The increasing use of renewable energy sources will likely make a substantial dent in the demand for hydrocarbons in coming decades, which in turn would result in low prices for oil and natural gas. If the world does turn primarily to renewable energy, the hydrocarbon producers the Arab/Persian Gulf, which export some 20 million barrels a day of crude oil, would suffer a drastic fall in revenues, leaving them unable to balance their budgets, pay for their infrastructure projects, and provide the extensive social benefits that their populations have come to take for granted.
Such a decline in income could greatly reduce the importance of the Gulf states in world affairs and cause many of their allies to re-evaluate their relationships with them. This is particularly true for Saudi Arabia and its close relations with United States. The US-Saudi relationship has often been defined as based on “oil for security”; the security of Saudi Arabia and of the US oil companies active there are protected by US military power. Furthermore, this unwritten pact seems to include American support of the royal family of Saudi Arabia and to enshrine the notion that the United States will guarantee the freedom of navigation that allows Gulf oil to flow out of the Middle East and US goods to flow in.
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