Saudi dominance of oil market to fade by 2020

Telcoguy Sunday, 23 December 2012 12:44 PM - UAE

@ali, sorry I just posted a comment complaining about the lack of reaction!
You are essentially right, well you forgot the 3rd option that is bury your head on the sand and deny, deny, deny
However I don't think option 1 needs to be traumatic, it will be tough, and it will test the allegiances of people, but it is the only sustainable alternative. I think Oman has moved farther down that road, even if out of necessity, and it offers a more balanced path
The big question, specially in Saudi is to which point certain groups are willing to reduce their privileges in order to maintain stability. I think for the smaller countries (specially Qatar and UAE) it should be easier as they have a smaller population, and higher resources per capita. What I fail to see is the willingness to change on a personal level and accept that once you move down that road some people will thrive while others will not

I may certainly be wrong, as my experience is always as an outsider

Telcoguy Sunday, 23 December 2012 12:42 PM - UAE

A nice piece, well documented and touching on what should be a critical issue. Surprisingly (or maybe not) no comments.
That says a lot.

Ali Saturday, 22 December 2012 6:24 PM - Oman

Social spending will certainly impact the government's abilities to meet its financial obligations as oil prices or reserves take a dip. That leaves the government with two options:1) cut social spending and force people to depend on themselves, maybe pay taxes as well and 2) continue with the current commitments of social spending and find alternatives to fund deficits.

The first option is certainly going to ignite the public and call for demonstration while the 2nd option will aggregate the burden on public finance and eventually would force the government to take measures such as currency devaluation and other unpleasant quick fixes. This in turn will ignite further public anger and demonstration.