Global Oil Market Before and After Oil Extraction in Saudi Arabia
Global Oil Market Before and After Oil Extraction in Saudi Arabia
KHALED HAMED AL SHEHRI
Contents
Contents 2
INTRODUCTION 3
I. BACKGROUND 3
A.Exploring the Oil in KSA 4
B.Middle East Economy 5
II. GLOBAL MARKET 6
A.Global Market before and after Saudi Oil Exploration 6
B.Current Position of Global Oil Market 6
C.Worldwide Oil Consumption 7
1. Comparison between OECD and Non-OECD Countries 7
III SAUDI ARABIA ROLE IN OIL AND GAS INDUSTRY 9
A.OPEC 9
B.Saudi Arabia role in OPEC 9
IV. IMPROVING SAUDI ARABIAN ECONOMY 10
A.Recommendations & Conclusion 10
Global Oil Market Before and After Oil Extraction in Saudi Arabia
INTRODUCTION
I. BACKGROUND Before the massive oil reserves were uncovered in late 1930’s by geologists, Saudi Arabia was vaguely known around the world for its vast desserts and as a sanctuary for the holy Muslim sites. One cannot say that the economy of Saudi Arabia was poor before they started extracting oil, but at the same time calling it an ‘economy’ is an overstatement in itself because their GDP was non-existent; they can be called as self-sufficient. The situation reversed, as KSA (Kingdom of Saudi Arabia) was successful in discovering the largest oil reserves of the world in the country which made it one of the world’s richest economy and lined it among the powerful nations of the world (Zuhur, 2011). Throughout 1960’s and 1970’s Saudi Arab’s followed a path of rapid economic development (CNN, 2006).
Petroleum liquids take up to for more than 90% of the country’s exports and about 75% of government revenues are accounted by these exports. (CIA, 2013). By earning abnormal profits on oil exports Saudi Arabia became one of the fastest growing economies in the world. The substantial surplus they accumulated as profits by trading oil was used to improve infrastructure of the country and considerable development was made possible as the country became a hub for foreign investment. (Saudi Arabia: Economy,
KHALED HAMED AL SHEHRI
Contents
Contents 2
INTRODUCTION 3
I. BACKGROUND 3
A.Exploring the Oil in KSA 4
B.Middle East Economy 5
II. GLOBAL MARKET 6
A.Global Market before and after Saudi Oil Exploration 6
B.Current Position of Global Oil Market 6
C.Worldwide Oil Consumption 7
1. Comparison between OECD and Non-OECD Countries 7
III SAUDI ARABIA ROLE IN OIL AND GAS INDUSTRY 9
A.OPEC 9
B.Saudi Arabia role in OPEC 9
IV. IMPROVING SAUDI ARABIAN ECONOMY 10
A.Recommendations & Conclusion 10
Global Oil Market Before and After Oil Extraction in Saudi Arabia
INTRODUCTION
I. BACKGROUND Before the massive oil reserves were uncovered in late 1930’s by geologists, Saudi Arabia was vaguely known around the world for its vast desserts and as a sanctuary for the holy Muslim sites. One cannot say that the economy of Saudi Arabia was poor before they started extracting oil, but at the same time calling it an ‘economy’ is an overstatement in itself because their GDP was non-existent; they can be called as self-sufficient. The situation reversed, as KSA (Kingdom of Saudi Arabia) was successful in discovering the largest oil reserves of the world in the country which made it one of the world’s richest economy and lined it among the powerful nations of the world (Zuhur, 2011). Throughout 1960’s and 1970’s Saudi Arab’s followed a path of rapid economic development (CNN, 2006).
Petroleum liquids take up to for more than 90% of the country’s exports and about 75% of government revenues are accounted by these exports. (CIA, 2013). By earning abnormal profits on oil exports Saudi Arabia became one of the fastest growing economies in the world. The substantial surplus they accumulated as profits by trading oil was used to improve infrastructure of the country and considerable development was made possible as the country became a hub for foreign investment. (Saudi Arabia: Economy,
Bibliography: Blecker. (2013). Oil and Gas Exploration and Production. Choucri, N CIA. (2013). The World Fact Book. Retrieved July 17, 2013, from Central Intelligence Agency: https://www.cia.gov/library/publications/the-world-factbook/ CNN Cob, K. (2012). International Energy Statistics. Retrieved July 8, 2013, from OPEC Reserves: http://www.eia.gov/cfapps/ipdbproject/iedindex3.cfm?tid=5&pid=57&aid=6&cid=CG9,&syid=1980&eyid=2012&unit=BB EIA Luciani, G. (2010). From Price Taker to Price Maker?; Saudi Arabia and the World Oil Market. Al-Ghat: the Rahmaniah Annual Seminar. OPEC. (2011). Retrieved July 7, 2013, from OPEC Share of World Crude Oil Reserves 2011: http://www.opec.org/opec_web/en/data_graphs/330.htm OPEC Saudi Arabia: Economy. (2011). Retrieved July 10, 2013, from Global Edge: http://globaledge.msu.edu/countries/saudi-arabia/economy Smith, J TSHA. (2013). OIL AND GAS INDUSTRY. Retrieved July 11, 2013, from Texas State Historical Association: http://www.tshaonline.org/handbook/online/articles/doogz World, A Zuhur, S. (2011). Saudi Arabia. Riyad: ABC-CLIO.