15 Charts That Should Terrify Saudi Arabia

hillary clinton saudi arabia

Billionaire Saudi Prince Alwaleed has sounded the alarm about the threat shale oil and gas development poses to the petro-kingdom’s barely diversified economy. 

It’s taken a while for such a prominent Saudi to acknowledge this fact.

But it’s been pretty clear to the rest of the world.

In March, for instance, Norway’s foreign minister said America’s shale boom could rearrange the Middle East’s balance of power.

Then in May, the vice-president of Bahrain-based Nexant Middle East told the FT’s Ayesha Daya that the kingdom’s proposed petrochemical investments would miss the mark:

The shale gas boom has returned focus to the US. So it’s reasonable to suppose that some companies, especially those from the US, won’t develop additional projects in the Middle East as they look to spread their geopolitical risk and invest in the US.

The kingdom still rules the oil world in major production stats: production(11.2 million barrels a day), exports (8.5 million barrels a day), and largest oil deposit (the Ghawar field at an estimated 70 billion barrels).

But with the help of some charts from AEI’s Mark Perry, who’s been chronicling America’s energy boom better than anyone, and the now-instant classic note, “The End Is Nigh [for rising oil demand]” from Citi’s Seth Kleinman and Ed Morse, we bring you 15 charts that should scare the crude out of the Saudis.

Saudi Arabia needs high oil prices to function — Below $80 and the kingdom starts getting into trouble. There are some trends that could easily push prices must lower.

But oil's share of the world's energy mix is falling. Meanwhile, gas's is rising.

That's because lower gas prices, thanks to growing supplies, prompted people to use more of it.

Saudi Arabia is not the Middle East's big gas player. Iran is.

Meanwhile, the world needs less and less oil to grow.

Fuel economy is on the rise in America. And better fuel economy is also coming to other countries, where new regulations will come into effect.

So oil demand is flatlining.

Even in China, oil demand is stalling.

The Saudis may still lead in oil production, but the U.S. is gaining fast.

Saudi oil exports to the US have yet to recover from last decade's highs.

Texas alone now ranks as 13th-largest oil producer in the world.

Last year, we were more energy self-sufficient than we've been since 1991.

US production will soon outpace imports. That hasn't happened in nearly 20 years.

The EIA recently revised upward its estimates for recoverable oil thanks to fracking.

But we may not even need it in the coming decades, as renewable energy rises.

Want to drill deeper into the shale boom?

NOW WATCH: Money & Markets videos

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.