Hopkins graduate student Roger Stern didn't set out to change the way Americans think about oil, let alone end up challenging the basis of our relationship with the countries that produce it.
Rather, Stern came to Hopkins to study oil's insoluble opponent: water. "I came to Hopkins to study water pollution in relation to farm subsidies," he said. "Then, about a week into my graduate program, 9/11 happened."
Like so many other long-haul commuters on the East Coast, Stern, who lives in Massachusetts, found himself with an unfamiliar feeling of uncertainty as he commuted to and from Baltimore.
By his own admission, "It caused me to think a lot more about security issues," and even take a Hopkins seminar on the subject. And while for many of us this would quench our intellectual curiosity, Stern became fascinated with the "why" of terrorism.
Calling on his background in the earth sciences, Stern hit upon an area of study: the confluence of "petroleum, economics and society." His research came to fruition and led him to write two lines with big consequences: "[The oil] weapon has failed to harm the U.S. c9 Oil is abundant, not scarce."
From those two ideas, Stern sets out to debunk a series of popular oil myths related to oil and U.S. policy.
In a paper recently published in the journal Proceedings of the National Academy of Sciences, Stern makes the argument that what the U.S. has long feared, a strangling oil embargo by the Middle East, is implausible. With little more than a phrase, Stern renders the supposed "oil weapon" impotent.
Instead, the fear that oil is running out could easily be a myth advanced by the oil cartels and oil companies, Stern says, all of whom stand to gain from perceptions that drive up crude prices.
Simultaneously, these myths has also led to the U.S. policy of stabilizing the oil producing Middle East out of fear that they will lose their oil interests.
"[It] is one little part of a whole set of misconceptions, the oil weapon is a belief that our supply can be physically interrupted. I challenge that idea by pointing out the diversity of the oil supply and how highly dependant the suppliers are on the oil revenue. c9 What's much more interesting to me than the fact that the oil weapon is plausible is that why it is so widely believed," Stern said.
He raises a valid point: Why are embargoes so feared if they have never truly worked?
Stern argues that historically, oil embargoes have never been effective, as there is always a third country ready to step in and sell oil to the embargoed country, and have never lasted since the oil-producing nations who are cutting off their sales depend so much on petroleum revenue. In analyzing the infamous 1973 oil crisis, Stern wrote: "Supply was not greatly affected. Cuts were real but the high price owed also to hoarding and import controls. ... Diplomats misread the market."
The skyrocketing gas prices of the 70s, Stern explained, were largely irrational ones caused by misperceptions of the market.
In an age when gas prices are often steep and more demand is placed on oil reserves, Stern points out that, economically speaking, oil has been growing more abundant (read: cheaper), rather than scarcer over the past years.
He bases this argument on the fact that it costs less today to fill up a barrel of oil than it ever did. Saudi costs have declined from roughly $4 per barrel in the 1970s to today's $1.50 per barrel. If oil was ever to run dangerously low, this number would skyrocket. There is little sign that this will happen anytime soon.
"The total reserves are about 3 trillion barrels. The total amount of oil that has been extracted between 1859 and today is less than 1 trillion. There's a lot of oil out there -- it is absurd," Stern said. "[The scarcity] is something promoted by oil industry. c9 They frighten people to get that price," said Professor John Boland, Stern's faculty adviser.
Stern moves further to argue that U.S. negligence in challenging the myth of oil scarcity has been adding to the volatility of the Middle East as the high profits come to fund terrorist activities and became a source of contention among countries in the region.
"Some of the problems would be solved," Stern said. "It's very hard to see that Iraq would have invaded Kuwait if it hadn't needed the Kuwati oil revenue to pay off its debts; it's hard to see why the civil war in Nigeria would be fought except for control of the oil revenues. c9 The gravest security problems of the world are tied to the price of oil," Stern said.
Stern argues that this cartel price can be broken by reducing American dependence on foreign oil through fuel taxes and emission standards.
According to Stern, demand reduction would be the most direct and predictable way to break the oil cartel's power and shatter the myth of the "oil weapon."
With the demise of this myth, Stern claims, a new era of U.S.-Middle East relations would begin, an era not focused solely on supporting regimes that provide oil.
What seems slightly remarkable about Stern's thesis is that no one can seem to prove it wrong. "I've read the blogs," said Boland.
"There are people who just deny that he isn't the first one to say this, or that it's just not accepted. But I can't think of any factual arguments that anyone's put up to prove he's wrong."
