Saudi Arabia should not underestimate the slate revolution danger as it could lead to a revenue contraction of the countries that are too much reliant on crude material exports. Saudi Prince Al-Waleed bin Talal, the wealthiest Arab according the Forbes ranking, highlighted the idea in the open letter addressed to Ali al-Naimi, the country’s oil minister. The letter’s link reference in Google Docs was posted in Al-Waleed’s twitter for public access.
The letter dated May 13 was sent out to a few more ministers and to King Abdullah. However, the letter appeared on open access only on July 27. The Prince’s spokesman confirmed its authenticity to the Financial Times. An undisclosed Saudi official told The Wall Street Journal that the ministers had received the letter.
In his message, Al-Waleed appealed to the Saudi Arabia’s authorities to lower the dependence on exporting raw materials and to start investing in alternative energy sources. In the letter, Prince mentions that in 2013, 92% of the country’s budget accounts for the proceeds from oil sales.
According to his letter, in case Riyadh keeps on defying the slate revolution danger, the crude material demand will sink and consequently, fiscal revenues will drop.
Previously, Saudi officials including the oil minister stated more than once that oil and gas production from the slate rock does not threaten the country’s welfare. Meanwhile, some other members of the Organization of Petroleum - Exporting countries (OPEC), such as Algeria and Nigeria have already brought down the exports to the US due to damping demand. Last year, the US cut down purchasing oil from the OPEC to the 15-year minimum volume.
Based on the results of 2013, the OPEC forecasts that the demand on the crude oil of the multicorporate enterprise is going to decline by 600,000 to 29.6 million barrels per day . The cartel links such downturn with the growing production of the crude oil in other countries that are not included in the OPEC.
In the US, the slate revolution has encouraged the booming gas and oil extraction. Forecasts from various sources tell that by 2020-2025, the US is likely to have come out on top concerning the raw produce and gasoline production. The large-scale surge in crude extraction was recorded in the US in 2012 – the production output rose by 779,000 to 6.4 million barrels per day. Analysts from Harvard Kennedy School expect that the US will have been able to raise the oil output to 16 million barrels per day by 2017. In comparison, currently Saudi Arabia’s production capacities enable to yield maximum 12.5 barrels per day.