U.S. has few options as oil nations tighten grip

WASHINGTON (Reuters) – Resource nationalism in oil producing countries is cordoning off valuable supplies and the United States has precious few options to battle the trend amid a looming supply crunch.

As oil prices marched above $135 a barrel last month — and hit a record $137.79 on Friday — international firms have found themselves faced with tougher terms and shut out of the globe’s most promising oil basins, a trend known as “resource nationalism.”

The United States — the world’s biggest oil consumer — stands mostly powerless as national oil companies like Venezuela’s PDVSA and Russia’s Gazprom block access to key oil reserves and demand a larger share of the profits in exchange for allowing international oil companies to drill.

“There are few good foreign policy options because oil really is our economic jugular,” said Anne Korin, co-director of the Institute for the Analysis of Global Security, a nonprofit energy think tank.

Reuters