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Saudi Strategy, Monarch's Health Affecting Global Price Of Oil

Saudi King Abdullah talks with newly appointed Saudi Crown Prince Salman bin Abdel-Aziz in Taif June 19, 2012. Saudi Arabia's King Abdullah has appointed his defence minister, Prince Salman, as heir apparent, opting for stability and a continuation of cau
Saudi Press Agency
/
Reuters

Oil prices continue to fall, down to around $50 per barrel this week, and Saudi Arabia has reportedly asked OPEC members to continue production in order to keep prices low.

It’s working, for them, because they have $750 billion in reserve currency, and will likely gain market share in the long term as it becomes expensive for others in the region to produce oil. But Joshua Landis, the Director of the Center for Middle East Studies at the University of Oklahoma, argues that American oil companies play a significant role as well.

“It’s the Americans who’ve done this to the world through [hydraulic fracturing],” Landis says. “This new technological innovation has allowed America to become the major producer of oil in the world. We’ve flooded the market, and now we’re expecting the Saudis to reduce their production in order to keep the prices high so Americans can get rich.”

Saudi Arabia’s oil strategy also depends on the health of its leader. 90-year-old King Abdullah has been ill, and some analysts attribute a Twitter death hoax earlier this week to a spike in oil prices.

“The United States is anxious because we don't have many friends left in the Middle East that we can really count on, and we've been counting on the Saudis,” Landis says. “So on top of the Arab Spring, our struggles with Iran, means another big question mark in the Middle East, and we need stability in the Gulf.”

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Brian Hardzinski is from Flower Mound, Texas and a graduate of the University of Oklahoma. He began his career at KGOU as a student intern, joining KGOU full time in 2009 as Operations and Public Service Announcement Director. He began regularly hosting Morning Edition in 2014, and became the station's first Digital News Editor in 2015-16. Brian’s work at KGOU has been honored by Public Radio News Directors Incorporated (PRNDI), the Oklahoma Association of Broadcasters, the Oklahoma Associated Press Broadcasters, and local and regional chapters of the Society of Professional Journalists. Brian enjoys competing in triathlons, distance running, playing tennis, and entertaining his rambunctious Boston Terrier, Bucky.
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