Last Updated September 5, 2023.
The History of Oil
The Prize is a condensed yet detailed history of how crude oil became an important global commodity. It chronicles the first discovery of oil and, more importantly, the development of the process for refining oil to be used as engine fuel. The book also traces the history of boomtowns in the United States and in other countries. In a sense, the history of oil runs parallel to the history of global economics, because oil became a vital commodity during the Industrial Revolution. By examining the history of oil, Yergin is able to present why there have been numerous conflicts over this valuable resource.
Oil and Geopolitics
Oil and geopolitics have always been linked together, especially after the discovery of oil in countries like Saudi Arabia, Kuwait, and Venezuela. The geopolitics associated with oil production and distribution is well documented and has been extensively covered in the media, particularly during the two Iraq operations under US presidents George H. W. Bush and George W. Bush, respectively. Conflict and commodity have become intertwined throughout the history of oil, and Yergin cites numerous examples throughout the book. Like other valuable commodities throughout human history—such as gold, steel, and diamonds—crude oil has caused political tensions and outright war among nations. Oil, however, is arguably the most vital of these natural resources, because oil is refined as fuel, which is vital to global economics (e.g., as fuel for airplanes, cargo ships, automobiles, delivery trucks, etc.). Its importance has shaped the modern-day geopolitical climate, especially in the Middle East, parts of South America, and even Eastern Europe, where pipeline routes have caused conflicts.
The Value of Oil
Over the last few decades, oil has become a form of currency, called petrocurrency. Oil-producing nations have the ability to trade their oil surplus, and the attainment of oil-rich territories has led to political and military conflicts involving various nations, such as the United States, Russia, Iraq, and Kuwait, among others. Oil has become one of the world's most valuable commodities due to the extreme nature of our dependence on it, which is directly linked to the auto-manufacturing and energy industries. Yergin traces not only how oil became so valuable, but how dependence on oil has shaped present-day global economics.