Saudi Arabia: The Elefant in the Room

The protests in Egypt, which now seem to be dying down, leaving the regime still in place, have sparked a lot of talk about what other countries in the Arab world might have their autocratic regimes toppled by protesters. Jordan and Yemen, having experienced protests already, are obvious candidates. Absent from most discussions, though, is Saudi Arabia. This is presumably because most view it to be rock-solid. Or is it because the idea of a revolution or civil war breaking out in Saudi Arabia is too frightening to contemplate?

Robert Baer famously argued in an article in the Atlantic Monthly back in 2003 that Saudi Arabia was not nearly as stable as many presumed/wished. Aside from concerns about Saudi money funding Islamist outfits all over the globe (read the article, it's an eye-opener), the assertions of the frailty of the regime, as well as of the importance of stability in Saudi Arabia for world political and economic security, are unnerving:

  • "Saudi Arabia controls the largest share of the world's oil and serves as the market regulator for the global petroleum industry.
  • If the Saudi oil spigot is shut off, by terrorism or by political revolution, the effect on the global economy... will be devastating.
  • Saudi oil is controlled by an increasingly bankrupt, criminal, dysfunctional, and out-of-touch royal family that is hated by the people it rules and by the nations that surround its kingdom."
What's more, Saudi Arabia's oil infrastructure is very vulnerable to attack. Shutting down just one or two major processing centers and pipelines could essentially stop the oil flow out of the kingdom. This could happen as a side-effect of a revolution (e.g. through neglect and a collapse in the support infrastructure between governments). Gasoline prices of $4 per gallon would then seem Utopian. The weak recoveries in the rich world could end with high inflation and higher interest rates. Unemployment would rise further.

Then there are the political consequences. Right now, US-backed Saudi Arabia can be counted on to act as a counterweight to Iran in the region and to ensure the free flow of oil and other goods off both of its coasts. Indeed, one theory about the reasoning behind the Iraq War was that some US policymakers feared the eventual collapse of Saudi Arabia and wanted to create an American ally (Iraq) to counterbalance Iran's influences in the region. If Egypt were ruled even by a moderate grouping including the Muslim Brotherhood, it could nonetheless be expected to take a decidedly less pro-Western stance. Now imagine losing Saudi Arabia as an ally, too, which has generally been willing to boost oil output when the US was in need and to provide a moderating political influence in the Middle East (at least through its official diplomacy, if not through the Islamist ventures it funds abroad!).

If Egypt and Saudi Arabia became real democracies (and this is a big "if," especially in the case of the latter), this would be something to celebrate, even as we learned to deal with the political and economic consequences as best we could. There is a whole range of possible scenarios. Some of them, though, border on the apocalyptic. Baer believes it's only a matter of time before Saudi Arabia collapses. It could be a turbulent and, at times, scary new world.


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