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Riyadh is boom town as Saudis enjoy oil bonanza
Andrew Hammond, Reuters
The malls are full, the cars are fast, the fashions are sharp — conspicuous consumption is king as Saudis enjoy the benefits of oil at almost $100 a barrel.
Little more than a dusty desert outpost three decades ago, Riyadh is a boom town where even a stock market crash last year and a spike in inflation over recent months have failed to halt the orgy of conspicuous consumption.
(16 November 2007)
Energy Bulletin contributor Jeffrey J. Brown writes:
Reportedly, Midland, Texas in the Seventies had the largest Rolls Royce dealership outside the UK, as oil prices increased faster than Texas oil production was falling. Based on our mathematical models, Saudi Arabia in 2005 was at about the same stage of depletion at which Texas peaked in 1972, and Saudi Arabia is going to show two years of back to back production declines in 2006 and 2007.
See Texas and the Lower 48 as a Model for Saudi Arabia and the World (May, 2006)
Black Gold Finances the Dreams for Abu Dhabi
Ivan Watson, National Public Radio (NPR)
One of the countries winning big from record-high oil prices is the United Arab Emirates.
This federation of seven small sheikdoms in the Persian Gulf only became an independent state in 1971.
Thanks to its oil wealth, it has transformed itself from an undeveloped backwater into one of the world’s fastest-growing economies.
With the latest flood of petrodollars, the United Arab Emirates’ rulers have set even more ambitious goals.
(15 November 2007)
How Would You Manage Saudi’s Reserves?
Robert Rapier, The Oil Drum:Europe
My impression is that we spend a lot of time trying to interpret comments or actions from Saudi Arabia, without attempting to understand the issues from their perspective. I think it is a useful exercise to ask whether their specific actions or comments make sense; 1). From the Saudi perspective, and 2). In the context of the market.
…Along the same theme, I frequently consider how I would manage Saudi’s reserves if I was in the position to do so. I think those who feel Saudi should be pumping all the oil they can at these prices haven’t really thought it through from their perspective. So, let’s go through that thought experiment, keeping in mind:
1). The primary allegiance is to Saudi Arabia.
2). This depleting resource must serve future generations.
3). OPEC must be on board with the decisions.
My primary objective would be to extract the most money I could from the rest of the world, but not so much as to cause a worldwide recession that would destroy demand. So, how would I achieve this? Very cautiously. Each time oil prices moved into new territory, I would seek to stabilize the price for a while so I could judge the impact on the world economy. As long as the world economy could cope with the price, I would continue to let it creep higher.
(15 November 2007)
Big day looms for Venezuela
Simon Romero, International Herald Tribune
In two weeks, Venezuela could be starting an extraordinary experiment in centralized socialism fueled by oil. By law, the workday would be cut to six hours. Street vendors, housewives and maids would have state-mandated pensions. And President Hugo Chávez would have significantly enhanced powers and be eligible for re-election for the rest of his life.
A new constitution, expected to be approved by referendum Dec. 2, is both bolstering Chávez’s popularity among people who will benefit and stirring contempt from economists who declare it demagoguery. Signaling new instability here, dissent is also emerging from among his former lieutenants, some of whom say the president is carrying out a populist coup.
“There is a perverse subversion of our existing Constitution under way,” said General Raúl Isaías Baduela, a retired defense minister and former confidant of Chávez’s who broke with him this month and defected to the political opposition. “This is not a reform,” Baduel said in an interview. “I categorize it as a coup d’état.”
Chávez loyalists already control the National Assembly, the Supreme Court, almost every state government, the entire federal bureaucracy and newly nationalized companies in the telephone, electricity and oil industries.
(16 November 2007)
Qatar says dollar slide eroding purchasing power
Kuwait Times
DUBAI: Qatar, which pegs its riyal to dollar, is concerned that the US currency’s slide on global markets is eroding the country’s purchasing power, the oil and gas exporter’s deputy prime minister said.
Today we feel concerned because of the very large decline in the value of the dollar,” Deputy Prime Minister Abdullah bin Hamad al-Attiyah said in remarks aired by Al Arabiya television yesterday.
(17 November 2007)
