I have often wondered how oil producing countries would react to lost oil exports if other countries ever begin to take serious action to shift to renewable energy. So far, very little has been done in this regard, so it has not been a big issue. But it does seem possible that we are on the verge of effective measures being taken. What will the big oil producers do in response? The NY Times reports on one possibility:
Saudi Arabia is trying to enlist other oil-producing countries to support a provocative idea: if wealthy countries reduce their oil consumption to combat global warming, they should pay compensation to oil producers.
The oil-rich kingdom has pushed this position for years in earlier climate-treaty negotiations. While it has not succeeded, its efforts have sometimes delayed or disrupted discussions. The kingdom is once again gearing up to take a hard line on the issue at international negotiations scheduled for Copenhagen in December.
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“Assisting us as oil-exporting countries in achieving economic diversification is very crucial for us through foreign direct investments, technology transfer, insurance and funding,” Mr. Sabban said in an e-mail message.
This Saudi position has emerged periodically as a source of dispute since the earliest global climate talks, in Rio de Janeiro in 1992. It is surfacing again as Saudi Arabia tries to build a coalition of producers to extract concessions in Copenhagen.
How this will play as a negotiating position is somewhat beyond me, although it seems like a stretch. More here from Dan Drezner on that.
But I do wonder whether there is some long-shot trade complaint in there somewhere, perhaps some kind of "non-violation" or "situation" complaint under GATT Article XXIII:(1)(b) or (c). The basic argument would be along the lines of, "we negotiated all of these tariff concessions on oil products, but then everyone took action to stop using these products, thereby undermining the benefits of the concessions." Definitely a long shot, but someone might try it in desperation.
