When looking up written material on the Russian oil and gas industry, you are (more often than not) likely to encounter clichés or exaggerations. Some would discuss chaos in wake of the collapse of the Soviet Union and the rise of the oligarchs as a typical “Russian” episode of corruption and greed – yet fail to address the underlying causes that led to it. Others would indulge in an all too familiar Russia bashing exercise without concrete articulation. Amidst a cacophony of mediocre analysis, academic Thane Gustafson’s splendid work – Wheel of Fortune: The Battle for Oil and Power in Russia – not only breaks the mould but smashes it to pieces. This weighty, arduously researched book of just under 700 pages split by 13 chapters does justice to the art of scrutiny when it comes to examining this complex oil and gas exporting jurisdiction; a rival of Saudi Arabia for the position of the world’s largest producer and exporter of oil.
It is about power, it is about money, it is about politics but turning page after page, you would realise Gustafson is subtly pointing out that it is a battle for Russia’s ‘crude’ soul. In order to substantiate his arguments, the book is full of views of commentators, maps, charts and tables and over 100 pages of footnotes. The narrative switches seamlessly from discussing historical facts to the choices Russia’s political classes and the country’s oil industry face in this day and age.
The complex relationship between state and industry, from the Yeltsin era to Putin’s rise is well documented and in some detail along with an analysis of what it means and where it could lead. In a book that the Oilholic perceives as the complete package on the subject, it is hard to pick favourite passages – but two chapters stood out in particular.
Early on in the narrative, Gustafson charts the birth of Russian oil majors Lukoil, Surgutneftegaz and Yukos (and the latter’s dismembering too). Late on in the book, the author examines Russia’s (current) accidental oil champion Rosneft. Both passages not only sum up the fortunes of Russian companies and how they have evolved (or in Yukos’ case faced corporate extinction) but also sum up prevailing attitudes within the Kremlin.
What’s more, as crude oil becomes harder and more expensive to extract and Russian production dwindles, Gustafson warns that the country’s current level of dependence on revenue from oil is unsustainable and that it simply must diversify.
Overall, the Oilholic is inclined to feel that this book is one of the most authoritative work on Russia and its oil industry, a well balanced critique with substantiated arguments and one which someone interested in geopolitics would appreciate as much as an enthusiast of energy economics.
This blogger is happy to recommend Wheel of Fortune to readers interested in Russia, the oil and gas business, geopolitics, economics, current affairs and last but certainly not the least – those seeking a general interest non-fiction book on a subject they haven’t visited before. As for the story seekers, given that it’s Russia, Gustafson has more that few tales to narrate all right, but fiction they aren’t. Fascinating and brilliantly written they most certainly are!
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