Beginning in 2002, the "war on terror" began to hamper global oil supplies

[kuozzman]

http://www.atimes.com/atimes/Global_Economy/GA13Dj01.html

In cumulative terms, global oil demand increased by 12% between 1999 and 2004. Cumulative global oil supply increased by only 8.6% during the same period. Between 1999 and 2001, OPEC-engineered oil production cuts reduced global oil supplies relative to demand. Beginning in 2002, the "war on terror" also began to hamper global oil supplies.

The "war on terror" has contributed to destabilization in Syria, Yemen, Nigeria, Indonesia and Colombia, preventing foreign investment in oil production. As a result, oil production has declined in all of these countries since 2002. More broadly, the "war on terror" has significantly influenced the depreciation of the dollar in the past two years. The dollar's depreciation has also contained the growth of oil production.

The imports of most oil-exporting countries are dominated by Europe. Though the dollar price of oil has increased substantially in the past two years, the trade-weighted increase in the price of oil has been muted for oil producers in Europe, Africa and the Middle East. Because of this, the dollar's depreciation against the euro has also contained investment in oil production in many countries.

The "war on terror" has crippled US foreign relations with key oil producing countries, including Russia and Venezuela. Deteriorating relations with Washington have encouraged these countries to contain oil production growth in order to push international oil prices higher. The "war on terror" has made investment in oil production unusually unresponsive to sharply higher international oil prices.