Prices of WTI went up significantly on Friday 29.01. Crottaz. O. asks if we are at the beginning of an increase in oil prices due to the risks of propagation of political unrest and revolution spreading throughout the arab world, especially into Algeria and Lybia, which produces together up to 5% of world oil.
The analysis reflects the political embeddedness underpinning this situation. In an excellent post, John Quiggin links the "Arab exception" - the idea that the concept of democracy is not really applicable in Arab countries and that foreign policy therefore amounts to a choice of which dictator to support - to the idea of oil as a special case. The idea of the "Arab exception"
...rests on the assumption that the existing governments are less than legitimate, and can be dealt with in terms of traditional Great Power politics, with spheres of influence, secret deals and so on. Even weak democratic states display much more effective resistance to external interference in their domestic affairs than do typical autocratic regimes. The point applies most obviously in relation to oil. The idea that the US can legitimately use its military power to ensure continued access to oil resources rests, in large measure, on the (not entirely unfounded) assumption that those controlling the resources are a bunch of sheikhs and military adventurers who happened to be in the right place, with guns, at the right time. Without the Arab exception, the idea of oil as a special case, not subject to the ordinary assumption that resources are the property of the people in whose country they are found, will also be hard to sustain.
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