WHEEL OF FORTUNE

Peak oil’s not just a capitalist conspiracy, and Vladimir Putin is vexed and peeved.

When the Soviet Union collapsed in 1991, writes Gustafson (Government/Georgetown Univ.; Capitalism Russian-Style, 1999, etc.), the Soviet oil system went with it. In the 1980s, it was the world’s leading producer of oil, but a decade later, production had fallen by half. Oil shored up the system, and by Gustafson’s lights, it made Putin what he is today: Formerly a shabby bureaucrat, once fed a constant diet of oil rubles, his “standard of living clearly improved, even before he became president.” Yet Putin is not the guarantor of a system under which capitalist Russia’s new rich can safely continue to collect billions, for Putin seems to view oil as a means to an end, that end being a well-funded military. “His basic view,” writes the author, “that revenues from oil should be channeled by the state to support Russia’s other strategic industries, remains essentially unchanged from those views he first expressed in the 1990s when he first came to power.” Gustafson notes that the Russian oil economy is at a crossroads, with no clear signal ahead. It might well revert to state control, or it might become a free-market leader, though the likelihood seems to tend in the direction of the former. What seems more certain is that the glory days have passed, since there’s a rule of thumb in oil that the biggest and richest fields have likely been discovered and since production seems destined to dwindle, barring fantastic discoveries in the ever-more-accessible Arctic.

A useful, readable primer in a specialized but strategically important corner of geopolitics.