Saudi royal guards stand on duty in front of portraits of King Abdullah bin Abdulaziz (R), Crown Prince Salman bin Abdulaziz (C) and second deputy Prime Minister Muqrin bin Abdulaziz
Posted on 12/14/2015 12:15:26 PM PST by SeekAndFind
Saudi Arabia spends money like there’s no tomorrow. A new report from the International Monetary Fund suggests that there might not be a tomorrow for the House of Saud. Without massive spending cuts, the Kingdom will exhaust its monetary reserves in five years at current oil prices, the IMF reckons. Saudi Arabia is a rich country full of poor people, and the House of Saud has bought a lot of legitimacy by subsidizing its subjects. The dynasty might not survive the sort of austerity measures that the IMF insists are necessary to keep the Kingdom from running out of reserves by 2020. Egypt, now dependent on Saudi subsidies, also is at risk.
Saudi royal guards stand on duty in front of portraits of King Abdullah bin Abdulaziz (R), Crown Prince Salman bin Abdulaziz (C) and second deputy Prime Minister Muqrin bin Abdulaziz
Gaming the fall of the House of Saud has been a fool’s pastime for years. As William Quandt wrote in Foreign Affairs twenty years ago, “There is a cottage industry forming to predict the impending fall of the House of Saud.” Countless experts claimed to see handwriting on the royal palace wall, but to no avail. Thus far the wily Saudis managed to co-opt, buy off, or butcher the competition. This time is different. As IHS-Janes analyst Meda al Rowas observed last July, Saudi Arabia’s clerical establishment is one of the most important stabilizing mechanisms in the kingdom. Salafist Wahhabi ideology requires obedience to the confirmed ruler, which in Saudi Arabia’s case, is the king,
(Excerpt) Read more at atimes.com ...
When I first glanced at the headline, I read “House of Sand.” Freudian slip.
Then no more money to pay off the Wahhabi imams to keep them from overthrowing the Saudi princes.
Can you guess where a big chunk of senor el Jebbo's funding could be coming from and what his energy policies would be?
Your image is not rendering unfortunately...
The ones you posted aren’t rendering for me, but I can see mine.
So if they run out of money in 5 years... then in 20 years they’ll be as indebted as we are now?
They better hang on to their camels.
Article is absurd. The Saudis are CAUSING cheap oil to destroy U.S. shale.
Obama wanted $4/gal oil. Why are people bashing Bush. Morons. The current price is causing grief everywhere. Maybe the D’s should have thought about that when oil industry wanted to drill in Alaska and offshore. That was 15 years ago.
The Wahhabis have a confirmed ruler now that practices Islam the way the Wahabbis want it implemented. And he is not in Saudi Arabia.
He is the Caliph named Abu Bakr AL Baghdadi and he operates presently out of Raqqa Syria.
The Caliph is leading the fight against the Kafirs (Infidels) just like Muhammed did, while the Saudis collaborate with some Infidel countries. -Tom
I tend to agree, but also the Saudis are losing control of world production. The US is producing, the Russians are producing, and ISIS is producing (and smuggling) and none of them give a sh*t about OPEC quotas.
Even OPEC members are reticent when asked to limit production, they have their own bottom lines to meet.
My fear is that eventually they'll start blowing up wells and sinking tankers, creating a panic to spike the cost of oil. Nothing like a war for profiteering...
These projections are only if all things remain equal - but they won’t.
Oil prices, domestic spending and defense spending (including covert support) will all likely change.
If these don’t change significantly, things will really start hitting the fan in just a couple of years, as their credit rating starts dropping, and weaker petro-states start setting an example of what happens when the party comes to an end.
Saudi international influence would start dropping as they sell off their stakes for cash, and they will start having to sell at low prices, as they become recognized as distressed sellers.
Two more years of rock bottom oil and high expenditures would definitely have the knives out in the palace. There has already been talk of replacing the new king and his son.
They are going to have to pull back from their military adventures, and tighten their belts at home, or they are going to run their country into the wall.
Oil prices are going down before they go back up. We have a “Super Glut” of oil on the market now - an 80 year high. Just last week, Mexico turned away a tanker ship, as there was no available storage for it to unload.
Worldwide, the storage tanks are filled to historic utilization levels. Tanker ships are now being used as holding tanks, rather than transportation. Oil prices could drop sharply in the near term.
If prices really drop in 2016, and things really hit the fan on the Mid East battlefields, The Saudis could have a crisis next year.
High cost producers (including US shale) will eventually shut down operations (finally starting to accelerate) and the stocks will get used up. Prices will likely rebound, but shale technology will probably keep prices from much exceeding $50-60/barrel for long.
Most likely the Saudi regime will be able to ride out this collapse of oil prices. but they will have to cut spending significantly - structurally.
I hope they drown in their own oil. Think of all the spilled blood that their oil has caused. We never should have given them the technology to get it out of the ground.
O! that I should live to see that day ...!
Good if it is true, screw the Saudi’s, what did they ever do for us.
We should have got some of our own damn oil elsewhere.
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