Saudi Arabia’s Waning Influence On the Oil Market

In the 1970s, particularly during the oil embargo of 1973, the oil market was almost single-handedly dominated by then-Saudi Oil Minister Sheikh Ahmad Zaki Yamani. “For more than two decades,” writes Pamela Sherrid, “Ahmed Zaki Al-Yamani’s commands boosted or battered personal pockets books and national economies around the world.” [1] Today, when Saudi Oil Minister Ali Al-Naimi talks, the market yawns, and when his king announces in an international conference that Saudi Arabia will increase crude production, the price of oil goes up.

… The question of whom to blame for high oil prices remains open to debate. Unfortunately, as noted by Stratfor (an intelligence company): “Oil is scarce, oil is needed, oil has no obvious substitutes, and there is nothing that anyone can do to bring more of the stuff onto the market quickly. That is a perfect storm for expensive crude, and no amount of regulatory change is going to alter this bottom line.”

MEMRI