This isn't just the worst ever energy crisis in history. What we are witnessing is nothing less than the First Energy World War. No country - well, almost - is left unaffected. Energy superpower Saudi Arabia is in the deepest economic and geopolitical pain ever. Even Norway - far away, super rich and the key supplier of energy to Western Europe - is in crisis. Because soaring petrol and electricity prices are hurting the ordinary people in the scenic kingdom. In the Global South, the poor are being told to go back to kerosene for cooking. In India, too, kerosene is re-entering many kitchens.
Israel is relentless in its long-cherished plan to demolish Iran, which it has deemed an existential threat for decades. The United States has long refrained from being militarily involved in any such Israeli adventure. However, Israeli Prime Minister Benjamin Netanyahu, after two decades of persistent scheming, finally had his way in dragging the US into his biggest ever war project. The US is now not only trapped but is forced to lead one of the fiercest external aggressions against one of the oldest living civilisations on the planet, Iran.
America's vulnerabilities and weaknesses are for the entire world to see. Qatar's Ras Laffan LNG got bombed by Iran. The US, despite its big military base there, could not protect the tiny kingdom's economic lifeline. The stories from the UAE, Saudi Arabia, Kuwait and other hydrocarbon-rich kingdoms in the Gulf are similar. They depended on the US for their defence. But they have never felt more defenceless. There is now a growing realisation that the United States may no longer be the force it used to be, that it is now a rapidly declining power, and that they need to rework the way they have looked at its defence frameworks all these years.
Hence, hush-hush parleys have begun all across the Gulf Kingdoms to rethink their security architecture. Many have begun to look at India, China, Europe and Japan with a fresh lens. The Middle East, or West Asia as we prefer to call it, will never be the same again.
The UAE, Qatar, or, for that matter, even Saudi Arabia, have begun to play the role of new catalysts - ones with the potential to transform and modernise the entire region and, even beyond - for all Muslim societies across the world. A New Middle East in this scenario would be less dependent on the US and would actively seek deeper energy and security engagements with emerging powers like India. China would also be there, probably bigger and deeper than ever before, but to believe that it would replace the US in the region is a misplaced belief. Most Arab countries do not trust China enough to engage with it exclusively in matters like security. The New Middle East will most likely follow an India-like policy of multi-alignment and multipolarity.
Would the New Middle East also open up new opportunities for India in terms of securing oil and gas and reconstruction opportunities? Absolutely, yes. However, our approach should be building interdependence, not just buying oil and gas from there. India must insist on buying stakes in producing oil and gas assets in the region, including in post-war Iran. India should also insist on higher FDI by energy-exporting Gulf countries in the country, especially in oil and gas exploration and production, oil and gas strategic and commercial storage, and oil, LNG and LPG shipbuildings in the country.
This would also be the time for India to push ahead with the India-Middle East Economic Corridor (IMEC) and look at it in the context of the inevitable new security architecture of the region. Such a framework would be more multinational and collaborative, with the US still playing a big role but also vacating space for other powers, including the likes of France and Germany. India should support any such new architecture that does not let China mushroom in the region.
However, the immediate challenge is how to deal with the escalating energy war. We should be prepared for a $150-per-barrel scenario if the US moves into Iran's oil export hub, the Kharg Island. The world is already witnessing some destruction in the demand for oil due mainly to the disruption in supply, but also due to many travellers and some industries putting their plans on hold. Multiple factors, triggered by the energy world war, have built-in market mechanisms to stop oil prices from going wild - such as the $200-per-barrel figure being touted by market experts currently. But a war is a war, and it is never predictable. Especially if it is piloted by one country - read Israel - and fought largely by another - the US - however reluctantly.
(Narendra Taneja is a globally reputed thought leader in energy policy and geopolitics)
Disclaimer: These are the personal opinions of the author
