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International Resource Politics 101: Blessing Or Curse?


International Resource Politics is characterized by three terms: International Relations, Geopolitics, and Resources. It explains the influence of natural resources, particularly energy, on state behavior and international politics. Resources have a tremendous impact on the world stage as resource-rich states have power over obtaining, securing, and limiting access to their energy assets, hence shaping interstate relations. Taking into account the three terms formerly mentioned, this series of articles explains the geopolitical advantages and disadvantages provided, namely, by energy while focusing on the development of resources as economic engines and their role in various political events that occurred in the late 19th century up to present times.

The International Resource Politics 101 series is divided into six chapters:

International Resource Politics 101: Blessing Or Curse?

The world's most plentiful and ubiquitous energy sources are fossil fuels (Gross, 2020). Fossil fuels continue to be essential for supplying the globe with energy despite increased production and use of environmentally favorable renewable alternatives (BP Statistics, 2022). About 80% of our energy demands are still met by oil, coal, and gas in 2021 (BP statistics, 2022); it is used to generate energy for heating at home, electricity through a massive power plant, and power through engines (Gross, 2020). While it possesses several benefits, according to NASA Global Climate Change (NGCC) (2021), greenhouse gases, are released into the atmosphere in massive quantities while fossil fuels are burned. This has eventually caused a warming global temperature, and many other associated dangers such as increased sea level rise, harsh weather, biodiversity loss, species extinction, food scarcity, deteriorating health, and increased poverty (NGCC, 2021).

Counting back from the 2010s, six of the ten most pricey extreme weather events in the United States have happened, causing damages totaling over $411 billion (adjusted to the inflation) (Center for Climate and Energy Solutions, 2022). As a result, the United Nations (UN) is coordinating an international approach to what has been referred to as the "climate emergency" under the auspices of the UNFCCC (United Nations Framework Convention on Climate Change) and in coordination with the IPCC (Intergovernmental Panel on Climate Change) (2022). The UNFCCC organizes a Conference of Parties (COPs) that brings all states together to evaluate data, define objectives, and make important decisions regarding green recovery. COP21, which took place in Paris in 2015, is undoubtedly the most crucial of these as the Paris agreement has been adopted (Dettmer, 2021). At COP21, nations set voluntary emissions targets (also known as Nationally Determined Contributions, or NDCs), which would constrain climate change to a maximum of 2 degrees above pre-industrial levels by 2050, with a stretch goal of 1.5 degrees (Dettmer, 2021). Despite the ambitious plan, it does not seem to contribute to a significant change in decreasing emissions. One may wonder why acknowledging the consequences of using fossil fuels, state nations find it difficult to drastically change their energy policies and accelerate green energy. Having seen the curse the energy resources created, this article will further discuss the challenges in the transition to renewable energies and the new opportunities that emerge from its shift.

Figure 1: Oil, coal, and gas serve about 80 percent of our energy needs.

The first challenge is an unexpected circumstance. The European Union (EU) entered the Paris Agreement in 2016, showing the commitment to maintain world average temperature to well below 2°C above pre-industrial levels, with a short-term target of 1.5°C (European Commission (EC), 2022). According to Eurostat, between 1990 and 2020, greenhouse gas emissions in the EU decreased by 32% across a variety of industries, including manufacturing and energy. As a result of implementing national and EU energy policies, enhancing the use of renewable energy sources, and switching from coal to gas for power generation, the EU has been able to reduce its greenhouse gas emissions (European Environment Agency, 2022). Indeed, it represents the level of EU states contributed to fighting climate change. However, the plans are drastically changing in the wake of the war in Ukraine. European nations including Germany, Austria, France, and the Netherlands have chosen to partially halt the "Europe beyond coal" campaign, part of the EU Green Deal, and restore some closed coal-fired power facilities to address the energy issue (Schonhardt, 2022). Although, the greater penetration of clean energy into the EU economy has been an always priority and a plan was to get rid of coal-firing plants, the energy crisis is requiring a short-term solution.

A second challenge, growing economies will take longer to switch to clean energy sources if developed economies do not cooperate and encourage them (Oxford Institute for Energy Studies (OIES), 2021, p.19). According to OIES, in terms of their economic growth, present energy mix, and carbon emissions, several countries and regions are starting from varying situations. If relative to the EU and North America the energy transition to a renewable source of energies would be easier, regions known as the Middle East, CIS, and Asia commence from a point where one or two fuels are more dominant (OIES, 2021). The author Sarthak Sharma from the Center for Strategic and International Studies (2022) highlights that in the majority of developing nations, investments in renewable energy are not keeping pace with rising CO2 release. There is little evidence that these nations are consuming less coal even as their need for energy is rising due to urbanization, industrialization, economic expansion, and population growth. For nations that demand dependable pumped storage power and have little ability to handle the intermittent nature of renewables, coal continues to be an affordable addition to electrical systems (Sharma, 2022).

Figure 2: Adoption of the Paris Agreement during COP21

Third, according to OIES, the financial burden is a pertinent factor that is generated by investments in new technology and the restructuring of the energy system (2021). The IEA forecasts that within the next ten years, $1-1.3 trillion will require to be invested annually in the power sector (primarily in renewable energy and power networks), also up to $1 trillion annually in optimizing energy use in end-use segments (Mathis, 2022). In addition, $0.6-0.8 trillion will still need to be spent on conventional fuels like oil and gas to ensure a controlled decline in traditional so-called fossil fuel use. OIES researchers state that the pace of the energy transition will be significantly influenced by how willing banks and other financial institutions are to accept the combined risk of funding innovative technologies while simultaneously giving in to demand from investors and society to stop financing hydrocarbons (2021).

Despite some barriers, also known as the current challenges mentioned above, the development of green energy leads to discoveries that might be a blessing. There are many advantages offered by renewable energy. Crucially, one of the key factors influencing the rising demand for clean energy is the reduction of global warming (Sen & Ganguly, 2016). Since renewable energy sources known as sun, wind, water, waste, and heat from the Earth do not emit greenhouse gases or pollutants into the air, it contributes to stopping climate change. United Nations Climate Action delivers that all nations have access to renewable energy sources, however, their potential has not yet been completely realized (2022). By 2050, according to the International Renewable Energy Agency (IRENA), 90 percent of the world's electricity can and ought to come from renewable sources (2021, p.9). For instance, Costa Rica during the first half of 2022, Costa Rica's National Electric System (SEN) added 98.58% more renewable generation (Bnamericas, 2022). The early findings solidify the nation's position as an innovator in the generation of renewable energy owing to its range of diversified and complementary resources and verify the trend that has been going on since 2015.

Figure 3: Hydropower accounts for two thirds of the energy produced by Costa Rica´s national electricity provider.

One of the opportunities renewable energy provide is cheap power (Gavin, 2019). Solar and wind energy can be generated at prices that are lower than those of conventional energy sources, and they can be installed anywhere in the world, bringing electricity to isolated areas where connecting to a grid network would be prohibitively expensive (Gavin, 2019). According to IRENA, between 2010 and 2020, the cost of electricity produced by solar energy decreased by 85%. Onshore and offshore wind energy costs decreased by 56% and 48%, respectively (2022, p.9). In growing economies, practically everywhere the majority of the additional demand for new electricity will come from, falling prices have made renewable energy more alluring. Consequently, cheap prices for energy make it accessible.

Another new door opens as a result of greater usage of clean energy sources. It has a greater job creation impact. Following a new analysis released by the IRENA in partnership with the UN's International Labour Organization (ILO), worldwide employment in the renewable energy sector reached 12.7 million last year, a leap of 700,000 new jobs within only 12 months, despite the lasting repercussions of COVID-19 and energy crisis (2022). An estimated 16 million jobs would be expected in the energy sector, for instance, to occupy new positions in the production of electric cars, incredibly energy-efficient appliances, and cutting-edge technologies like hydrogen (UNCA, 2022). Accordingly, by 2030, more than 30 million employment might be generated in the fields of renewable energy, efficiency, and low-emissions technology.

Figure 4: Renewable energy creates job opportunities

Fossil fuel's contribution to human life and the economy is prominent. However, the full reliance on fossil fuels triggered the earth's temperatures which led to fatal consequences for Earth and its living beings. A solution to utilize renewable energy sources which are clean, feasible, attractive, and economically beneficial is considered to be sort of a blessing to the nations, whilst there are obstacles on the way to fully integrating clean energy into lives that bring more of a curse.

At this point, a shift from fossil fuels and greater development of green energies are believed to be the solution for this human-caused environmental degradation. Now, it is up to nations to determine, whether renewable energy utilization is a curse or a blessing.


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Marzhan Zhailau

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