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THE Saudi Arabia Thread pt 6

A forum for discussion of regional topics including oil depletion but also government, society, and the future.

Re: Saudi Arabia groundwater to run out in 13 years

Unread postby Shaved Monkey » Sun 21 Feb 2016, 18:54:12

AdamB wrote:Turning sea water into drinking water is economically viable. People are already doing it. So this one is a no brainer. Not a landlocked country? You win! Otherwise this entire "OMG THE WATER IS GOING AWAY!" is just trying to make a mountain out of a molehill.

All it needs is lots of power and an economy that can pay the power bill and the maintenance costs.
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Re: Saudi Arabia: Canary in the oil glut coal mine

Unread postby evilgenius » Tue 23 Feb 2016, 13:34:48

I work as an independent contractor in the US, alongside several Muslims from various countries. One of them, from Jordan, told me about a conspiracy theory the other day. He said that he believes that the Kingdom of Saudi Arabia is in cahoots with the US. They are trying to shipwreck the Russian economy. To be fair, at times he goes on like he believes this, and then at times he doesn't.

There appears to me to be a whole network of conspiracies at work in the Arabic speaking world. This is only one of them. He has mentioned others which, incidentally, run counter to this one. What I take away from this is that their conspiracy nutjobs are as crazy as our conspiracy nutjobs.

The danger of conspiratorial thinking is not that it might be true, though, but how it poisons people's capacity for rational thought. Pretty soon the truth sounds like nothing more than a competing story line to those who listen too closely. Then it really does become a matter of who does what for whom, and how recently they have done it.

Both the Chinese and the Saudis are in the same precarious place when it comes to their own people. Neither can afford for them to become restive on any kind of large scale, especially not in the manner that hunger can promote that. As much as I would like to see a more truly democratic Saudi Arabia I'm not certain that uprising is necessarily the way to achieve it. In fact, it may not even be a likely outcome following such a thing. I wonder what the statistics are on the kinds of revolutions that bored and highly excitable educated youth prefer to pull off?
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Re: Saudi Arabia: Canary in the oil glut coal mine

Unread postby evilgenius » Wed 24 Feb 2016, 12:04:22

pstarr wrote:evilgenius, your Muslim buddy's theory does seem outlandish on the face of it: Saudi Arabia can not afford to bankrupt itself with overproduction and dangerously low oil income. However his paranoia is not misplaced. Isn't this precisely what occurred back in the early 1980's when Saudi Arabia suddenly inflated its reserves in order to produce more oil. This was on orders of President Reagan. It crushed the Russian oil economy and ended the Soviet Union.


You just reminded me how important the price of oil always has been to the American economy. When Reagan did that It made the price of oil per barrel pretty cheap, but it was still important what it was relative to other costs. According to your income level you could still find yourself complaining about the price at the pump, although it was nearly nothing in today's dollars. If you were somehow tied to white collar work and you felt like it made a difference to get a break on the price you might use the extra money to buy things. If you were a blue collar worker you might have done the same. I recall a resurgence in the sale of big automobiles. Entrepreneurs, however, who had to watch costs, got to see it as making more money.

That entrepreneurial spirit pervaded the housing market based economy in so many ways in the run up to 2007-8. We should never forget that it was $5 plus per gallon gasoline that actually tanked the economy. The entrepreneurs who had become so much of a percentage of what the economy was made of simply passed a threshold beyond which they could no longer participate. Something seems to have changed because these cheap gas prices are not bringing about the desired economic stimulus. Maybe Americans are gun shy and don't trust the cheap prices to remain? Maybe, in order for entrepreneurs to place their bets, they have to rely upon more than the seeming whim of the Saudis in their fight against US frackers? After all, the fracking industry appears to have already crumpled. It's only a matter of time, and then what? People need more confidence than that before most of them will go out and purchase a big truck, that takes years to pay off, that might help them make some money, for instance.

Yeah, the conspiracy theories I've heard are kinda strange, some of them. Others sound just like the 'New World Order' nutjobs who hold sway over the airwaves over here. When things aren't going so well people eat that s**t up with a spoon. When things are going well you might run across the odd book or two at a garage sale which, when you look at it for a second, sounds totally crazy and out of place. Based on the conspiracy yardstick, I'd have to say whatever economic ills are happening are definitely global.
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Re: Saudi Arabia: Canary in the oil glut coal mine

Unread postby ennui2 » Wed 24 Feb 2016, 12:15:14

evilgenius wrote:We should never forget that it was $5 plus per gallon gasoline that actually tanked the economy.


It never got to $5 and that isn't what crashed the economy.

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Re: Saudi Arabia: Canary in the oil glut coal mine

Unread postby evilgenius » Wed 24 Feb 2016, 16:20:40

ennui2 wrote:
evilgenius wrote:We should never forget that it was $5 plus per gallon gasoline that actually tanked the economy.


It never got to $5 and that isn't what crashed the economy.

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You can say that it never got to $5 where you lived, or even nationally. I paid something close to $5.50 one day and 3 days later it was under $1.40, at the same station. I remember the tension, and how for weeks I drove the highway nearly every day and no one was speeding. They were trying to conserve gas. I was too. The pressure was getting to people. The price of gas was something they couldn't control, but were desperate to try to meet. Without fuel they couldn't keep working.

I see what you mean by blaming their debt, but you aren't thinking at the level of boots on the ground. People were juggling their payments. As long as they could keep working they would have some kind of income to try and manage their debt. People are creative that way. Gas just kept climbing, as if there really was a little extra somewhere to pay for it. Then the price got so high that there simply wasn't. It's pretty hard to drive around and make money in the F-350 if the tank is empty. Once their backs were broken, and the cash flow stopped, it didn't matter that the stations reacted so quickly to bring the price back down. They needed that help when the difficult choices were being made, not after.
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Re: Saudi Arabia: Canary in the oil glut coal mine

Unread postby Outcast_Searcher » Wed 24 Feb 2016, 17:15:57

pstarr wrote:Meanwhile during the time frame of the meaningless chart that extra $2.00/gallon in gasoline cost the American consumer $365 billion each and every year of that reset. Most of the money was lost to the American economy and sent overseas. Oil broke us, not random speculators.)

According to the credible sources like economists, the global housing bust which hit the global banking system was the primary factor causing the 2008-2009 deep recession. (But let's never admit THAT, since this is a peak oil site.) https://en.wikipedia.org/wiki/Financial ... E2%80%9308

Denying that is about as credible as claiming current low prices are because globally consumers can't afford oil products at about a THIRD of what they cost in the 2010-2014 period, even though the global economy has continued to improve.
Given the track record of the perma-doomer blogs, I wouldn't bet a fast crash doomer's money on their predictions.
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Re: Saudi Arabia: Canary in the oil glut coal mine

Unread postby AdamB » Wed 24 Feb 2016, 18:09:14

pstarr wrote:Okay it Mos, you are correct it was $4 that tanked the economy.


Yeah, that isn't what the chart said either.

Some of us paid less during the $4/gal period because we collected econoboxes to commute in, and paid less for gasoline overall, even with a doubling in price. This thing economists like to call "substitution", in the form of substituting a more efficient car for a less efficient one, or "conservation", which was those of us who did this using less because of it.

In either case, it didn't even affect my budget. But that isn't how the housing bubble worked, and that is why it, and not the moderate price of fuel, caused the 2008 disaster.
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Re: Saudi Arabia: Canary in the oil glut coal mine

Unread postby AdamB » Wed 24 Feb 2016, 18:09:58

pstarr wrote:So you are saying the $365 billion stolen from the economy every year by the evil oil companies had nothing to do with the housing bust?


Are you a bot? :?:
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Re: Saudi Arabia: Canary in the oil glut coal mine

Unread postby evilgenius » Wed 24 Feb 2016, 18:49:38

AdamB wrote:
pstarr wrote:Okay it Mos, you are correct it was $4 that tanked the economy.


Yeah, that isn't what the chart said either.

Some of us paid less during the $4/gal period because we collected econoboxes to commute in, and paid less for gasoline overall, even with a doubling in price. This thing economists like to call "substitution", in the form of substituting a more efficient car for a less efficient one, or "conservation", which was those of us who did this using less because of it.

In either case, it didn't even affect my budget. But that isn't how the housing bubble worked, and that is why it, and not the moderate price of fuel, caused the 2008 disaster.


Do you remember how fuel efficient used cars went way up in price during the fuel price run up? If you worked in a job that wasn't related to housing you could probably absorb that. You had an income stream that was steady. The marginally significant people who were the hewers of wood and drawers of water for the construction industry couldn't work out of the back of a Civic, though. The best they could do was to try and keep working, at whatever there was. We should not forget how many men of working age had been drawn into construction by then either, and organized their lives in commitment to it. In the years running up to the crisis I had met chefs, accountants, etc. People had gone into it from all walks of life because it was paying so well. It did require that commitment, though. They were into that lifestyle for tools, at the very least, and probably didn't own a single fuel efficient vehicle on average.
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Re: Saudi Arabia: Canary in the oil glut coal mine

Unread postby ennui2 » Wed 24 Feb 2016, 20:16:12

evilgenius wrote:I see what you mean by blaming their debt, but you aren't thinking at the level of boots on the ground.


I've heard this argument ad nauseum. The extra gas expenses per month was small in comparison to the extras the ARM resets suddenly added to their mortgage payments. So expensive gas was a problem, but not the primary cause of the economy keeling over.
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Re: Saudi Arabia: Canary in the oil glut coal mine

Unread postby evilgenius » Thu 25 Feb 2016, 16:12:06

ennui2 wrote:
evilgenius wrote:I see what you mean by blaming their debt, but you aren't thinking at the level of boots on the ground.


I've heard this argument ad nauseum. The extra gas expenses per month was small in comparison to the extras the ARM resets suddenly added to their mortgage payments. So expensive gas was a problem, but not the primary cause of the economy keeling over.


Ad nauseum, huh. I respect where you are coming from. I don't deny that the monthly struggle that people had to face was largely formed out of debt. It was going to go over at some point. The micro economics of the situation, however, doesn't reveal a tie between the monthly cost of making payments and the ability to earn an income.

During the housing run up gasoline was a direct cost of doing business for almost everyone involved in construction. When it was cheap it was nominal, a cost but just another small one on a list. Facing the resets, however, and also needing to take low gas mileage vehicles around in an effort to make any kind of money, they couldn't survive.

I'm talking marginal expenses here which grew to absurd levels. I'm making a nod to the way in the US where there has always been a dearth of a safety net support system, but a strong system under which entrepreneurs could go out and find a way. Cheap gas was part of that way.

We have never taxed gas to the point of the Europeans because we don't want to finance their kind of support systems. The lack of that kind of tax burden often revealed ways for people to make a living. The high prices in the gas price run up eliminated those opportunities at the same time as people were facing other expenses. The loss of those opportunities eliminated the chance of making payments. You can't do that when the most you can make in a day is $100, let's say, which is a pay cut but by itself still manageable, and it cost you $80 in gas to make that $100. You might if it only cost $60. At some point it becomes Abraham arguing to spare Sodom.

Incidentally, the same thing is going on again, right now. The economy is re-balancing in a very dangerous way. It is becoming full of Uber and Lyft drivers. There are so many of them that the price per ride they can receive is beginning to come down. Even though this is occurring the numbers of people who are taking to this way of earning is still increasing. It could well rise to achieve the same kind of imbalance that we saw when so many people, then it was mostly men but now it is both sexes, piled into the construction industry. All it would need would be $3.50 plus gas to bury many of those people. If that happened, of course, the price of gas would not be the thing that actually broke them, you can already see that. It would be things along the line of too much debt again, company store car debt along with other debt and probably high rent over ownership related expenses this time. No doubt the economy under which such a high price per gallon came about would also constrain the demand for rides as well. But I've never been talking about those big obvious reasons, but the marginal things because people tend to go as far as they can with something that they have committed to, until they can't go any farther. Sometimes they find a way.

And tying things back to Saudi Arabia, the current adjustments being made, Uber and Lyft not being the only ones, do rely upon cheap gasoline in order for people to pull them off. It isn't that cheap gas is the most prominent part of the equations these people make when they consider whether they want to commit to things either. It is more that people tend to borrow clear up to whatever they are making, without considering what would happen to them if things changed. The thinking is no different than knowing you have a balloon payment due sometime, but that is then and this is now. They will deal with it when it comes. They may find a way. Cross your fingers on the Saudis.
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Re: Saudi Arabia groundwater to run out in 13 years

Unread postby americandream » Thu 25 Feb 2016, 22:19:54

To quote Tanada:

"While oil extraction is the largest mining system in KSA it is far from the only one. They mine metals, quarry stone and in general have gone a long way to diversify the raw material export products they can sell."

Much pontification, little knowledge.
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Re: THE Saudi Arabia Thread pt 5 (merged)

Unread postby americandream » Thu 17 Mar 2016, 04:41:58

Saudi Arabia now BEGGING for billions in loans as oil crash leaves economy in tatters

http://www.express.co.uk/finance/city/6 ... in-tatters
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Re: THE Saudi Arabia Thread pt 5 (merged)

Unread postby americandream » Thu 17 Mar 2016, 04:49:03

Saudi Arabia is running out of water. Saudi Arabia has started taxing water for residents to try and address the soaring cost of debt as oil revenues decline

http://www.independent.co.uk/news/busin ... 83706.html
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Saudi Downgraded

Unread postby vox_mundi » Tue 12 Apr 2016, 08:01:24

Fitch downgrades Saudi Arabia ratings to AA-minus from AA

Fitch Ratings on Tuesday downgraded Saudi Arabia’s long-term issuer default rating to AA-minus from AA, and said its oil price assumptions have “major negative implications” for the country’s fiscal and external balances.

Fitch is expecting oil to average $35 a barrel in 2016 and $45 a barrel in 2017.

The Saudi government deficit widened to 14.8% of GDP in 2016, after 2.3% in 2014 and surpluses for the years since 2010. Fitch is expecting that ratio to narrow slightly in 2016 and a bit more substantially in 2017.

“A large share of the government’s financing needs will be funded by disposing of foreign financial assets, but the government has also started raising debt domestically,” Fitch wrote in a statement.

The government is in talks on a syndicated loan of up to $10 billion and is planning a first Eurobond issue later this year. Fitch said a continued deterioration of fiscal balances, or slower-than-expected narrowing of the fiscal deficit would be factors that could lead to a downgrade, along with potential spillover from regional conflicts.

The outlook is negative, meaning Fitch does not expect near-term developments to lead to an upgrade.
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Saudi Arabia Bombings

Unread postby vox_mundi » Tue 05 Jul 2016, 13:17:33

Saudi Arabia: Bombings target Medina and Qatif mosques

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http://www.bbc.com/news/world-middle-east-36706761

Four security guards killed at Prophet's Mosque in Medina in third attack to hit kingdom in one day.

The bombing at the Prophet's Mosque in the city of Medina was the third attack to hit the kingdom on Monday, following blasts in the cities of Jeddah and Qatif.

Photos of Medina posted on social media showed smoke billowing from a fire outside the mosque where Prophet Muhammad is buried.

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The blast struck moments before sunset prayers when people were breaking their fast inside the mosque.

The mosque, which is also known as Al-Masjid an-Nabawi, is visited by pilgrims from around the world during the final days of the fasting month of Ramadan. The mosque is considered to be Islam's second holiest site after the Sacred Mosque, or Masjid-al-Haram, which surrounds the Kaaba in the city of Mecca.

Following the attack in Medina, Muslims around the world expressed their outrage.

Iran's Foreign Minister Javed Zarif, writing on Twitter, said: "There are no more red lines left for terrorists to cross. Sunnis, Shiites [Shias] will both remain victims unless we stand united as one."

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Earlier on Monday morning, two security officers were injured as a suicide bomber blew himself up near the United States consulate in the Red Sea port city of Jeddah.

Security officers became suspicious of a man near the car park of Dr Suleiman Faqeeh Hospital which is directly across from the US diplomatic mission. When they moved in to investigate, "he blew himself up with a suicide belt inside the hospital parking", the interior ministry said.

Saudi's interior ministry identified the attacker as Abdullah Waqar Khan, a Pakistani national in his early 30s. In a tweet, the ministry said that Khan, a driver, had moved to Jeddah 12 years ago to live with his wife and her parents.

A series of deadly attacks worldwide were either claimed by, or blamed on, IS over the past week:

- A suicide gun and bomb attack targeted Istanbul airport on 28 June, killing 45 people.
- Attackers struck a cafe in Bangladesh's capital, Dhaka, last Friday night. Twenty hostages and two policemen were killed.
- A massive truck bomb in Iraq's capital, Baghdad, on Sunday left at least 165 people dead.

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