How to Be ExxonMobil

Foreign Policy interviews Steve Coll about his new book Private Empire, which is about ExxonMobil's ongoing dominance. Coll explains the company's competitive strategy, which it relies on when competing against other companies for African contracts as well as with state-owned oil companies in the Middle East:

I also think that the way they win these deals in a place like Chad or Papua New Guinea or Angola is, in effect, they go to the host country and say: "Look, we recognize that you can deal with the Chinese, and you'll get soft loans and guns and things that you think are more valuable than what we can offer you, but what you'll also get is really lousy project management. You'll get less oil pumped, you'll get less royalties, you'll get less taxes, so you'll end up net poorer. Why not come work with us under our rule of law, under a really straightforward contract? And what our record shows is that you'll end up with more cash faster -- and then you can use that cash to buy whatever guns you want? But you'll have the money to carry out what ever plans you have; and we're reliable, we'll come in on time."

An Airline Buys an Oil Refinery; What Took Them So Long?

Fascinating article in today's Wall Street Journal, by Susan Carey and Angel Gonzelez: "Delta to Buy Refinery in Effort to Lower Jet-Fuel Costs." Coupled with the news of Microsoft bankrolling B&N's Nook business, the Delta deal shows how far and fast existing business models are shifting, and how vertical integration continues to not be dead.

Is The Fed Responsible for Higher Oil Prices?

Vincent R. Reinhart thinks so. Reinhart, an economist at the American Enterprise Institute and a former director of the Federal Reserve Board's Division of Monetary Affairs, argues that the Fed's quantitative easing program has raised the price of oil for American consumers:

Since the Fed firmly signaled in August its intent to launch the latest round of QE, oil prices have risen from $76 to around $100 per barrel.

Why does the Fed's balance sheet matter for oil prices? The producers of oil as well as other commodities typically sell their output in a worldwide market priced in U.S. dollars. Thus, they care about the current and expected future purchasing power of the dollar and how that will translate into goods and services back home. But QE has been associated with higher inflation and dollar depreciation, which combines to erode the purchasing power of the foreign producers of commodities. Thus, some of the rise in the nominal price of oil has been to catch up with that erosion.

Looking Back at the Gulf Horizon Spill

It's been almost a year since the Deepwater Horizon spill in the Gulf of Mexico, and more data is available on the magnitude of the spill. In a recent article, The New York Times describes the spill’s size as "some 4.9 million barrels of oil." That led me to two numerical musings.

First, I wanted to make the number meaningful by comparing it to another large, famous spill: the Exxon Valdez. Its size is imprinted in my memory as 11 million gallons, which is about 250,000 barrels. So the Deepwater spill was about 20 times larger than the Valdez. In retrospect, that makes sense. The Deepwater well reached into a geologic formation. Whereas the Valdez was merely what one could take from another formation and stuff even into a big ship.

Visualizing the Oil Spill

If the oil spill had happened in your town...

Where Oil Spills Happen All the Time

Oil spills in the Nigerian delta.

A Simple Solution to Oil Spills?

Hay and the cleanup effort.

Will the Gulf Oil Spill Be This Generation's Three Mile Island?

Is it the end for offshore drilling?

Will Brazil Binge on Oil?

Brazil, a longtime leader in developing alternative energy for its transportation sector and its electricity, has recently discovered a truly gigantic supply of oil under its ocean waters.

Buy an S.U.V., Save the Planet

Scientists and engineers are racing to develop technologies that will improve fuel economy and perhaps replace gasoline altogether. This is certainly to be applauded. But there may be an easier and more effective way to help wean ourselves off foreign oil and fight global warming. Interestingly, it involves not 21st-century technology but 28th-century technology -- as in 28th-century B.C.E.

What's better, it will enable us to shed the pounds with comparatively little diet or exercise. We can improve fuel economy not through the onerous task of developing next-generation lithium-ion batteries but simply by getting people behind the wheels of S.U.V.'s. How?