According to recent
information, Saudi Arabia is raising their gas prices by about 50%. SA is known
for having some of the cheapest gas in the world at 24 cents a gallon. This was
raised from 16 cents a gallon and has impacted a lot of people. Many people of
SA lined up to fill up tanks of gas before the price rose.
The SA people actually
have a surprisingly large amount of government benefits that are given to them.
Some include things like free health care, and unemployment assistance. Of
course the social aspects of the country are still heavily controlled by the
government, but on a strictly economic standpoint, the country has some boons
for its citizens. One of the greatest accomplishments is the fact that 90% of
the people are employed by the government, and some of the remaining are
employed by private sectors.
With the price of gas
having fallen from 100 a barrel to 34 a barrel, experts believe the country
will run out of funds within the next five years if something does not change, because
without their main export (crude oil) the country has little else that it makes
money from. Also since many of the people are employed by the government, if it
loses money, people will be out of jobs as they cannot be paid.
SA
and Iran are constantly in competition over gas exportation. However both
countries are militant countries and are at odds with each other. The recent
execution of a Shiite cleric also brought tensions to a head between the two
countries and the gas competition did not help matters at all. The relationship
between military and economy is a strong one in the Middle East and has caused
problems for a long time.
Due
to the continuing price drop of oil, both countries are having a difficult time
making enough money to support the people and innocents are losing money and
the already low standard of living in these countries is dropping lower and
lower. Also neither country seems to have any desire to work with the other so
very little is even being done between two of the biggest oil exporters in the
world.
Another
problem is that both countries are accelerating their production of crude oil. And
supply seems to be greater than demand for the world at the present time which
is contributing to the falling prices.
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