Monday 18 April 2011

Full: Lessons forgotten with Saudi focus on the short term - The National

One of the great myths in the oil world is that Saudi Arabia is the force for price moderation. The Saudis have played their role to perfection ever since the days of Sheikh Zaki Yamani, the urbane oil minister, in the 1970s.

The Saudis follow Theodore Roosevelt's advice to "speak softly and carry a big stick"; their stick being the world's largest oil reserves.

Conversely, the "price hawks", led by Iran and Venezuela, consistently trumpet the virtues of higher prices. In their view, the "fair price" is US$10 higher than whatever it is today. As in the old Texan expression "all hat and no cattle", they are content to talk big.

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