Oil in the Middle East

The chapter The Political Economy of Middle Eastern Oil written by Mary Ann Tetreault is focused on the issue concerning the transportation, development, improvement of the oil industry and controversial nature of the Middle East conflicts over the oil and natural gas sources.Advertising We will write a custom essay sample on Oil in the Middle East specifically for you for only $16.05 $11/page Learn More The author of the chapter claims that the hydrocarbons can be considered as the benefit and failure for countries that export oil. To get deeper involved in the issue and understand the significance of the oil industry for the Middle East the author takes a closer attention to the following aspects, namely the structure and the system of the oil industry, the politics in oil’s political economy, the oil revolution, and oil politics in the Middle East. Mary Ann Tetreault points out the causes of the Iraq war and the connection between money and oil in the Middle East countries. According to the information provided in the chapter, the country that has mineral sources dictates the rules and establishes the access regulation (Schwedler, 2013, p. 261). The oil industry used to be monopolized; however, when the organization has a high level of the profit, new competitors appear on the market and cause the profit reduction. The oil price is significantly connected to the amount of extracted oil as the overproduction causes the decrease in price (Jones, 2012, p. 209). The creation of the Organization of the Petroleum Exporting Countries aimed to control the oil price and stabilize the situation with the oil and gas extraction. The ownership of the oil faced dramatic changes after the oil revolution; however, it should be stated that the great majority of experts argues the decisions made by IOC, stressing that the main concern was to collect taxes (Schwedler, 2013, p. 268). The consequences of the oil revolution were the following, namely the real cost for the crude oil and the impressive level of the profit. The high prices on oil made this industry involved in politics and cause a lot of misunderstandings and confrontations between the OPEC countries (Schwedler, 2013, p. 270). The revolution in Iran contributed to the development of the conflict based on oil price and the way the industry should be organized. The war between Iraq and Iran over the oil exporting caused the inability of the OPEC to minimize the drawbacks of the price system. Struggling with the challenges within the organization, the countries of the Middle East let the Soviet Union to enter the market.Advertising Looking for essay on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More It should be pointed out that the race for the geopolitical domination using the oil as the tool of influence was not beneficial for the countries of the Middle East and the Soviet Union as well. The eff orts put in the conflict did not result in the achievement of the goals. The oil industry provided the countries with the false power and was the reason for numerous victims of the military conflicts and political confrontations. In conclusion, it should be stated that the oil industry allowed the countries of the Middle East to become economically independent and receive a chance to substitute the military approach with the economic influence. The question concerning whether the oil industry is beneficial or not to the countries of the Middle East seems to be unanswered. Although, the industry offers a lot of possibilities to the countries, it caused political, social, and economic strife. References Jones, T. (2012). America, Oil, and War in the Middle East. Journal of American History, 99(1), 208-218. Schwedler, J. (2013). Understanding the Contemporary Middle East (4th ed.). Boulder, CO: Lynne Rienner. This essay on Oil in the Middle East was written and submitted by user Juliet E. to help you with your own studies. You are free to use it for research and reference purposes in order to write your own paper; however, you must cite it accordingly. You can donate your paper here.