The politics of petroleum and the Energy Charter Treaty as an effective investment regime

Abstract

The Energy Charter Treaty is assessed as an international regime for the promotion of investment in petroleum among participating states. Like any other international regime, the eventual effectiveness of this treaty will depend more on the convergence of interests of the parties than on legal niceties and enforcement. These parties include not only the signatory states but also state and private enterprises and subnational authorities. This analysis concludes that a high degree of convergence of interests exists among the signatory states, and this is underpinned by the need for transnational transport of petroleum. Set against this convergence is the undoubted divergence of interests in many states between the national governments on the one hand and companies and subnational authorities on the other. Political reform towards democracy will be needed for these conflicts of interests to be reconciled and for the Energy Charter Treaty regime to become fully effective.