Oil conservation and economic development in Saudi Arabia

Thesis/Dissertation · Sun Jan 01 04:00:00 EST 1984

OSTI ID:5157753

Shams, M M

This dissertation is to discuss and recommend an appropriate oil-conservation policy for Saudi Arabia in the light of past, present, and future economic development plans. The basic concept is the fact that oil is a depletable resource representing over 95% of Saudi national income. Two exogenous constraints face the government in its efforts to develop an efficient conservation policy. The first is the membership of Saudi Arabia in the Organization of Petroleum Exporting Countries. The second is the world energy market. These two constraints hinder the ability of Saudi Arabia to use an appropriate social rate of discount to allocate oil revenues efficiently. Using social rate of discount implies that Saudi oil reserves would be allocated over time according to a rate that reflects the Saudi society's time preference. A high discount rate means that oil production would be pushed from the future to the present, whereas a low discount rate means that Saudi Arabia prefers producing oil in the future rather than in the present. A strategy based on social rates of return on domestic and foreign investment seems to be appropriate for Saudi Arabia. But the existence of the exogenous constraints and also events of 1983 and 1984 in the domestic economy and world energy market impose restrictions on using discount rate. It is appropriate for Saudi Arabia in the meantime to deal with the deteriorating situation in the world energy market.

• Research Organization: Texas Univ., Austin (USA)
• OSTI ID: 5157753
• Country of Publication: United States
• Language: English

Related Subjects

02 PETROLEUM
020700* -- Petroleum-- Economics
Industrial
& Business Aspects
29 ENERGY PLANNING, POLICY, AND ECONOMY
290200 -- Energy Planning & Policy-- Economics & Sociology
290400 -- Energy Planning & Policy-- Energy Resources
294002 -- Energy Planning & Policy-- Petroleum
ASIA
ECONOMIC DEVELOPMENT
ENERGY SOURCES
FOSSIL FUELS
FUELS
GLOBAL ASPECTS
INTERNATIONAL ORGANIZATIONS
MARKET
OIL-EXPORTING COUNTRIES
OPEC
PETROLEUM
RESERVES
RESOURCE CONSERVATION
RESOURCES
SAUDI ARABIA