Please note I am not the author of this article, the reason I am posting is that I found it very interesting and it covers my areas of interest. Should you wish to use it for research purposes, please seek the appropriate references.
“Democracy has an interesting relationship with oil. Some studies suggest it is not necessarily a pleasant one. “When income rises governments tend to be more democratic, but if the rise of income can be traced to country’s oil wealth, this democratizing effect will shrink or disappear” [Tsui 2005; Jensen and Wantchekon 2004; Ross 2001; Wantchekon 2000; Barro 1999; Crystal 1990]. Thomas Friedman, an American columnist, has gone to the extent of claiming that “oil and democracy cannot coexist”  .
Although this premise is still unsettled [Ross 2009], there is still need for more research to explore the exact relationship between the two. Acknowledging dearth of research on oil-democracy relationship Brenda Shaffer has urged that “a new body of literature needs to be developed” that deals with “democratic transition of major energy exporters”.
This paper, however, would explore the oil-democracy relationship from a different perspective i.e. if oil is bad for democracy can the reverse also be true? Can democracy adversely affect oil production and energy security? A preliminary inspection of works on oil-democracy relationship reveals that no significant effort has been made so far to study “energy security” and “democracy” as two convergent goals of US foreign policy.
This paper will look at views of some experts who support that more democracy in the Middle East might lead to anti-American forces occupying positions of power. Such a situation, they say, might compromise US strategic interests in the region, particularly its energy security. Subsequently the paper counters the argument with more recent works which indicate that in reality democracy and transparent elections are throwing radical forces in Middle East out of power. In the end, the paper makes a study of Iraq and investigates how more democracy may explain more secure and sustainable oil supplies for the US.
WHY SOME PEOPLE DESPISE DEMOCRACY?
Despite its stated commitment to liberalism and democracy internationally, the United States has frequently chosen to back repressive or authoritarian regimes in parts of the world. David Schmitz argues that the “U.S. policymakers viewed authoritarian regimes as the only vehicles for maintaining political stability and encouraging economic growth. Expediency, he says, overcame ideology and the United States gained useful — albeit brutal and corrupt — allies who supported American policies and provided a favorable atmosphere for U.S. trade. (Book: Thank God They Are on Our Side)
Articulating US skepticism about the outcomes of democracy in the Middle East, Gause (2005) questions that “Even if democracy were achieved in the Middle East, what kind of governments would it produce? Would they cooperate with the United States on important policy objectives [like] ensuring steady supplies of oil? Democracy in the Middle East, he argues, is likely to produce new Islamist governments that would be much less willing to cooperate with the United States than are the current authoritarian rulers. The most important observation he puts forward is that there is no “close link between terrorism and authoritarianism” and that statistically democracies are no less susceptible to terrorism than are other forms of government. So according to him more democracy would not mean less terrorism. (F. Gregory Gause III FOREIGN AFFAIRS Can Democracy Stop Terrorism? Volume 84 No.5, September/October 2005)
Similar fears regarding democracy were expressed by Rachel Bronson (2006) in her book on US-Saudi relationship where she argued that pursuing a reform agenda in Saudi Arabia is “of secondary importance.” She recognized that reform, “if pursued deftly,” could reassure US partners in the Middle East and help resolve “the virulent anti-Americanism that permeates the region.” But she looked with skepticism the idea that political reform, in particular, could help curb extremism: “Violent religious fighters have not emerged simply as a response to authoritarian rule. … Quickly opening up political space will not quell their violence. It will only allow them a space in the political process.”
WHY SOME PEOPLE HAVE FAITH IN DEMOCRACY?
Shadi Hamid and Steven Brooks disagreed with Gause’s fears about the inability of democracy to eradicate terrorism and claimed that Gause provides a “right answer to the wrong question”. Gause’s argument, they say, “tells us nothing about how, why, and when terrorists resort to violence”. He fails to explain, for example, which kinds of countries are more likely to produce terrorists? He based his thesis on incidents of terrorist attacks in democratic countries, while failing to realize that democracies, due to their open nature, may be more susceptible to terrorist attacks but they do not necessarily produce their perpetrators.
Similarly, Toby Jones who is a historian of modern Middle East, while writing review of Bronson’s book opines that her “caution” about pushing for reform in Saudi Arabia is understandable — in theory, radicals could benefit from political liberalization and come to dominate the Saudi political system — it seems excessive. In the 2005 Saudi municipal council elections, he explains, voters in Riyadh and Jidda did not choose the most radical candidates on the ballot; they opted for more moderate Islamists, who at least claimed to be interested in serving the community. Islamist candidates lost even in the town of Buraydah, the spiritual heartland of Wahhabism. Jones further argues that almost all Saudis, liberal or not, are critical of the United States, and it is possible that the most outspoken among them would pursue a more decidedly anti-American agenda if they rose to power. But it is just as plausible that their anger would subside if Washington seriously pressured the royal family to include them in the Saudi political process. Moreover, as John Bradley shows, Saudi Arabia is hardly homogenous. Opening up its political system would likely create a culturally, religiously, and ideologically complex nation — and a far worthier partner for the United States. (http://www.foreignaffairs.com/articles/61523/toby-jones/shifting-sands?page=show)
Almost similar perspective about democratization in the Muslim World was expressed by Amir Taheri in his Wall Street Journal article “Islam at the Ballot Box” published on 21st February 2008. Starting with Pakistan’s 2008 general elections, he says that “despite vast sums of money spent by the Islamic Republic in Tehran and wealthy Arabs from the Persian Gulf states, the MMA (Mutahid Majlis-e-Amal) failed to achieve the ‘approaching victory’ that Islamist candidates, both Shiite and Sunni, had boasted was coming”.
He argues that the Islamist defeat in Pakistan confirms a trend that’s been under way for years. Supporting the spread of democracy in the Middle East as stated in Bush Doctrine, he writes that many analysts in the West suggest that Muslims were not ready for democracy, and that elections would only translate into victory for hard-line Islamists, but “the facts tell a different story” altogether.
Taheri claims that results of recent election in Jordan, Malaysia, Bangladesh, Gaza and the West Bank, Turkey, Algeria, Yemen, Kuwait, Lebanon, Egypt, Oman, Bahrain, Tunisia, Libya and Afghanistan, clearly indicate that “no Islamist party has managed to win a majority of the popular vote” and that “the Islamist share of the vote has been declining across the board”.
The recent talk of making peace with the Taliban in Afghanistan and bringing them into political mainstream  indicates an understanding on part of major players in the region that peace can be achieved through bringing divergent groups on one table. If one group keeps clinging on to the power on one pretext or the other and does not allow other groups to pursue their legitimate ambitions than resentment is bound to grow. Democracy therefore provides a workable way for each group to win its due share in the power structure and to channelized its energies into building stronger partnerships that serve the people’s interests, instead of wasting them in fighting “foreign occupations” and “infidels”.
DEMOCRACY IN IRAQ: IMPLICATION FOR US ENERGY SECURITY
According to the US Energy Information Administration (EIA), “Iraq was the world’s 13th largest oil producer in 2008, and has the world’s third largest proven petroleum reserves after Saudi Arabia and Canada”. Indicating that “Just a fraction of Iraq’s known fields are in development”, EIA claims that “Iraq may be one of the few places left where vast reserves, proven and unknown, have barely been exploited”.
EIA claims that Iraq’s oil sector has suffered over the past several decades from sanctions and war, and its oil infrastructure is in need of modernization and investment. As of March 31, 2009, the United States had allocated $2.05 billion to the Iraqi oil and gas sector to begin this modernizationhttp://www.eia.doe.gov/emeu/cabs/Iraq/pdf.pdf
The primary US energy security goals in Iraq are:
the dormant Iraqi oil sector becomes vibrant as soon as possible,
the Iraqi Hydrocarbon Law be passed as soon as possible. The law guarantees a profit for foreign oil companies and allow Iraq’s provinces freedom from the central government in giving exploration and production contracts.
As a result of March 2010 Iraq’s parliamentary elections four parties namely National Movement, State of Law Coalition, National Iraq Alliance, and Kurdistan Alliance secured 81.68% of 11526412 votes (total turnout remained 62.4%) (Source: www.themajlis.org)
To this date there is political stalemate and no party has clear majority to form the government. Despite criticism on the Hydrocarbon Law almost all parties who have won majority of votes want to pass the law. So it means that democracy in Iraq is not antagonistic to US energy security. The only aspect of nascent democracies which keeps on creating problems for the US is their immaturity and political instability. This is a price that must be paid to forge long-term alliances in the region”.