International crises, such as the revolution taking place in Libya or the earthquake disaster in Japan, produce many inevitable changes in terms of the energy industry, given the centrality of energy in public life. Some of these changes are short term, while others have long-term implications. In Libya, for instance, preliminary information indicates that wide scale devastation has taken place, in the course of the hit-and-run battles between government forces and rebels, in the oil installations in coastal cities, such as the port cities of Brega and Ras Lanuf. The damaged installations are not expected to be repaired or replaced in the near future, something that will reduce Libya's export capacity for a considerable period of time. Libyan oil exports are also expected to be hit by U.S. and European sanctions imposed on the country, in addition to those mentioned in UN Security Council resolution 1973, which proscribe dealing with the Libyan National Oil Corporation and its subsidiaries (the United States blacklisted the corporation and 14 of its subsidiaries.). Strangely, however, the U.S. sanctions encompassed the Arabian Gulf Oil Company (Agoco), a subsidiary of the National Oil Corporation based in Benghazi, even though the company had announced it has split from the parent company and declared its allegiance to the National Transitional Council (NTC). The company had also declared itself in charge of all oil operations in the areas controlled by the rebels. It is worth noting that UNSC resolution 1973 had recognized the NTC in Benghazi. Alternatively, Qatar has signed an agreement with the NTC to market oil produced from the areas it controls, despite the American boycott of Agoco and Doha's multifaceted petroleum interests with Washington. The volume of oil that can be exported from rebel positions is estimated at nearly 130 thousand barrels per day, and may reach up to 300 thousand barrels per day, depending on the conditions of the facilities controlled by the rebels, since the locations actually held by them keep switching hands in the hit-and-run battles. The export volume also depends on whether shipping companies accept or refuse to send vessels to the ports in question, because of the battles raging in or around them, and on obtaining marine insurance policies and also the cost of their premiums. It is very likely that the Qatari authorities have discussed the issue with the U.S. authorities concerned, before signing the agreement with the NTC. Nevertheless, the details of this detail remain as of yet unknown. For their part, the Libyan authorities announced that they will sue international companies that purchase oil from the rebels. But on the other hand, governmental Libyan oil exports are expected to fall to extremely low levels, or to grind to a halt, because of the U.S. embargo, as international oil companies become wary of U.S. sanctions. Most of these companies have branches or operations in the United States, or financial ties with U.S. banks, which may all be adversely affected should these companies buy or market ‘governmental' Libyan oil. This means that funds will become gradually scarcer for the officials in Tripoli. The shortage of Libyan exports (about 1.5 million barrels a day before the revolution) will leave its mark on global markets, despite the availability of surplus production capacity in Saudi Arabia, the UAE and Kuwait, of about six million barrels per day that could be used to offset this shortage. The reason for this is the continued revolutions, uprisings and unrest in the Middle East, and the possibility that these may last for a significant period of time. So far, international reactions to these events are not clear. The recent Arab uprisings have undone the U.S. War on Terror, and have taken the region to a completely novel political state of affairs. The above is also valid in light of the likelihood that sharp political conflicts will continue in certain countries, be they oil producing nations or not, wherein their leaders are insisting on remaining in power and not committing to actual or convincing reforms. Finally, because of the quality of the light, sweet and low-sulfur Libyan crude oil, it is difficult for it to be replaced in sufficient quantities over a long period of time. As regards the tragedy in Japan, the impact is much more far reaching than the Libyan crisis, due to the sheer magnitude of the losses suffered by the country, which has the world's second largest industrialized economy. Nuclear meltdown in the Fukushima reactors will force Japan to conduct an extensive long-term reassessment of its energy policies. This reassessment will be more comprehensive than the one carried out in the aftermath of the Chernobyl nuclear disaster in Ukraine in 1986, where Japan decided, in light of popular pressure, not to construct new reactors, to extend the service life of existing ones. Hence, the Tokyo Electric Power Company (TEPCO), one of the world's largest electric companies, decided to extend the service life of Reactor No. 1 at the Fukushima plant, which was built in 1971, for 40 additional years. Afterwards, several Japanese companies tried to also extend the service life of their reactors by 60 more years, to avoid political pitfalls and popular pressures that would ensue from constructing new reactors. This is not to mention the high cost of building reactors and frequent delays in their construction. However, the Japanese government refused to allow these extensions. Now, because of overwhelming public backlash in Japan over the disaster that has struck, and because of the inaccuracy of the information disclosed by the government in the beginning, undermining the credibility of the recent statements, it will be extremely difficult, if not altogether impossible, to obtain government approval for the construction of new reactors in the foreseeable future. This means that Japan, in order to press ahead with its pollution control policies, would be forced to use natural gas instead, aided in this by the high surplus natural gas production capacity of Qatar, Russia and Australia. This is while bearing in mind that natural gas is an intermediary type of fuel, and is abundant. The reassessment of energy policies in major industrialized countries has already begun, for instance in Germany and the United States. The purpose of the reassessment is to determine the extent on the reliance on nuclear energy in power generation. It is unlikely that oil will be used to replace nuclear energy, however, for two main reasons, namely, that petroleum products have not been used in power plants for many years now, and because of the widespread hostility to any further expansion of oil usage. *. Mr. Khadduri is an energy expert
