Abstract: Oil as Instrument of Development and Foreign Policy: "An Arab View"

By

Abdulrahman al-Zamil

Traditionally oil has been the source of funds needed for socioeconomic development. Producing countries, for many reasons, did not wish to jeopardize this vital source of income. But the political circumstances at long last forced the Arab producing countries to use it as an instrument of foreign policy. Oil's new role was spelled out by HM King Faysal in 1974 when he stated, "Production decisions are not at all compelled by my country's revenue needs; every added barrel of production might then be viewed as a sacrifice of my country's resources to serve the energy needs of the oil-importing world, and thus I shall expect something in return."

Oil in its new role was used mainly as a sanction against those opposing the producing countries' national goals and aspirations and also as a means of granting preferential treatment to friendly nations. The action very clearly brought home to everyone (including those producing countries that did not take part in this action) how effective a leverage, short of force, oil can provide in obtaining national goals.

The lecture discusses the impact and implications of this action for both the producing and consuming countries: whether or not the producing countries will use oil again in the same manner; whether or not the consuming countries will be ready and able to accept it; and whether or not oil ever will be liberated from politics and play only its traditional role as the earner of funds.

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