Some political commentary circulating in the Guyanese social media space recently made the following claim.
“The people of Guyana get double the oil revenue because of Trump’s attack on Iran. This should be a good thing.”
The argument reflects a line of thinking that appears frequently whenever global conflict affects commodity prices. The assumption is simple. If war or instability removes or weakens a competitor in the oil market, then other producers automatically benefit.
But that logic resembles a bar fight more than a serious economic analysis. One person gets knocked out, and the rest scramble for his wallet. It may work in a movie script. In real economies, it usually creates a far larger problem a few years later.
Oil markets do not function like a zero-sum street brawl where eliminating one competitor guarantees victory for the others. Energy markets are driven by demand, investment confidence, and long-term consumption patterns. When geopolitical conflict drives oil prices sharply upward, it often triggers the opposite of what producers expect.
Higher prices encourage consumers to reduce consumption. Governments accelerate investments in alternative energy sources. Industries are redesigning systems to rely less on oil. Over time, that process shrinks the total market available to producers.
History provides several clear examples. The oil shocks of the 1970s led to a dramatic spike in producers’ prices. In the years that followed, fuel efficiency standards increased, nuclear and renewable energy expanded, and global oil demand grew significantly more slowly.
Short-term gains can therefore produce long-term losses.
For a country such as Guyana, whose emerging oil sector is now a major pillar of national revenue, the real objective should not be to weaken or eliminate competitors. Sustainable prosperity depends on expanding markets and improving efficiency.
A larger global middle class increases energy consumption through transportation, manufacturing, and infrastructure development. As more countries industrialize, demand for petroleum products naturally rises. That creates stable and predictable markets for producers.
Efficiency is equally important. Producers that can extract and deliver oil at a lower cost remain competitive even when prices fall. Countries that invest wisely in infrastructure, education, and economic diversification are better positioned to convert temporary oil revenue into long term national wealth.
In that context, geopolitical conflict should not be viewed as a strategy for economic success. Wars and instability disrupt shipping, financial markets, and global trade. The same turmoil that raises prices today can reduce demand tomorrow.
Guyana’s long-term opportunity lies in the responsible management of its energy resources, efficient production, and strategic investment of its oil revenues. Expanding prosperity and building stable markets will ultimately serve the country far better than hoping global conflict temporarily removes competitors from the field.
