Saudi Arabia: Cloud Over Exports
Photograph by Amr Nabil, AP
Buses
jam an intersection near Arafat outside Mecca during the annual
pilgrimage that is a sacred duty of the Muslim faith. Not just at the
hajj, but throughout the year, fuel is burning in Saudi Arabia at a
growing rate.
While in all other parts of the world, energy
consumption per unit of GDP has declined over the past 30 years, Saudi
Arabia's energy intensity growth rate has tripled since 1980-its economy
is growing less efficient.
And it's no wonder, because—as in many high-subsidy countries—a
gallon of gasoline costs less than a bottle of water here. Of course,
Saudi Arabia, as the world's largest oil exporter, sees state revenue
soar when the global price of oil rises. But so, too, does the amount of
foreign income it forgoes as it provides cut-rate fuel for its
citizens; its subsidy bill was about $44 billion in 2010, says IEA.
Because
oil is so cheap, it is used in large volume for electricity here-an
inefficient and polluting practice that most countries have tried to
abandon.
