As mentioned before, capitalism itself is similar to an organism with a lifespan that consists of three distinct stages. For one, there is the “competitive” stage of capitalism. Second, there is the “imperialistic” stage of capitalism. And third, there is the “hegemonic” stage of capitalism. Thus, there is a “Periodization of Capitalism” that has to be reckoned with by both governments and societies. Currently, capitalism is in its third and final stage, known as the “hegemonic” stage and as manifested by American foreign policy and the rhetoric of Tony Blinken and Jake Sullivan and so forth. But as demonstrated by both Afghanistan and Iraq as well as the history of European colonialism, the hegemonic stage of capitalism is often met with a backlash in one way or another.
The latest backlash to the hegemonic dimension of capitalism is perhaps OPEC’s decision to slash natural gas and oil production today. What one often overlooks is that there are political and social dimensions to economic and financial activity. Thus, the slashing of natural gas and oil on the part of OPEC has to be seen within a broader context that is underpinned by political and social issues. Interestingly, and as Jeff Colgan wrote: “There is a tendency to take energy security either far too seriously, or not seriously enough.”
At this point in time, one could contend that energy security is not being taken seriously enough, as reflected by the lopsided American approach towards the Israeli-Arab issue, Russia, Iran, and Venezuela. In a sense, there is a “balance of power” element to the relationship between OPEC and the consumer nations of the West. And as has been argued before, the “balance of power” in this relationship has always been in favor of OPEC, but the ‘balance of power’ is now especially in favor of OPEC because of a broader context which encompasses political and social issues.
And in regards to the overall behavior and decision-making process of OPEC, Fereidun Fesharaki and David T. Isaak wrote:
“OPEC is not an organization [with a mission] despite its title. It is not a coherent hierarchy with a chain of command. Instead it is a grouping of heterogeneous nations bound together by oil. The mission of the ‘organization’ is to provide a meeting ground for the membership where differences can be ironed out. Mutual self-interest – both political and economic – is the glue. However, self- interest has a much broader definition within the developing nations as a whole, and within OPEC in particular, than the simple financial factors normally taken into account by economists.”
“This, we feel, is the key to the difficulty of most Western analysts, who often view sovereign OPEC nations as private enterprises and expect them to behave as such. When they do not, they are accused of either cartel behavior or irrationality.”
OPEC nations, after all, include governments which need to answer to their populations and constituents as well. Thus, not everything in the world revolves around the consumption, demand, and hubris of Western peoples. OPEC nations are not mere companies which pump out oil and natural gas for a mere profit motive. When these factors are taken into consideration, one might be able to understand the broader context and the broader explanation for individual instances of OPEC production cuts as the one we witnessed today as well as ones which might come in the future.