BRIC Energy Pact

By Keith Heyde

There are many assets a country can have. It may be endowed with precious metals, a highly innovative demographic, or a strategic location for world trade. However, one of the best assets in today’s modern age is the ability to access and harness energy.

With the rise of natural gas, and the shift away from a purely petrol driven infrastructure, there are new energy geo-political titans arising. And, leading the way in the natural gas world seems to be none other than our old neighbor, Russia.

Russia is a country unlike any other, not only in size, but also in politic climate. Today, President Putin was signed back in, to regain the Russian Presidency for a third time. Yet, Russia is not the same as it was when he was last in office (of the presidency) and the world’s energy climate is far different today as well.

Not only has there been a rapid technological shift away from conventional combustion engines in the last 5 years, but there have also been big developments in the supporting technological alternatives. Hybrid vehicles’ success has spurned the way for natural gas busses as well as electric vehicles to enter the market at a truly integrated level.

As such, Putin is in a position to pave the way for a new world order when it comes to energy. Due to the political truce between BRIC nations, Putin’s capacity to supply energy to the growing consuming power houses of India and China could result in a mutually beneficial reciprocity for both. By taking OPEC out of the equation as much as possible, and effectively isolating the thirsty giant that is the United States, the BRIC nations can align themselves in a position to grow in a new and most independent way.

Why does this matter?

Energy security is one of the dominant political forces when it comes to international politics. The ability to feed one’s industry almost directly corresponds to a country’s GDP and therefore economic strength. Without energy, it seems as though one cannot operate effectively. Thus, one of the most frequent ‘holds’ countries exhibit over one another is by threatening to cut off energy access. Whether through pipeline barring, excessive taxation, or overt war, energy access is crucial.

With the rise of new natural gas technologies, the BRIC nations have positioned themselves in a way such that they may be independent of the whims of the previous world order when it comes to energy politics. Brazil, already, is an impressively independent energy nation, relying off of biofuels and hydroelectric at an amazingly high percentage. In fact, Brazil is a net exporter when it comes to energy at a BTU level.

Russia, India and China, due to their proximity, could all benefit from similar infrastructure and NG development. To read more about this prospect, take a look at the recent Forbe’s magazine article: http://www.forbes.com/sites/matthewhulbert/2012/05/06/putins-bric-power-play-2/.

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