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Saudi Arabia: From Pivotal To Pointless
How decarbonization and dictatorship combine to leave Saudi Arabia with no future
Few people know much about Saudi Arabia, not least because it’s quite a hermetic sort of country. Even the expatriates who work there glimpse only a fraction of Saudi life and the journalists who occasionally report on some sensationalistic story merely skim over the surface and leave much unsaid. To understand the current plight of Saudi Arabia, therefore, it’s necessary to provide some brief context.
For nearly a century, the desert kingdom was central to Western economic life. This is because the West depended on oil for nearly all of its energy needs, and Saudi Arabia contained not only the world’s largest proven reserves but also was blessed with the cheapest cost of extraction. As a result, Saudi Arabia acted as the “swing state” when it came to global supply, being able to open or close the taps depending on what the rulers imagined to be in their best interests. This was unlike Russia, where decades of corruption, under-investment, and abysmal manufacturing standards led to oil fields that could barely produce a fraction of their theoretical capacity.
For those too young to remember, the oil shock of 1973 led to nearly a decade of inflation combined with recession in the West — and…
