The Russian Oil Economy

The Russian Oil Economy

Jennifer I. Considine and William A. Kerr

In this unique work, Jennifer Considine and William Kerr contend that while OPEC currently dominates the international oil market, Russia will be a key player in the future international energy market. Indeed, Russia’s petroleum resources rival those of Saudi Arabia. More than almost any other industry, future performance is often determined by the influence of decisions made in the past. This book provides a detailed history of the development of the Russian oil economy in order to build up a comprehensive and discerning picture of its future role and significance in the global energy market of the 21st century.

Chapter 2: Risky Business – Oil in the Russian Empire

Jennifer I. Considine and William A. Kerr

Subjects: economics and finance, energy economics

Extract

2. Risky Business - Oil in the Russian Empire 2.1 ROTHSCHILD AND THE RUSSIAN NOBELITY Among the most promising markets for the ‘new light’ (kerosene) was the vast Russian empire, which was beginning to industrialise, and for which artificial light had a special importance. The capital city, St. Petersburg, was so far north that, in the winter, it had barely six hours of daylight. As early as 1862, American kerosene reached Russia, and in St. Petersburg, it quickly won acceptance, with kerosene lamps swiftly replacing the tallow on which the populace had almost entirely depended. The United States consul at St. Petersburg reported happily in December 1863 that it was ‘safe to calculate upon a large annual increase of the demand from the United States for several years to come.’ But his calculations could not take into account future developments in a distant and inaccessible part of the empire, which would not only foreclose the Russian market to American oil but would also spell the undoing of Rockefeller’s global plans. * The Russian crude oil industry had its modest beginning near the remote, and nearly inaccessible city of Baku,the territory of an independent duchy that had been annexed to the Russian Empire in the first years of the nineteenth century. Legends of the abundance of oil to be found on the Aspheron Peninsula - the landmass between the Caucasus Mountains and the Caspian Sea - date back to the end of the fourth Islamic century (the tenth century AD). Perpetual...

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