Those Who Control Oil and Water Will Control the World

History may not repeat itself, but, as Mark Twain observed, it can sometimes rhyme. The crises and conflicts of the past recur, recognisably similar even when altered by new conditions. At present, a race for the world's resources is underway that resembles the Great Game that was played in the decades leading up to the First World War. Now, as then, the most coveted prize is oil and the risk is that as the contest heats up it will not always be peaceful. But this is no simple rerun of the late 19th and early 20th centuries. Today, there are powerful new players and it is not only oil that is at stake.

It was Rudyard Kipling who brought the idea of the Great Game into the public mind in Kim, his cloak-and-dagger novel of espionage and imperial geopolitics in the time of the Raj. Then, the main players were Britain and Russia and the object of the game was control of central Asia's oil. Now, Britain hardly matters and India and China, which were subjugated countries during the last round of the game, have emerged as key players. The struggle is no longer focused mainly on central Asian oil. It stretches from the Persian Gulf to Africa, Latin America, even the polar caps, and it is also a struggle for water and depleting supplies of vital minerals. Above all, global warming is increasing the scarcity of natural resources. The Great Game that is afoot today is more intractable and more dangerous than the last.

The biggest new player in the game is China and it is there that the emerging pattern is clearest. China's rulers have staked everything on economic growth. Without improving living standards, there would be large-scale unrest, which could pose a threat to their power. Moreover, China is in the middle of the largest and fastest move from the countryside to the city in history, a process that cannot be stopped.

There is no alternative to continuing growth, but it comes with deadly side-effects. Overused in industry and agriculture, and under threat from the retreat of the Himalayan glaciers, water is becoming a non-renewable resource. Two-thirds of China's cities face shortages, while deserts are eating up arable land. Breakneck industrialisation is worsening this environmental breakdown, as many more power plants are being built and run on high-polluting coal that accelerates global warming. There is a vicious circle at work here and not only in China. Because ongoing growth requires massive inputs of energy and minerals, Chinese companies are scouring the world for supplies. The result is unstoppable rising demand for resources that are unalterably finite.

Although oil reserves may not have peaked in any literal sense, the days when conventional oil was cheap have gone forever. Countries are reacting by trying to secure the remaining reserves, not least those that are being opened up by climate change. Canada is building bases to counter Russian claims on the melting Arctic icecap, parts of which are also claimed by Norway, Denmark and the US. Britain is staking out claims on areas around the South Pole.

The scramble for energy is shaping many of the conflicts we can expect in the present century. The danger is not just another oil shock that impacts on industrial production, but a threat of famine. Without a drip feed of petroleum to highly mechanised farms, many of the food shelves in the supermarkets would be empty. Far from the world weaning itself off oil, it is more addicted to the stuff than ever. It is hardly surprising that powerful states are gearing up to seize their share.

This new round of the Great Game did not start yesterday. It began with the last big conflict of the 20th century, which was an oil war and nothing else. No one pretended the first Gulf War was fought to combat terrorism or spread democracy. As George Bush Snr and John Major admitted at the time, it was aimed at securing global oil supplies, pure and simple. Despite the denials of a less honest generation of politicians, there can be no doubt that controlling the country's oil was one of the objectives of the later invasion of Iraq.