ME Oil

Was the oil crises of 1999-2000 different from all others?"

Annual review authored and distributed by Prof. Eliyahu Kanovsky, Bar-Ilan University, internationally respected authority on the economics of Middle East countries recently published his current findings [21 March 2002].

Excerpts follow:

EXCERPTS:

• There is no shortage of oil on the horizon and long term prices (in dollars) will be approximately stable or with a slight downward trend. (presumes absence of wars or similar political upheavals).

• None of the Gulf oil states have succeeded in diversifying their economies away from oil; all are trapped into consuming up to 90% of annual revenues.
  

About 150,000 young Saudis enter the work force each year . Some 50,000 find work. Employers prefer Asian workers. In Saudi Arabia extravagance, corruption, and the privileges of a royal family that numbers 30,000, have lead to a national debt of $160 billion, approximating GDP (Gross Domestic Product). Per capita GDP has fallen to one fourth of its 1980 peak.

• World oil output is rising. Russia's output is rising.

"It is my view that the long run trend of oil prices is downward (inflation-corrected dollars). Barring exogenous oil shocks (wars, revolutions etc.) there is good reason to anticipate ...the long term downtrend in oil prices."

Independent Media Review and Analysis http://www.imra.org.il