Enforcing Scarcity: Oil, Violence, and the Making of the Market

Abstract

Oil has always been at the center of discussions of resource scarcity. Over the last decade of volatile and often rising oil prices, a vast “peak oil” literature has emerged citing the geological finitude of petroleum as a harbinger of an era of catastrophic energy scarcity. Many analysts focused on the geopolitics of oil also presume that natural oil scarcity is the primary driver of global conflict and “resource wars.” In contrast, I follow geographical discussions of the social production of scarcity, to problematize oil scarcity as not a geological fact but as a social relationship mediated by capitalist commodity relations. Specifically, I focus on the role of violence in socially producing the scarcity necessary for the oil market to function. I first discuss the broader historical and legal problems of “overproduction” in the United States. I then examine the 1931 declaration of “martial law” in the oil fields of east Texas and Oklahoma in a moment of lax depression-era demand, glut, and collapsing oil prices. I argue that violently imposing oil scarcity was not merely sectoral but a broader project of stabilizing the chaotic oil market in accordance with the reorganization of capitalism during the 1930s. Such stabilization was critical for the emergence of an oil-powered Fordism in the postwar United States responsible for the intractable patterns of oil demand so vexing to energy policymakers today. I conclude by suggesting that contemporary debates on petro-imperialism might consider questioning the role of violence not as a product but as a generator of scarcity.

El petróleo ha estado siempre en el centro de las discusiones sobre escasez de recursos. Durante la pasada década, caracterizada por precios volátiles y a menudo en aumento, apareció una literatura del “pico del petróleo” que cita lo finito de la vigencia geológica de este hidrocarburo, como un presagio de una era de catastrófica escasez de energía. También, muchos analistas enfocados en la geopolítica del petróleo presumen que la escasez natural de este combustible es el principal motor de conflicto global y de “las guerras de los recursos”. En contraste, yo sigo las discusiones geográficas sobre la producción social de escasez, para problematizar la escasez de petróleo no como un hecho geológico sino como relación social mediada por relaciones mercantiles capitalistas. Específicamente, me concentro en el papel de la violencia para producir socialmente la escasez necesaria para que el mercado del petróleo funcione. Primero discuto los más amplios problemas históricos y legales de “superproducción” en Estados Unidos. Luego examino la declaración de “ley marcial” de 1931 en los campos petroleros del oriente de Texas y Oklahoma en un momento de floja demanda asociada a la era de la depresión, la saturación y colapso de precios del crudo. Argumento que el imponer con violencia la escasez de petróleo no fue meramente sectorial sino un proyecto de mayor alcance para estabilizar el caótico mercado del petróleo, de acuerdo con la reorganización del capitalismo durante los años 1930. Tal estabilización era crítica para la emergencia de un Fordismo propulsado por petróleo en los Estados Unidos de la posguerra, responsables de los patrones inmanejables de la demanda de petróleo, tan irritantes para quienes orientan las políticas petroleras de nuestros días. Concluyo sugiriendo que los debates contemporáneos sobre petro-imperialismo podrían considerar poner en picota la discusión del papel de la violencia no como un producto sino el generador de la escasez.

Keywords:

• energy history
• oil
• scarcity

关键词:

• 能源的历史
• 油
• 稀缺

Palabras clave:

• historia de la energía
• petróleo
• escasez

Acknowledgments

The author is gratful to the Franklin D. Roosevelt Presidential Library for their support of this research. He would also like to thank Karl Zimmerer for his editorial guidance and Jody Emel, Deborah Martin, Dick Peet, James McCarthy, Jesse Goldstein, George Caffentzis, and three anonymous reviewers for helpful comments on various iterations of this article (the usual disclaimers apply).

Notes

1. The most prominent being Yergin and the Cambridge Energy Research Associates, who believe in the power of high oil prices to spur technical innovation and increased production capacity (e.g., Jackson 2009).

2. Texas and later Saudi Arabia were famous as “swing producers” who could increase production at any moment. Most estimate that Iraq is currently producing at only about 20 percent of present capacity (Walt 2009).

3. Many suggest that the United States has reached peak oil demand (e.g., Jackson 2009).

4. This is complicated with the emergence of so many state-run national oil companies, but even most of these “public” enterprises operate with a profit orientation (Mommer 2002: Labban 2008).

5. For example, Exxon/Mobil's recent $4.1 billion for a field off the coast of Ghana (Mouawad and Kouwe 2009).

6. This case study is just that. Space precludes a more general examination of the wider relations among oil, violence, and U.S. policy over the last century.

7. Similar problems beset groundwater property regimes (Emel, Roberts, and Sauri 1992).

8. A process described in the 2007 film, There Will Be Blood, as drinking your milkshake. This phrase, “I drink your milkshake,” has become infused into pop culture, inspiring T-shirts and Web sites.

9. The term independent usually refers to oil producers, refiners, or marketing outlets that were nonintegrated and did not, like “major companies,” control oil from the production well to the gasoline station (Olien and Hinton 2007, 1–11).

10. The importance of oil in fueling war was made abundantly clear during World War I but was emphasized even more during World War II.

11. It should be noted that California—a major oil producer—was a somewhat separate concern, as Californian oil was largely consumed within the western part of the United States (Sabin 2005).

12. OPEC has never replicated the kind of market stability enjoyed by the United States during the postwar period.

13. Depending on whether or not the vast Tar Sands of Alberta are included in Canada's reserve figures.