05 March 2009

GPPi publishes article on global energy governance in International Affairs

Jan Martin Witte, GPPi Associate Director and Andreas Goldthau, GPPi Fellow and Assistant Professor at Central European University, jointly published an article in the journal International Affairs, entitled “Back to the future or forward to the past? Strengthening markets and rules for effective global energy governance.”

The article argues that current public policy debates on energy security are characterized by a too narrow focus on questions regarding ‘access’ to resources and associated geopolitical and geo-economic challenges. This focus on the geopolitics of energy is rooted in the deep fears of consumers about security of supply, leading them to put strong pressure on policy-makers to come up with effective ‘fixes’. However, this lopsided attention to the geopolitical dimension of energy security is based on the myopic and erroneous presumption that global energy politics is necessarily a zero-sum game in which one country’s energy security is another’s lack thereof.

Witte and Goldthau argue that by zooming in on the security dimension of energy politics, this preoccupation deflects attention from the real issues that policy-makers should consider in their attempts to establish effective global energy governance: first, the central role played by increasingly international (in the case of oil, thoroughly global) energy markets in balancing demand and supply; second, and even more importantly, the significance of the ‘rules of the game’—national as well as international— that structure these markets. These ‘rules of the game’, that is to say the institutional architecture that underpins global energy, govern central aspects of financing, trading, and hedging oil and gas ventures via financial markets, investment treaties and trade agreements; and they address short-term supply risks in the event of market failure or disruption. In the article, Witte and Goldthau make a first attempt to apply such a broader perspective by identifying and analyzing the important role rules play in determining outcomes in international oil and gas markets; by examining how current trends are affecting the existing ‘rules of the game’; and by highlighting the consequences for public policy."

For more information about the article please visit: http://www.chathamhouse.org.uk/publications/ia/archive/view/-/id/2371/

For additional information, please contact Jan Martin Witte.

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