Geopolitical Peak Oil ?  

The New York Times has a report on "geopolitical peak oil" and the declining relevance of western oil majors - As Oil Giants Lose Influence, Supply Drops

Oil production has begun falling at all of the major Western oil companies, and they are finding it harder than ever to find new prospects even though they are awash in profits and eager to expand.

Part of the reason is political. From the Caspian Sea to South America, Western oil companies are being squeezed out of resource-rich provinces. They are being forced to renegotiate contracts on less-favorable terms and are fighting losing battles with assertive state-owned oil companies. And much of their production is in mature regions that are declining, like the North Sea.

The reality, experts say, is that the oil giants that once dominated the global market have lost much of their influence — and with it, their ability to increase supplies.

“This is an industry in crisis,” said Amy Myers Jaffe, the associate director of Rice University’s energy program in Houston. “It’s a crisis of leadership, a crisis of strategy and a crisis of what the future looks like for the supermajors,” a term often applied to the biggest oil companies. “They are like a deer caught in headlights. They know they have to move, but they can’t decide where to go.” ...

The new oil order has been emerging for a few decades.

As late as the 1970s, Western corporations controlled well over half of the world’s oil production. These companies — Exxon Mobil, BP, Royal Dutch Shell, Chevron, ConocoPhillips, Total of France and Eni of Italy — now produce just 13 percent. Today’s 10 largest holders of petroleum reserves are state-owned companies, like Russia’s Gazprom and Iran’s national oil company.

Sluggish supplies have prompted a cottage industry of doomsday predictions that the world’s oil production has reached a peak. But many energy experts say these “peak oil” theories are misplaced. They say the world is not running out of oil — rather, the companies that know the most about how to produce oil are running out of places to drill.

“There is still a lot of oil to develop out there, which is why we don’t call this geological peak oil, especially in places like Venezuela, Russia, Iran and Iraq,” said Arjun Murti, an energy analyst at Goldman Sachs. “What we have now is geopolitical peak oil.”

Reuters reports that there are some political manoeuvrings in Brazil over the profits likely to be obtained from Petrobras's offshore finds (when they are eventually developed) - Brazil's plans to control oil could cause delays. Note that Brazil may soon join OPEC.

The Brazilian government's plan to take greater control over huge new oil discoveries will face obstacles in Congress and could delay its ambitions to become a global oil player, experts said on Thursday.

President Luiz Inacio Lula da Silva wants to change the structure of oil control to give the government more funds for social welfare and education while reducing the power of state-owned oil firm Petrobras and its partners. "Some think that the oil is for Petrobras. The oil is for the union," Lula said on Thursday at an event in the Amazon state Para.

In neighboring Venezuela, President Hugo Chavez has tightened controls over oil to fund social projects. But in Brazil the plan could face a long battle in Congress. "The debate in Congress won't be easy, it's a debate over trillions (of dollars)," Ideli Salvatti, Senate leader for the ruling Workers' Party, told Reuters.

Petrobras shook the oil world last November when it discovered a deposit with estimated reserves of 5-8 billion barrels, the world's second-biggest find in 20 years. Other reserves thought to exist in the area could vault Brazil from 17th to 10th among world oil producers. The government has said it plans to join The Organization of Petroleum of the Exporting Countries (OPEC).