By Richard Heinberg: Saudis and Trump: Gambling Bigly

If you’re like me, you find the Middle East difficult to understand with its many tribal, religious, energy, and geopolitical themes.

This essay by Richard Heinberg does a nice job of explaining what’s going on in the Middle East today. Because our civilization depends on Middle East oil, it is an important topic worth understanding.

Imagine a hypothetical Middle Eastern monarchy in which:

  • Virtually all wealth comes from the extraction and sale of depleting, non-renewable, climate changing petroleum;
  • Domestic oil consumption is rising rapidly, which means that, as long as this trend continues and overall oil production doesn’t rise to compensate, the country’s net oil exports are destined to decline year by year;
  • The state has a history of supporting a radical version of Sunni Islam, but the people who live near its oilfields are mostly Shiite Muslims;
  • Power and income have been shared by direct descendants of the royal founder of the state for the past 80 years, but the thousands of princes on the take don’t always get along well;
  • Many of the princes have expatriated the wealth of the country overseas;
  • Population is growing at well over two percent annually (doubling in size every 30 years), and, as a result, 70 percent of the country is under age 30 with increasing numbers in need of a job;
  • Roughly 30 percent of the population consists of immigrants—many of whom are treated terribly—who have been brought into the country to perform labor that nationals don’t want to do;
  • A sizeable portion of the nation’s enormous wealth has been spent on elaborate weapons systems and on fighting foreign wars;
  • A powerful Shia Muslim nation located just a couple of hundred miles away has gained geopolitical advantage in recent years; and,
  • For the past three years oil prices have been too low to enable the kingdom to meet its obligations, so it has rapidly been spending down its cash reserves.

Now, ask yourself: What could possibly go wrong here?

We are, of course, discussing Saudi Arabia, which has been much in the news lately.


The centerpiece of “Vision 2030” is the proposal for a purpose-built city, Neom, that would be powered by solar panels and busied by cutting-edge industries like artificial intelligence, biotechnology, IoT, and robotics; its water would be supplied by desalination plants and its food grown hydroponically. Neom, if ever actually built, would most likely either be an enormous waste of billions of dollars and untold amounts of natural resources that can never be used for better purposes (as in hundreds of Chinese “ghost cities”), or would lead to an even uglier and more extreme version of haves vs. have-nots than already exists in Saudi Arabia. Add continued rapid population growth and the whole exercise becomes transparently futile.

A cheaper and more sensible plan (though likely not as popular) would be to end population growth, slash overall consumption, reduce economic inequality, make peace in the region, and aim for home-grown development of intermediate technology. Not as glamorous, not as attractive to an ambitious risk taker. But practical nonetheless.

However, even this plan comes with substantial risks, as climate change could foreclose on any progress by 2100 with deadly high temperatures that make much of the Middle East uninhabitable by humans. If the region still has a window for peaceful adaptation, it is small and quickly narrowing.

3 thoughts on “By Richard Heinberg: Saudis and Trump: Gambling Bigly”

  1. A nice two part essay by Allan Stromfeldt Christensen.

    No, Not NEOM Nor Even Women Can Save Saudi Arabia and its Monarchy from Peak Oil and Collapse [part 1/2]

    The Coming Fall of the House of Saud: Austerity is in, and the Countdown to Saudi Arabia’s Fire Sale is On! [part 2/2]


  2. House of Saud: A Family at War

    This denial thingy is amazing.

    I just finished this excellent 3 x 1 hour BBC documentary on Saudi Arabia. Really good old school in depth journalism. Covered every dimension of the country including economy, demographics, culture, religion, corruption, foreign affairs, history, etc. The big picture conclusion was that revolutionary changes are being forced because they are now running deficits and blowing through their financial reserves.

    The only topic they did not touch, even for a second, was what is the probable state and remaining lifetime of the Saudi oil reserves? And what are the implications for the world? In other words, the only thing they did not investigate was the only thing that matters, and the obvious elephant in the room.

    How is this possible?

    Why wasn’t the producer fired for gross incompetence?

    Why don’t more people see what I see?

    Oh yeah, humans exist because we evolved to deny reality.


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