Geopolitical Risk + Energy Transition + Climate Change = The Trifecta
BLUF Energy is designated as a “lifeline” sector by the US government because of its fundamental importance to economic activities, essential services and daily life. Why does this matter? Over 80% of US energy infrastructure is privately owned. Energy companies must acknowledge the rising geopolitical risks and take steps…
BLUF Democracy index scores are a useful tool for gauging geopolitical risk associated with doing business in specific countries. Engagement in friend-shoring democracies rather than adversarial autocracies can reduce geopolitical risk. Why does this matter? As energy companies grapple with new geopolitical risks, mitigation strategies can be challenging. Leveraging…
BLUF Stable seaborne energy trade would be at risk without the laws and frameworks established by the rules-based international order. The largest energy importers and exporters from 2022 were vital to stability and prosperity (see map). Their global reach reinforces the need to maintain stable sea lanes. Why does…
BLUF Friend-shoring countries identified in the National Defense Industrial Strategy (NDIS) are 97% democratic and represent 48% of world democracies, according to the Economist Intelligence Unit’s (EIU) 2023 Democracy Index. The friend-shoring list did not include any authoritarian regimes. Why does this matter? Friend-shoring reduces geopolitical risk for energy…
BLUF Concepts introduced and amplified in the National Defense Industrial Strategy (NDIS) offer helpful frameworks for energy companies to reduce geopolitical risk. Adversarial capital, production diplomacy and friend-shoring each reflect a relevant attribute of the current global geopolitical situation. Why does this matter? The NDIS repeatedly illuminated how and why…
BLUF A coalition of countries must cooperate to enforce international law and protect at-risk global shipping. Examples already exist to do this, which may be leveraged if needed in a contested South China Sea or an ice-free Arctic. Members and observers of the Arctic Council and Barents Euro-Arctic Council…
BLUF Usually, we talk about ships transiting through the Panama Canal. But a robust ecosystem of multimodal transshipment options explodes from the area around the canal, making this 50-mile (80 km) strip of land even more strategically important than many realize. The Panama Neutrality Treaty helps maintain the status quo.…
BLUF The importance of the NDIS lies as much in its existence and articulation as it does the content and priorities outlined. By acknowledging the multidimensional problems and envisioning solution sets, the US government transparently signaled to industry, allies, and partners the essential nature of their collaboration. Why does…
BLUF Panama Canal’s port concessionaire is 80% owned by a Hong Kong company with ties to the PRC for decades. Law #5 gives the concessionaire significant authority that puts the port’s neutrality at risk. The geopolitical risk presented by PRC’s ability to exert significant influence over Panama Canal operations…
BLUF Korea, Japan, and China are the #1, #2 and #5 largest importers of US LNG. Ensuring Korea’s reliable supply of US LNG is critical to the country’s energy security. Japan and China are less reliant on US LNG. Why does this matter? All points of exit for US…
