and to prevent any boundary crossing by the warring armies, but the cross-border exchange with the Bolivian army was banned only in early 1934, after a formal protest by the Paraguayan government. By the end of the war, 15,000 Bolivian soldiers had deserted to Argentina. Some native tribes living on the Argentine bank of the Pilcomayo, like the Wichí and Toba people, were often fired at from the other side of the frontier or strafed by Bolivian aircraft, and a number of members of the Maká tribe from Paraguay, led by deserters, who had looted a farm on the border and killed some of its inhabitants, were engaged by Argentine forces in 1933. The Maká had been trained and armed by the Paraguayans for reconnaissance missions. After the defeat of the Bolivian Army at Campo Vía, at least one former Bolivian border outpost, Fortin Sorpresa Viejo, was occupied by Argentine troops in December 1933, which led to a minor incident with Paraguayan forces.

Chilean President Arturo Alessandri Palma has been suspected of turning a blind eye to the enrollment of Chileans in the Bolivian Army.

A number of volunteers and hired personnel from different countries participated in the war on both sides. The high command staff of both countries was at times dominated by Europeans. In Bolivia, General Hans Kundt, a German World War I Eastern Front veteran, was in command from the beginning of the war to December 1933, when he was relieved after a series of military setbacks. Apart from Kundt, Bolivia had also been advised in the last years of the war from a Czechoslovak military mission of World War I veterans. The Czechoslovak military mission assisted the Bolivian military after the defeat of Campo Vía. Paraguay was getting input from 80 former White Russian officers, including two generals, Nikolai Ern and Ivan Belaieff, the latter of whom was part of General Pyotr Nikolayevich Wrangel's staff during the Russian Civil War. In the later phase of the war, Paraguay would receive training from a large-scale Italian mission.

Bolivia had more than 107 Chileans fighting on its side. Three died from different causes in the last year of the conflict. The Chileans involved in the war enrolled privately and were mostly military and police officers. They were motivated by the unemployment caused by both the Great Depression and by the political turbulence in Chile in the early 1930s (after the Chaco War ended, some of the Chilean officers went on to fight in the International Brigades during the Spanish Civil War). The arrival of the first group of Chilean combatants in La Paz sparked protests from Paraguay and led the Chilean Congress on 7 September 1934 to approve a law that made it illegal to join the armies of countries at war. That did not, however, stop the enrollment of Chileans in the Bolivian Army, and it has been argued that Chilean President Arturo Alessandri Palma secretly approved of the practice to get rid of potentially-troublesome elements of the military.

The enrollment of Chilean military personnel in the Bolivian Army caused surprise in Paraguay since former Chilean President General Carlos Ibáñez del Campo in 1928 had supported Paraguay after Bolivian reprisals for the destruction of Fortin Vanguardia. The Paraguayan press denounced the Chilean government as not being neutral and went on to claim that the Chilean soldiers were mercenaries. On 12 August 1934, the Chilean ambassador in Asunción was recalled back to Santiago in response to official Paraguayan support of the accusations against the Chilean government in the press. Early in the war, however, a few Chilean officers had joined the Paraguayan Army.

At least two Uruguayan military pilots, Benito Sánchez Leyton and Luis Tuya, volunteered for some of the most daring missions carried out by Paraguayan Air Force Potez 25s, like the resupply of besieged forces during the Battle of Cañada Strongest and the mass air strike on the Bolivian stronghold of Ballivián on 8 July 1934. During the relief mission on Cañada Strongest, Leyton's Potez nº 7 managed to come back home although it had been hit by almost 200 rounds.

Argentina was a source of arms and ammunition for Paraguay. The Argentine military attaché in Asuncion, Colonel Schweizer, continued to advise the Paraguayan command well after the start of hostilities. However, the more valuable contribution to the Paraguayan cause came from Argentine military intelligence (G2), led by Colonel Esteban Vacareyza, which provided nightly reports on Bolivian movements and supply lines running along the border with Argentina. Argentine First World War veteran pilot Vicente Almandoz Almonacid was appointed Director of Military Aviation by the Paraguayan government from 1932 to 1933.

The open Argentine support for Paraguay was also reflected on the battlefield when a number of Argentine citizens, largely from Corrientes and Entre Ríos, volunteered for the Paraguayan Army. Most of them served in the 7th Cavalry Regiment "General San Martín" as infantrymen. They fought against the Bolivian Regiments "Ingavi" and "Warnes" at the outpost of Corrales on 1 January 1933 and had a narrow escape there after they had been outnumbered by the Bolivians. The commander of the "Warnes" Regiment, Lieutenant-Colonel Sánchez, was killed in an ambush set up by the retreating forces, while the Argentine volunteers lost seven trucks. The greatest achievement of "San Martín" took place on 10 December 1933, when the First Squadron, led by Second Lieutenant Javier Gustavo Schreiber, ambushed and captured the two surviving Bolivian Vickers six-ton tanks on the Alihuatá-Savedra road during the Battle of Campo Vía.

A major supporter of Paraguay was US Senator Huey Long. In a speech on the Senate floor on 30 May 1934, Long, a radical populist, claimed the war was the work of "the forces of imperialistic finance" and maintained that Paraguay was the rightful owner of the Chaco but that Standard Oil, which Long called "promoter of revolutions in Central America, South America and Mexico," had "bought" the Bolivian government and started the war because Paraguay had been unwilling to grant it oil concessions. Because Long believed that Standard Oil was supporting Bolivia, he greatly supported Paraguay, and in a speech about the war on the Senate floor on 7 June 1934, he called Standard Oil "domestic murder[re]s," "foreign murder[er]s," "international conspirators," and "rapacious thieves and robbers." As a result, Long became a national hero in Paraguay, and in the summer of 1934, when the Paraguayans captured a Bolivian fort, it was renamed Fort Long in his honor.

When a ceasefire was negotiated for noon 10 June 1935, Paraguay had controlled most of the region. The last half-hour had a senseless shootout between the armies. That was recognized in a 1938 truce, signed in Buenos Aires in Argentina and approved in a referendum in Paraguay by which Paraguay was awarded three-fourths of the Chaco Boreal, 52,000 km ² (20,000 sq mi). Bolivia was awarded navigation rights on the Paraguay and Paraná Rivers despite having been provided with such access before the conflict. Bolivia got the remaining territory, which bordered Puerto Busch.

The war cost both nations dearly. Bolivia lost between 56,000 and 65,000 people, 2% of its population, and Paraguay lost about 36,000, or 3% of its population.

Paraguay captured 21,000 Bolivian soldiers and 10,000 civilians (1% of the Bolivian population); many of the captured civilians chose to remain in Paraguay after the war. In addition, 10,000 Bolivian troops, many of them ill-trained and ill-equipped conscripts, deserted to Argentina or injured or mutilated themselves to avoid combat. By the end of hostilities, Paraguay had captured 42,000 rifles, 5,000 machine guns and submachine guns, and 25 million rounds of ammunition from Bolivian forces.

Bolivia's stunning military blunders during the Chaco War led to a mass movement, known as the Generación del Chaco, away from the traditional order, which was epitomised by the Revolutionary Nationalist Movement, which led the Revolution of 1952.

A final document to demarcate the border based on the 1938 border settlement was signed on 28 April 2009 in Buenos Aires.

Over the succeeding 77 years, no commercial amounts of oil or gas were discovered in the portion of the Chaco awarded to Paraguay. However, on 26 November 2012, Paraguayan President Federico Franco announced the discovery of oil in the area of the Pirity River. He claimed that "in the name of the 30,000 Paraguayans who died in the war," the Chaco would soon be "the richest oil zone in South America" and "the area with the largest amount of oil." In 2014, Paraguay made its first major oil discovery in the Chaco Basin, with the discovery of light oil in the Lapacho X-1 well.

Oil and gas resources extend also from the Villa Montes area and the portion of the Chaco awarded to Bolivia northward along the foothills of the Andes. Today, the fields give Bolivia the second-largest resources of natural gas in South America, after Venezuela.

Professor Bret Gustafson describes popular memory of the Chaco War, still "intensely felt" among Bolivians today, as one in which Bolivians are the "heroes of the Chaco" mobilized to "'defend the oil' from foreign usurpers.'" Other versions of this narrative blame Standard Oil or Argentina for provoking the conflict to rob Bolivia of its oil deposits. Stephen Cote, however, convincingly argues that at the time of the conflict, no known oil deposits existed in the disputed Chaco region. Instead, landlocked Bolivia was hoping to gain control of a river port that might be navigable to the Atlantic.

The war has been widely ignored in the English-speaking world with the British historian Matthew Hughes noting that one bibliography of books and articles on the war listed some 450 publications, of which only 14 were in English and only 2 were military, as opposed to diplomatic, histories of the war. In contrast, there is an enormous historical literature on the war in Spanish with the subject of the conflict being of lively interest in both Bolivia and Paraguay. Almost all of the historical work done in both nations is dominated by the "heroic" interpretation with the war being presented simply as a matter of willpower, with neither Bolivian nor Paraguayan historians having any interest in other aspects of the war like logistics as a determinate factor. Very typical of the Spanish language histories was Marshal Estigarribia's remark in his memoirs: "But to this organized and arrogant power we intended to oppose the virile tradition of our people and the discipline of our courage" That for him was a sufficient explanation of Paraguay's victory. Paraguayan historians tend to take the view that their nation won because the Paraguayan will to win was stronger, and likewise, Bolivian historians tend to argue that if only the Bolivian Army had fought harder, their nation somehow would have been victorious. Hughes stated that most of the historical work on the Chaco War was not of the highest quality: "It is difficult in the Spanish language literature to discern any clear trends in terms of a conceptual, analytical or theoretical framework with a critical, objective core that unpacks the main military aspects of the conflict, precisely the sort of approach that is becoming commonplace for military studies of other major wars of the contemporary period".

As part of the "heroic" interpretation, writing on the war in both Bolivia and Paraguay tends to be taken up with reminiscences of veterans, with little attempt to link up the experiences of the ordinary soldiers to the broader story of the war and in a way that many outsiders find off-putting to be obsessively making their nations' case for ownership of the Chaco.

Augusto Céspedes, the Bolivian ambassador to UNESCO, and one of the most important Bolivian writers of the 20th century, wrote several books describing different aspects of the conflict. As a war reporter for the newspaper El Universal, Céspedes witnessed the penuries of the war, which he described in Crónicas heroicas de una guerra estúpida ("Heroic Chronicles of a Stupid War") among other books. Several of his fiction works, which are considered masterworks of the genre, used the Chaco War as a setting. Another diplomat and important figure of Bolivian literature, Adolfo Costa du Rels, wrote about the conflict, and his novel Laguna H3, published in 1938, was also set during the Chaco War.

One of the masterpieces of the Paraguayan writer Augusto Roa Bastos, the 1960 novel Hijo de hombre, described in one of its chapters the carnage and harsh war conditions during the Siege of Boquerón. The author himself took part in the conflict by joining the Paraguayan Navy's medical service on board the transport ship Holanda at the age of 17. The Argentine film Hijo de Hombre or , directed by Lucas Demare in 1961, was based on this part of the novel.

In Pablo Neruda's poem, "Standard Oil Company," he referred to the Chaco War in the context of the role that oil companies had played in the war.

The Chaco War, particularly the brutal Battle of Nanawa, played an important role in the adventure novel Wings of Fury, by R. N. Vick.

The Paraguayan polka, " Regimiento 13 Tuyutí," composed by Ramón Vargas Colman and written in Guaraní by Emiliano R. Fernández, remembered the Paraguayan Fifth Division and its exploits in the battles around Nanawa in which Fernández fought and was injured. On the other side, the Siege of Boquerón inspired "Boquerón abandonado", a Bolivian recorded by the Bolivian folk singer and politician Zulma Yugar in 1982.

The Broken Ear, one of The Adventures of Tintin series of comic stories by the Belgian author Hergé (Georges Rémi), is set during a fictionalized account of the war between the invented nations of San Theodoros and Nuevo Rico.

Federico Funes, an Argentine aviator and writer, published "Chaco: Sudor y Sangre" ("Chaco: Sweat and Blood"), a fictionalized story about an Argentine volunteer pilot fighting for Paraguay in the 1930s.[citation needed ]

Barrage of Fire by the Bolivian novelist Oscar Cerruto narrated the cruel realities of life in Bolivia during the war through the experiences of a young protagonist.

Lester Dent, as Kenneth Robeson, wrote Dust of Death (1935), one of his Doc Savage pulp fiction novels. In it, Doc Savage finds himself caught in the middle of two embattled South American republics (obviously Bolivia and Paraguay) that have found a new and deadly foe in the form of an evil hooded figure, known as The Inca in Gray. When The Inca deploys a deadly "Dust of Death" to slaughter citizens on both sides of the fighting, Doc Savage and his team rush into the battle to try to save the day and to avoid the firing line.

The film (2020), directed by Diego Mondaca, follows a company of Bolivian soldiers wandering around the bush during the Chaco War in 1934.

de Quesada, A. M. (2011). The Chaco War 1932-1935: South America's Greatest Modern Conflict. Osprey Publishing.

de Ronde, Philip (1935). Paraguay: A Gallant Little Nation, The Story of Paraguay's War with Bolivia. G. P. Putnam's Sons.

The Chaco Peace Conference: Report of the Delegation of the United States of America to the Peace Conference Held at Buenos Aires July 1, 1935 - January 23, 1939 (1940). Department of State Publication 1466, Conference Series 46.

English, Adrian (2007). The Green Hell: A Concise History of the Chaco War between Bolivia and Paraguay, 1932-1935. Spellman.

Farcau, Bruce (1996). The Chaco War: Bolivia and Paraguay, 1932-1935. Praeger.

Finot, Enrique (1934). The Chaco War and the United States. L&S Print Co.

Garner, William (1966). The Chaco Dispute; A Study in Prestige Diplomacy. Public Affairs Press.

Rout, Leslie B., Jr. (1970). Politics of the Chaco Peace Conference, 1935-1939. University of Texas.

Sapienza, Antonio Luis (2018). The Chaco Air War 1932-35: The First Modern Air War in Latin America. Helion & Co.

Sapienza, Antonio Luis & Pelaez, Jose Luis Martinez (2020). The Chaco War 1932-1935: Fighting in the Green Hell. Helion & Co.

von Rauch, Georg (n.d.). "The Green Hell Air War". Air Enthusiast Quarterly (2): 207-213. ISSN 0143-5450.

Zook, David (1960). The Conduct of the Chaco War. Bookman.

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Chaco War Part of the interwar period Map of the Chaco War, showing important forts, military outposts, cities, and the Paraguayan advance to the west Date 9 September 1932 - 12 June 1935 (2 years, 9 months and 3 days) Location Result Paraguayan victory[6] Territorialchanges Most of the disputed area

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How oil and gas are fuelling global conflicts.

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How oil and gas are fuelling global conflicts.

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Fossil fuels are triggering violent conflicts all over the world, says Michael Klare, Professor of Peace and World Security Studies at Hampshire College in Massachusetts, the US. Klare zooms in on four areas - Iraq/Syria, South Sudan, the Crimea/Ukraine, and the South China Sea - to argue that the desire to control valuable oil and gas assets is fuelling long-standing historic tensions. "In a fossil-fuel world, control over oil and gas reserves is an essential component of national power," he warns.
Iraq, Syria, Nigeria, South Sudan, Ukraine, the East and South China Seas: wherever you look, the world is aflame with new or intensifying conflicts. At first glance, these upheavals appear to be independent events, driven by their own unique and idiosyncratic circumstances. But look more closely and they share several key characteristics - notably, a witch's brew of ethnic, religious, and national antagonisms that have been stirred to the boiling point by a fixation on energy.

In each of these conflicts, the fighting is driven in large part by the eruption of long-standing historic antagonisms among neighboring (often intermingled) tribes, sects, and peoples. In Iraq and Syria, it is a clash among Sunnis, Shiites, Kurds, Turkmen, and others; in Nigeria, among Muslims, Christians, and assorted tribal groupings; in South Sudan, between the Dinka and Nuer; in Ukraine, between Ukrainian loyalists and Russian-speakers aligned with Moscow; in the East and South China Sea, among the Chinese, Japanese, Vietnamese, Filipinos, and others. It would be easy to attribute all this to age-old hatreds, as suggested by many analysts; but while such hostilities do help drive these conflicts, they are fueled by a most modern impulse as well: the desire to control valuable oil and natural gas assets. Make no mistake about it: these are twenty-first-century energy wars.

Despite the patina of historical enmities, many of these conflicts are really struggles for control over the principal source of national income.

Moreover, we live in an energy-centric world where control over oil and gas resources (and their means of delivery) translates into geopolitical clout for some and economic vulnerability for others. Because so many countries are dependent on energy imports, nations with surpluses to export - including Iraq, Nigeria, Russia, and South Sudan - often exercise disproportionate influence on the world stage. What happens in these countries sometimes matters as much to the rest of us as to the people living in them, and so the risk of external involvement in their conflicts - whether in the form of direct intervention, arms transfers, the sending in of military advisers, or economic assistance - is greater than almost anywhere else.

The struggle over energy resources has been a conspicuous factor in many recent conflicts, including the Iran-Iraq War of 1980-1988, the Gulf War of 1990-1991, and the Sudanese Civil War of 1983-2005. On first glance, the fossil-fuel factor in the most recent outbreaks of tension and fighting may seem less evident. But look more closely and you'll see that each of these conflicts is, at heart, an energy war.

Iraq, Syria, and ISIS

The Islamic State of Iraq and Syria ( ISIS), the Sunni extremist group that controls large chunks of western Syria and northern Iraq, is a well-armed militia intent on creating an Islamic caliphate in the areas it controls. In some respects, it is a fanatical, sectarian religious organization, seeking to reproduce the pure, uncorrupted piety of the early Islamic era. At the same time, it is engaged in a conventional nation-building project, seeking to create a fully functioning state with all its attributes.

As the United States learned to its dismay in Iraq and Afghanistan, nation-building is expensive: institutions must be created and financed, armies recruited and paid, weapons and fuel procured, and infrastructure maintained. Without oil (or some other lucrative source of income), ISIS could never hope to accomplish its ambitious goals. However, as it now occupies key oil-producing areas of Syria and oil-refining facilities in Iraq, it is in a unique position to do so. Oil, then, is absolutely essential to the organization's grand strategy.

Without oil, ISIS could never hope to accomplish its ambitious goals.

At first, many rebel groups were involved in these extractive activities, but since January, when it assumed control of Raqqa, the capital of the province of that name, ISIS has been the dominant player in the oil fields. In addition, it has seized fields in neighboring Deir al-Zour Province along the Iraq border. Indeed, many of the U.S.-supplied weapons it acquired from the fleeing Iraqi army after its recent drive into Mosul and other northern Iraqi cities have been moved into Deir al-Zour to help in the organization's campaign to take full control of the region. In Iraq, ISIS is fighting to gain control over Iraq's largest refinery at Baiji in the central part of the country.

However the present fighting in northern Iraq plays out, it is obvious that there, too, oil is a central factor. ISIS seeks both to deny petroleum supplies and oil revenue to the Baghdad government and to bolster its own coffers, enhancing its capacity for nation-building and further military advances. At the same time, the Kurds and various Sunni tribes - some allied with ISIS - want control over oil fields located in the areas under their control and a greater share of the nation's oil wealth.

Ukraine, the Crimea, and Russia

By annexing the Crimea, Russia virtually doubled the offshore territory it controls in the Black Sea, which is thought to house billions of barrels of oil and vast reserves of natural gas.

Given this background, it is not surprising that a key objective of the " association agreement" between the EU and Ukraine that was repudiated by Yanukovych (and has now been signed by the new Ukrainian government) calls for the extension of EU energy rules to Ukraine's energy system - essentially eliminating the cozy deals between Ukrainian elites and Gazprom. By entering into the agreement, EU officials claim, Ukraine will begin "a process of approximating its energy legislation to the EU norms and standards, thus facilitating internal market reforms."

Nigeria and South Sudan

The conflicts in South Sudan and Nigeria are distinctive in many respects, yet both share a key common factor: widespread anger and distrust towards government officials who have become wealthy, corrupt, and autocratic thanks to access to abundant oil revenues.

With oil selling at around $100 per barrel, this represents a potentially staggering source of wealth for Nigeria [...] Were these revenues - estimated in the tens of billions of dollars per year - used to spur development [...] Nigeria could be a great beacon of hope for Africa.

Nigeria is the largest oil producer in Africa, pumping out some 2.5 million barrels per day. With oil selling at around $100 per barrel, this represents a potentially staggering source of wealth for the nation, even after the private companies involved in the day-to-day extractive operations take their share. Were these revenues - estimated in the tens of billions of dollars per year - used to spur development and improve the lot of the population, Nigeria could be a great beacon of hope for Africa. Instead, much of the money disappears into the pockets (and foreign bank accounts) of Nigeria's well-connected elites.

In February, the governor of the Central Bank of Nigeria, Lamido Sanusi, told a parliamentary investigating committee that the state-owned Nigerian National Petroleum Corporation (NNPC) had failed to transfer some $20 billion in proceeds from oil sales to the national treasury, as required by law. It had all evidently been diverted to private accounts. "A substantial amount of money has gone," he told the New York Times. "I wasn't just talking about numbers. I showed it was a scam."

The very formation of South Sudan is a product of oil politics.

The new state had barely been established, however, when conflict with the north over its oil resumed. While South Sudan has a plethora of oil, the only pipeline allowing the country to export its energy stretches across North Sudan to the Red Sea. This ensured that the south would be dependent on the north for the major source of government revenues. Furious at the loss of the fields, the northerners charged excessively high rates for transporting the oil, precipitating a cut-off in oil deliveries by the south and sporadic violence along the two countries' still-disputed border. Finally, in August 2012, the two sides agreed to a formula for sharing the wealth and the flow of oil resumed. Fighting has, however, continued in certain border areas controlled by the north but populated by groups linked to the south.

As in Syria and Iraq, much of the fighting in South Sudan has centered around the vital oil fields, with both sides determined to control them and collect the revenues they generate. As of March, while still under government control, the Paloch field in Upper Nile State was producing some 150,000 barrels a day, worth about $15 million to the government and participating oil companies. The rebel forces, led by former Vice President Machar, are trying to seize those fields to deny this revenue to the government. "The presence of forces loyal to Salva Kiir in Paloch, to buy more arms to kill our people... is not acceptable to us," Machar said in April. "We want to take control of the oil field. It's our oil." As of now, the field remains in government hands, with rebel forces reportedly making gains in the vicinity.

The South China Sea

In both the East China and South China seas, China and its neighbors claim assorted atolls and islands that sit astride vast undersea oil and gas reserves. The waters of both have been the site of recurring naval clashes over the past few years, with the South China Sea recently grabbing the spotlight.

An energy-rich offshoot of the western Pacific, that sea, long a focus of contention, is rimmed by China, Vietnam, the island of Borneo, and the Philippine Islands. Tensions peaked in May when the Chinese deployed their largest deepwater drilling rig, the HD-981, in waters claimed by Vietnam. Once in the drilling area, about 120 nautical miles off the coast of Vietnam, the Chinese surrounded the HD-981 with a large flotilla of navy and coast guard ships. When Vietnamese coast guard vessels attempted to penetrate this defensive ring in an effort to drive off the rig, they were rammed by Chinese ships and pummeled by water cannon. No lives have yet been lost in these encounters, but anti-Chinese rioting in Vietnam in response to the sea-borne encroachment left several dead and the clashes at sea are expected to continue for several months until the Chinese move the rig to another (possibly equally contested) location.

To view the Chinese drive in the South China Sea as a simple matter of nationalistic impulses would be a mistake.

The riots and clashes sparked by the deployment of HD-981 have been driven in large part by nationalism and resentment over past humiliations. The Chinese, insisting that various tiny islands in the South China Sea were once ruled by their country, still seek to overcome the territorial losses and humiliations they suffered at the hands the Western powers and Imperial Japan. The Vietnamese, long accustomed to Chinese invasions, seek to protect what they view as their sovereign territory. For common citizens in both countries, demonstrating resolve in the dispute is a matter of national pride.

But to view the Chinese drive in the South China Sea as a simple matter of nationalistic impulses would be a mistake. The owner of HD-981, the China National Offshore Oil Company ( CNOOC), has conducted extensive seismic testing in the disputed area and evidently believes there is a large reservoir of energy there. "The South China Sea is estimated to have 23 billion tons to 30 billion tons of oil and 16 trillion cubic meters of natural gas, accounting for one-third of China's total oil and gas resources," the Chinese news agency Xinhua noted. Moreover, China announced in June that it was deploying a second drilling rig to the contested waters of the South China Sea, this time at the mouth of the Gulf of Tonkin.

No End to Fighting

As these conflicts and others like them suggest, fighting for control over key energy assets or the distribution of oil revenues is a critical factor in most contemporary warfare. While ethnic and religious divisions may provide the political and ideological fuel for these battles, it is the potential for mammoth oil profits that keeps the struggles alive. Without the promise of such resources, many of these conflicts would eventually die out for lack of funds to buy arms and pay troops. So long as the oil keeps flowing, however, the belligerents have both the means and incentive to keep fighting.

In a fossil-fuel world, control over oil and gas reserves is an essential component of national power. "Oil fuels more than automobiles and airplanes," Robert Ebel of the Center for Strategic and International Studies told a State Department audience in 2002. "Oil fuels military power, national treasuries, and international politics." Far more than an ordinary trade commodity, "it is a determinant of well being, of national security, and international power for those who possess this vital resource, and the converse for those who do not."
If anything, that's even truer today, and as energy wars expand, the truth of this will only become more evident. Someday, perhaps, the development of renewable sources of energy may invalidate this dictum. But in our present world, if you see a conflict developing, look for the energy. It'll be there somewhere on this fossil-fueled planet of ours.
Editor's Note Michael T. Klare is a professor of peace and world security studies at Hampshire College and the author, most recently, of Copyright 2014 Michael T. Klare The Race for What's Left. A documentary movie version of his book Blood and Oil is available from the Media Education Foundation. This article was first published by Tomdispatch.com and is republished here with permission from publisher and author.

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Energy Wars: How oil and gas are fuelling global conflicts

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Oil and gas are triggering violent conflicts all over the world- Iraq/Syria, South Sudan, the Crimea/Ukraine, and the South China Sea- says Michael Klare.

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Sudan has had many conflicts since 1989. It has huge oil reserves (mainly controlled by other countries). This article explains all about it.

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Sudan stands on the brink of yet another civil war sparked by the deadly confrontation between the Sudan Armed Forces of General Abdelfatah El-Burhan and the Rapid Support Forces of Mohamed Hamdan Dagalo ("Hemedti").

Much of the international news coverage has focused on the clashing ambitions of the two generals. Specifically, that differences over the integration of the paramilitary Rapid Support Forces into the regular army triggered the current conflict on April 15, 2023.

I am a professor teaching at Columbia University and my research focuses on the political economy of the Horn of Africa. A forthcoming paper of mine in the Journal of Modern African Studies details the strategic calculus of the Sudan Armed Forces in managing revolution and democratisation efforts, today as well as in past transitions. Drawing on this expertise, it is important to underline that three decades of contentious energy politics among rival elites forms a crucial background to today's conflict.

The current conflict comes after a decade-long recession which has drastically lowered the living standards of Sudanese citizens as the state teetered on the brink of insolvency.

How energy has shaped Sudan's violent political economy

Long gone are the heady days when Sudan emerged as one of Africa's top oil producers. Close to 500,000 barrels were pumped every day by 2008. Average daily production in the last year has hovered around 70,000 barrels.

In the late 1990s, amid a devastating civil war, President Omar Al-Bashir's military-Islamist regime announced that energy would help birth a new economy. It had already paved the way for this reality, ethnically cleansing the areas where oil would be extracted. The regime struck partnerships with Chinese, Indian and Malaysian national oil companies. Growing Asian demand was met with Sudanese crude.

Petrodollars poured in. The regime in power between 1989 and 2019 oversaw a boom. This enabled it to weather internal political crises, increase the budgets of its security agencies and to spend lavishly on infrastructure. Billions of dollars were channelled to the construction and expansion of several hydro-electric dams on the Nile and its tributaries.

These investments intended to enable the irrigation of hundreds of thousands of hectares. Food crops and animal fodder were to be grown for Middle Eastern importers. Electricity consumption in urban centres was transformed; production in Sudan was boosted by thousands of megawatts. The regime spent more than US$10 billion on its dam programme. That's a phenomenal sum and testament to its belief that the dams would become the centrepiece of Sudan's modernised political economy.

South Sudan secedes

Then, in 2011, South Sudan seceded - along with three-quarters of Sudan's oil reserves. This exposed the illusions on which these dreams of hydro-agricultural transformation rested. The regime lost

half of its fiscal revenues, and about two-thirds of its international payment capacity.

The economy shrank by 10%. Sudan was also plagued by power cuts as the dams proved very costly and produced much less than promised. Lavish fuel subsidies were maintained but as evidence shows, these disproportionately benefited select constituencies in Khartoum and failed to protect the poor.

As the regime sank ever deeper into economic crisis, its security agencies concentrated on accumulating the means they deemed essential to survive, and to compete with each other. Both the Sudan Armed Forces and Rapid Support Forces deepened their involvement in Sudan's political economy. They took control of key commercial activities. These included meat processing, information and communication technology and gold smuggling.

Soaring fuel, food and fertiliser prices

This economic crisis fuelled a popular uprising which led to the overthrow of Al-Bashir. After the 2018-2019 revolution, the international community oversaw a power-sharing arrangement. This brought together Sudan Armed Forces, Rapid Support Forces and a civilian cabinet. Reforms were tabled to reduce spending on fuel imports and address the desperate economic situation.

However, the proposals for economic reform competed for government and international attention with calls to fast-track the "de-Islamisation" of Sudan, and to purge collaborators of the ousted regime from civil service ranks.

Inflationary pressures worsened as food and energy prices rose. It also strengthened a growing regional black market in which fuel, wheat, sesame and much else was illicitly traded across borders. At the same time, divisions grew in Sudan's political establishment and among protesters in its streets.

The government's efforts to push back against growing control of economic activities by the Sudan Armed Forces and Rapid Support Forces ultimately contributed to the October 2021 coup against Prime Minister Abdallah Hamdok.

Overlapping crises

The coup only deepened the crisis. So too did global supply shocks, such as those caused by the COVID-19 pandemic and the Russia-Ukraine conflict, which sent the prices of fuel, food and fertiliser skyrocketing globally, including in Sudan. Fertiliser prices increased by more than 400%. The state's retreat from subsidising essential inputs for agricultural production, such as diesel and fertiliser, led farmers to drastically reduce their planting, further exacerbating the food production and affordability crunch.

Amid these overlapping energy, food and political crises, Sudan's Armed Forces and Rapid Support Forces have been violently competing for control of the political economy's remaining lucrative niches, such as key import-export channels. Both believe the survival of their respective institutions is essential to preventing the country from descending into total disintegration.

In view of such contradictions and complexity, there are no easy solutions to Sudan's multiple crises. The political, economic and humanitarian situation is likely to worsen further.
A version of this article was first published by the Center on Global Energy Policy.

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Sudan's conflict has its roots in three decades of elites fighting over oil and energy

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The Sudanese crisis is the culmination of three decades of contentious energy politics among rival elites.

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The First Gulf War explained shortly by the U.S (winner) side

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NOTE TO READERS
"A Short History of the Department of State" has been retired and is no longer maintained. For more information, please see the full notice.

The First Gulf War

Of all the policy successes during this era, the Department of State and President Bush are most clearly associated with the successful effort to roll back the Iraqi invasion of Kuwait.

President G. H.W. Bush visiting the Troops during the First Gulf War

When Saddam Hussein invaded his small, oil-rich neighbor in the summer of 1990, the Department faced its first full-scale post-Cold War international crisis. Bush's foreign policy team forged an unprecedented international coalition consisting of the NATO allies and the Middle Eastern countries of Saudi Arabia, Syria, and Egypt to oppose Iraqi aggression. Although Russia did not commit troops, it joined the United States in condemning Iraq, its long-time client state. The Department of State orchestrated the diplomacy for this grand coalition's effective air campaign in January 1991, which was followed by "Operation Desert Storm," a 100-hour land war, which expelled Iraqi forces from Kuwait.

During the Gulf crisis, Secretary of State Baker relied heavily on two men-John Bolton, Assistant Secretary of State for International Organization Affairs, who played a significant role in coordinating relations with the United Nations, and Under Secretary of State for Political Affairs Robert Kimmitt, who was Baker's day-to-day crisis manager. One innovation that greatly facilitated decision-making during the Gulf War was the use of teleconferences, which saved many hours of travel time. Instead, Baker and others could communicate and display charts through cameras and television screens.

Assistant Secretary of State for International Organization Affairs, John Bolton

After the success in Kuwait, President Bush paid special tribute to the Foreign Service officers who labor in relative obscurity until they are caught up in a dangerous conflict or become the victims of international terrorism. President Bush made a special visit to the Department of State to honor 33 employees for their service at our embassies in Baghdad and Kuwait, which included finding food and supplies for trapped Americans in those countries and helping children to safe havens after fighting erupted. Acknowledging the peril most Americans never see, Bush said, "I know that often your jobs are not comfortable or safe."

Iraq was not the only trouble spot in the Middle East during Bush's four years in office. The perennial tension between Israel and its Arab neighbors continued to test the expertise of the many U.S. ambassadors and area experts. Baker's personal involvement, reflected in numerous trips to the region, helped bring about the first face-to-face talks between Israel and all of its Arab neighbors in Madrid, beginning in October 1991. Secretary Baker's "shuttle diplomacy" rivaled Henry Kissinger 's in 1974. From the beginning of Baker's tenure until August 23, 1992, when he resigned to become White House Chief of Staff, he made 217 trips abroad.

Lawrence Eagleburger, who succeeded Baker, became the first Foreign Service officer to serve as Secretary of State. During a 27-year government career, Eagleburger had been a staffer for Kissinger's National Security Council, and held numerous senior positions at the Department of State, including Under Secretary for Political Affairs, Deputy Under Secretary for Management, and Assistant Secretary for European Affairs. Eagleburger's appointment reflected Bush's deep respect for the Foreign Service. Bush compiled an impressive record of nominating career officers to ambassadorships (72 percent), one of the best records for all Presidents in the post-1945 era.

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The First Gulf War - Short History - Department History - Office of the Historian

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This video shows how conflict can affect the entire oil industry.

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Israel-Palestine Conflict: Impact on oil prices | World Business Watch

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This link provides examples of conflicts related with oil, but its opinion is very subjective.

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"Human-induced climate change and the war on Ukraine have the same roots: fossil fuels and our dependence on them" said Ukrainian climate scientist Svitlana Krakovska as Russia, one of the world's biggest oil and gas producers, was invading her country.

At the time, she was addressing The Intergovernmental Panel on Climate Change from her home in Kyiv, and had to withdraw from the approval session of the latest report as bombs hit her city.

A month later the war in Ukraine is now a humanitarian crisis: more than 3.7 million people who have fled the country, and roughly 13 million people are estimated to be unable to leave with limited access to food, water, and medical care.

Fossil fuels are fuelling the war in Ukraine

There's a direct relationship between fossil fuels and the Russian war machine. Rosneft, one of Russia's main petroleum companies, is reported to be one of the main suppliers of fuel to the Russian army. Rosneft also supplies petroleum to companies like BP. So every time Russian oil or gas are bought it's not just contributing funds to the war chest, it may be keeping military machinery running. Rosneft and subsidiary company Rosneft-Aero and Transneft reportedly delivered fuel to the Russian Army before and during the invasion. [1]

To stop this war we need a global divestment from, and an embargo on, Russian fossil fuels as soon as possible, as well as urgent delivery of humanitarian aid to those in need.

Greenpeace Nordic activists in peaceful protest on top of a construction crane overlooking the Swedish parliament. The activists have mounted a 30 meter long banner with the message "People Want Peace - Stop Fuelling war" directed at the Swedish political decision makers. © Greenpeace / Christian Åslund

Fossil fuels have a history with war

The struggle over energy resources has been a conspicuous factor in many recent conflicts, including the Iran-Iraq War of 1980-1988, the Gulf War of 1990-1991, and the Sudanese Civil War of 1983-2005. Greenpeace has spoken out about such conflicts in the past, especially during the last Iraq war.

The 1990 Gulf war was largely a conflict about oil. The issues which provided Iraq with the pretext for its invasion of Kuwait were oil pricing policies and oil revenues. Though oil was not the sole reason for Iraq's actions, it was a powerful motivator for swift action from the United States and its allies who moved quickly to protect its own and OECD countries' access to important oil supplies. And the large-scale exploitation of oil by foreign companies operating in southern Sudan has increased human rights abuses there and has exacerbated the long-running conflict in Sudan, resulting in two million people dying and four million displaced since 1983, as well as recurring famine and epidemics.

According to research in 2021 by Greenpeace Italy, Greenpeace Spain and Greenpeace Germany, almost two-thirds of all EU military missions monitor and secure the production and transport of oil and gas to Europe. The governments of Italy, Spain and Germany have invested more than €4 billion to protect climate-damaging fossil fuels since 2018.

Greenpeace activists hold a banner that reads "STOP FUNDING WAR" and paint "Peace - Not Oil" in two-meter letters on the side of the 40,000-ton tanker Seasprat, which delivers processed oil from the Russian Baltic port of Primorsk. The action in the port of Bremen is part of a protest against oil imports from Russia, which help finance Putin's war in Ukraine. © Axel Heimken / Greenpeace

Fossil fuel companies cannot be trusted

Early in the war in Ukraine, oil companies jumped on the opportunity to expand their operations, using a looming energy crisis as a reason to pedal their polluting business. Shell even bought oil from Russia after the invasion, and only apologised and pledged to cut ties with Russia after huge public backlash that could affect their bottom line. Now other oil companies such as BP and Total Energies promise to be divesting from Russia, after being directly linked to the Ukraine war.

Like big tobacco, these companies jump on any opportunity to keep selling their dirty products. Unless we continue to expose their dirty business model, they will continue to profit off conflict and climate crisis.

Fossil fuel trade is propping up an unjust system

To help ensure peace and stop the climate crisis, governments need to cut their dependency on fossil fuels and phase them out immediately. Today, the world economy is still running largely on fossil fuels which continue to make up for over 80% of the global energy mix.

This addiction to fossil fuels places energy security and climate action at the mercy of geopolitics. Governments cannot claim to stand for peace if they continue to finance war. And shifting from Russian oil and gas to oil and gas from other countries with questionable human rights records, like Venezuela or Saudi Arabia, will only shift geopolitical power from one abuser to another.

These power imbalances can lead to countries acting with impunity. At the recent COP26 global climate talks, leading oil and coal producers like Saudi Arabia and Australia stymied efforts to include fossil fuel phase-out in the final text, and countries like Russia and the United States are not members of the International Criminal Court which prosecutes war crimes.

Thousands of people form a huge peace sign to protest against the invasion of Ukraine and to express their compassion for the innocent victims of the war in Budapest's Heroes' Square. © Bence Jardany / Greenpeace

Renewable energy is a pathway to peace

In order to get to a more just and peaceful world, we need countries to cut their fossil fuel dependency. To transition quickly, wealthy countries must first reduce their energy demand and maximise energy efficiency. Then move fast to fill their remaining energy needs with renewable energy.

Unlike fossil fuels, renewable energy is less likely to feed geopolitical power struggles or inequality,as its infrastructure has the potential to be largely localised. This could in turn help to reduce trade with countries with questionable human rights records. Localised renewable energy could also help to protect consumers from price shocks like the global energy crisis we are seeing today.

Volunteers are installing the first solar panel. Between the 10th and 18th September, 12 volunteers are trained in solar photovoltaics. The training ends with a photovoltaic installation on the roof of the Greenpeace office in Kinshasa. The workshop is organized by Greenpeace Africa and the Youth Support Center of Greenpeace Switzerland. © Greenpeace / Crispin Assimbo Bosenge

Safeguarding energy security and the climate

The combination of renewable energy and energy efficiency is a better choice for energy security.If the potential of these two are combined, total global energy demand could be reduced by up to a quarter by 2030. Energy efficiency measures would account for half to three-quarters of the total energy savings, with renewables delivering the rest. This could have huge implications for safeguarding the climate, with fossil fuels being the number one contributor to global heating.

A fast and just transition to renewable energy is possible.Installing renewable capacity is much faster than building new fossil fuel infrastructure - In the UK it takes on average 28 years to develop a new oil well, versus two years to build a solar farm. And if the world invests in more renewable energy it will become an even cheaper, more viable option.Morocco and Egypt are rapidly scaling up their renewable energy capacity, and showing how collaboration can help everyone go farther and faster together.

This is a chance for governments to break the cycle of fossil fuel destruction and transition to a green peaceful future. Governments must act for peace and a safe climate with a transition to efficient and renewable energy as quickly as possible.
Marie Bout is Global Climate Communications Strategist at Greenpeace International
Reference:

[1] According to a 2017 report posted by the company in Russian, companies in the Rosneft group supplied the Russian Ministry of Defence, the Investigative Committee of the Russian Federation, the Russian Emergencies Ministry, the Russian Ministry of Internal Affairs, the Russian Guard and was at the time the sole supplier of motor fuels to the National Guard, which has since been deployed on the border with Ukraine.

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Fossil Fuels are fuelling war - Greenpeace International

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Human-induced climate change and the war on Ukraine have the same roots: fossil fuels and our dependence on them.

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Why oil is important

Oil: lifeblood of the industrialised nations Oil has become the world's most important source of energy since the mid-1950s. Its products underpin modern society, mainly supplying energy to power industry, heat homes and provide fuel for vehicles and aeroplanes to carry goods and people all over the world.
Most oil is used for transport (car, lorries and planes) but around a quarter used for heating, chemical plants and in other industry Source: DECC Here are some examples of what we owe to oil, every day of our lives:
In fact, oil meets 97 per cent of the UK transport sector demand. In addition, it also benefits our lives in being vital to the production of many everyday essentials. Oil's refined products are used to manufacture almost all chemical products, such as plastics, fertilisers, detergents, paints and even medicines, plus a whole host of other products that you might not expect.

Final energy consumption by fuel, UK (1970 to 2014)
Petroleum products used for energy by main sectors, UK (2000 to 2014)

At school: rulers, crayons, ink and cartridges, glue, coverings on books, binders...

For your health: coatings for pills, binding agent for creams, disposable syringes...

In the home: contact lenses, cosmetics, clothing, fabrics, nail polish, deodorants, shampoo, paint, upholstery and carpets, detergents for washing up and laundry, dry-cleaning fluid...

Out shopping: shopping bags, credit cards, egg cartons, plastic milk bottles

While cooking: non-stick pans, cling film, storage containers

For building: roofing tiles, pipes, insulating material, paint

On the move: petrol and diesel for cars and lorries, emergency services and trains, asphalt road surfaces

In the office: computer hardware, phones and faxes, diskettes, pens, chairs, printing ink

At your leisure: CDs, videos, cassette tapes, camera film, artists' paint, bicycle handlebar grips, tyres, crash helmets, football boots, trainers, shin pads, windsurfers, roller blades

Garden: fertilisers, pesticides, garden furniture

Source: DECC
Challenges Action Progress Future opportunities
Through its extensive supply chain, the oil & gas industry employs hundreds of thousands of people and makes a major contribution to the UK economy in terms of tax revenues, technologies and exports. Tens of thousands of people work in the oil and gas industry. Each week Britain produces about two million tonnes of oil and gas. This is worth about £37 million pounds a day to the people of Britain.

Sources: Oil & Gas in UK, Economic Report 2015

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Oil: lifeblood of the industrialised nations Oil has become the world's most important source of energy since the mid-1950s. Its products underpin modern society, mainly supplying energy to power industry, heat homes and provide fuel for vehicles and aeroplanes to carry goods and people all over the world.

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Energy - Crude oil production - OECD Data

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Find, compare and share OECD data by indicator.

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Global crude oil prices, measured in US dollars per cubic meter. This data is not adjusted for inflation.

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Russia produces lots of oil. THis explains its relationship with the current war.

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After weeks of tensions, Russian President Vladimir Putin ordered Russian troops to invade Ukraine, prompting an international sanctions response targeting Russia's economy but not directly its oil supplies or energy payments. But as sanctions on Russia intensified and as financial institutions started to refuse financing Russia-related transactions, including opening letters of credit or clearing payments and as some companies became reluctant to purchase Russian crude, Brent on March 2 (the time of writing) was trading above $110 for the first time since 2014.

Looking forward the market focus should not only be on whether the oil sector will be directly targeted by sanctions, but also the crescendo effect of self-sanctioning along the oil supply chain all the way from marketing to financing to shipping. Fears over energy sanctions and the ambiguity over the banking sanctions have already seen companies avoid purchasing Russian barrels, pushing prices to new multiyear highs and shaving-off shock mitigation policies such as the SPR releases. Also, it has become clear that traders holding Russian crude on their books are struggling to clear cargoes and this has been reflected in widening differentials and rising shipping and insurance costs.

The next stages for Russian crude supplies are highly uncertain but some possible impacts include:

- Massive shifts in trade flows and sharp adjustments in price differentials to reflect shifts in Russian crude exports. Particularly, there could be a greater re-redirection of flows from Europe to Asia, but there are limits to such re-direction and not all Urals previously destined to Europe will flow into Asia.

- Russian oil companies could offer sweeteners to buyers to make their barrels more attractive, for instance shifting cargoes from FOB to CFR basis. Also, in response to more extensive self-sanctioning, Urals and ESPO could be offered at discounts so large that cargoes would eventually clear, potentially as masked cargoes or via ship-to-ship transfers. But there are limits to this strategy given the large volumes of Russian exports and the intensification and widening of sanctions.

- Self-sanctioning escalates over the coming weeks leading to a reduction in Russian production and supply disruptions at a larger scale.

In the current environment of ever rising tensions, one should also not also exclude the possibility that in an escalation situation where Russia struggles to clear its barrels, weaponizing energy becomes the next chapter in Russia's ongoing standoff with the West. As these are still early days, a scenario in which Russian oil supplies get disrupted in a sudden manner should also be considered. This will exert significant pressure on both market balances and prices in the near-term and for most of 2022. In the short term, potential responses to ease the price pressure are likely to come from the supply side. The current plan of OPEC+ to return withheld supplies back to market, Iran fully returning to the market and non-OPEC production growth particularly in North America accelerating, these combined supply responses can help fill any potential supply gap. The planned SPR releases will offer little support to a potential shortfall. But in such scenario the demand responses will also play their role and become more visible beyond the near-term. In terms of products, the market and refiners appear less flexible faced with constraints both in terms of costs and feedstock availability. Also, the impacts of the current shock will extend beyond the short-term and beyond balances and prices. The recent crisis will elevate energy security (including oil security) in policy makers' agenda with long-term consequences for governments' energy policies including their energy transition.

By: Bassam Fattouh , Andreas Economou , Ahmed Mehdi
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Russia-Ukraine crisis: Implications for global oil markets

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After weeks of tensions, Russian President Vladimir Putin ordered Russian troops to invade Ukraine, prompting an international sanctions response targeting Russia's economy but not directly its oil supplies or energy payments. But as sanctions on Russia intensified and as financial institutions started to refuse financing Russia-related transactions, including opening letters of credit or clearing payments [...]

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World crude oil price vs. oil consumption

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World crude oil price vs. oil consumption

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World crude oil price vs. oil consumption

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Global crude oil price, measured in US dollars per cubic meter, against total oil consumption, measured in average cubic meters per day. Prices are adjusted for inflation.

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This is a video that explains which countries control most of the oil.

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Between 1912 and 2010, countries fought 180 times over territories that contained or were believed to contain oil or natural gas resources.

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Countries won’t fight for oil in the South China Sea—or anywhere else.

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How Russia's war in Ukraine is changing the world's oil markets

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How Russia's war in Ukraine is changing the world's oil markets

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Russia's war in Ukraine is causing a profound and permanent shift in the world's oil markets, creating new geopolitical alliances. Analysts say it's comparable to the 1970s Arab oil embargo.

ARI SHAPIRO, HOST:

Russia's war in Ukraine has implications far beyond the battlefield, including energy. The flow of oil, natural gas and refined products like diesel has been upended, leading to one of the largest shifts in the global energy market in decades. NPR's Jackie Northam reports.

JACKIE NORTHAM, BYLINE: Any American around at the time will likely remember the 1973 oil embargo. That's when Arab oil producers cut exports to the U.S. and other nations in retaliation for support of Israel during the Yom Kippur War. Gas stations ran dry. Prices skyrocketed. And the U.S. economy flattened. It also created a profound and permanent shift in energy markets as nations looked for new suppliers beyond the Middle East. Now, Russia's invasion of Ukraine has created another major shift in energy.

DAVID GOLDWYN: This really is the biggest transformation in the energy markets probably since 1973.

NORTHAM: David Goldwyn is with the energy advisory firm Goldwyn Global Strategies. He says these energy shifts aren't just about oil.

GOLDWYN: The Russian invasion of Ukraine has permanently redirected the flows of natural gas, crude oil and refined products.

NORTHAM: What jolted the global energy network was Russian President Vladimir Putin's decision to weaponize energy in retaliation for Europe's support of sanctions. Daniel Yergin is an energy specialist at S&P Global and author of the book "The New Map: Energy, Climate, And The Clash Of Nations." He says before the Ukraine war, Russia and Europe were highly integrated when it came to energy.

DANIEL YERGIN: That's over. Putin's really stopped the flow of most natural gas to Europe. And Europe has slammed the door on Russian oil and simply will not take anymore. And that has forced Russian oil into other markets and at a much lower price, principally India and China.

NORTHAM: Europe used to rely heavily on Russia for refined oil products, such as diesel. Now it's looking to India and China, which have become strategic suppliers of the commodities, says Karen Young with Columbia University's Center on Global Energy Policy.

KAREN YOUNG: The Indians are very, very happy to buy cheaper Russian oil, as have been the Chinese. They can take that Russian oil and turn it into other petroleum products and sell them and do it at quite a nice profit.

NORTHAM: Relying on China for its refining needs could leave Europe dependent on the Asian nation. But Young says sending Russian oil to Asian nations has also had a knock-on effect for other countries, including Saudi Arabia.

YOUNG: There are kind of, you know, long-standing customer relationships between the Gulf states and Asian customers. And so cheaper Russian product is a threat to those relationships.

NORTHAM: And it could give Saudi Arabia more leverage over Europe. David Goldwyn says Europe is looking to other Mideast countries for oil and places like Qatar and Algeria for natural gas. New fields are coming online in Africa. And Goldwyn says the U.S. has also become a critical supplier.

GOLDWYN: Two years ago, most U.S. oil was headed to Asia. Now it's headed to Europe. Two years ago, most U.S. liquefied natural gas was headed to Asia as well. Last year, Europe was the top destination. So the U.S. becomes a much more important strategic player.

NORTHAM: The U.S. may not feel the shock of the 1970s, but it's still vulnerable to sharp rises in the price of oil, which could happen again once China's economy starts to pick up steam. Most analysts agree one thing is certain - Russia's days as an energy superpower are likely over. Jackie Northam, NPR News.

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How Russia's war in Ukraine is changing the world's oil markets

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Russia's war in Ukraine is causing a profound and permanent shift in the world's oil markets, creating new geopolitical alliances. Analysts say it's comparable to the 1970s Arab oil embargo.

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The Oil war between Russia vs USA and Europe Explained | How will it change India? : Geopolitics

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The Oil war between Russia vs USA and Europe Explained | How will it change India? : Geopolitics

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The Oil war between Russia vs USA and Europe Explained | How will it change India? : Geopolitics