Now the we know who the losers are, it's time to see the winners - and unsurprisingly the answer is the countries of the Arabian Peninsla and Russia helping the rise of Russia.
The big losers are countries that not only have to import oil but
also are heavily industrialized relative to their economy. Countries in
which service makes up a larger sector than manufacturing obviously use
less oil for critical economic functions than do countries that are
heavily manufacturing-oriented. Certainly, consumers in countries such
as the United States are hurt by rising prices. And these countries’
economies might slow. But higher oil prices simply do not have the same
impact that they do on countries that both are primarily
manufacturing-oriented and have a consumer base driving cars.
East Asia has been most affected by the combination of sustained
high oil prices and disruptions in the food supply. Japan, which
imports all of its oil and remains heavily industrialized (along with
South Korea), is obviously affected. But the most immediately affected
is China, where shortages of diesel fuel have been reported. China’s
miracle — rapid industrialization — has now met its Achilles’ heel:
high energy prices.
The Chinese dilemma is present throughout Asia. But just as Asia is the
big loser because of long-term high oil prices coupled with food
disruptions, Russia is the big winner. Russia is an exporter of natural
gas and oil. It also could be a massive exporter of grains if prices
were attractive enough and if it had the infrastructure (crop failures
in Russia are a thing of the past). Russia has been very careful, under
Vladimir Putin, not to assume that energy prices will remain high and
has taken advantage of high prices to accumulate substantial foreign
currency reserves. That puts them in a doubly-strong position.
Economically, they are becoming major players in global acquisitions.
Politically, countries that have become dependent on Russian energy
exports — and this includes a good part of Europe — are vulnerable,
precisely because the Russians are in a surplus-cash position. They
could tweak energy availability, hurting the Europeans badly, if they
chose. They will not need to. The Europeans, aware of what could
happen, will tread lightly in order to ensure that it doesn’t happen.