How will new global geopolitics effect oil and gas exploration?

The global political landscape has shifted significantly in recent years. With America's foreign policy taking them on a number of conquests to confront the world's enemies, Russia's fading power and China's emergence as one of the world's fastest growing economies, geopolitics have changed forever.

But in the light of changing political relationships between the world's most powerful and important nations, how will these changes affect the future of global oil and gas exploration?

Despite a huge amount of weight placed behind alternative sources of fuel over the last decade, the two fossil fuels still remain the world's most expensive commodities, and oil and gas exploration continues to be of great importance to the world.

Now, with commodity prices finally beginning to stabilise after a tough recession for the industry, the next challenge for the industry is the new era of geopolitical relations.
South America and the Gulf of Mexico

Oil and gas exploration in the Gulf of Mexico is a much contested topic with firms pulling out of the region - such as Devon Energy - US drilling policies looking ever more confused and much of it still open to auction from the world's biggest bidders, like Russia.

In South America, countries like Brazil and Venezuela have made moves that suggest a shift away from the United States as they look to increase self-sufficiency in the region. Once again, Russia has been involved as Moscow and Caracas have penned deals that look to further alienate the US.

There are many more areas which have changed the face of global oil and gas exploration, such as developments around the lucrative north west coast of Australia, and for the moment policies remain largely unchanged - drill when and where we can.

Although US foreign policy has made them unpopular with many nations, their oil and gas exploration exploits remain strong (even if that does not involve domestic exploration). Perhaps the biggest threat to exploration is not geopolitical relations but environmental red tape. But until renewable energy is at a stage where it can stand alone in meeting demands, oil and gas exploration will be vital to quenching the world's thirst.
Iraq and the West

Since the fall of Saddam Hussein as a result of the US-led invasion, Iraq has been crying out for foreign investment in its plentiful oilfields.

Now, finally, their efforts to lure some of the world's largest oil firms looks to be paying off. Iraq announced earlier this month that it had signed a huge oil deal, worth between 14 and US$20 billion, with UK oil giant BP and China's CNPC, in addition to another penned agreement with a consortium led by the Italian firm, ENI.

The Iraq Oil Ministry also announced recently that it is to award a consortium led by Exxon Mobil Corp. and Royal Dutch Shell PLC the right to develop the West Qurna-1 field in southern Iraq.

The geopolitical shift in this region has opened up fields for oil and gas exploration that have previously been closed to the developed world. But the future of exploration is far from secure as the region still remains unstable both economically and politically.