Are Saudi Arabia and other Gulf oil states dying of “green energy” paths?
The first signs of contempt by the new US president, Joe Biden, for Saudi Arabia were evident by his refusal to supply weapons for the war in Yemen. Are these just minor details or are there other political reasons for the long-term coldness of US-Saudi relations?
Humanity is gradually moving towards the abyss of the largest economic crisis it has faced in centuries. It is a crisis of overproduction, as well as the crisis of the end of the current technological cycle. With current technologies, it has become impossible to raise the level of human consumption above the current level. And each time, the exit from the crisis was linked to the transition of humanity to a new level of technology, as happened before in the transition to textile factories, the steam engine, the internal combustion engine, electricity, and others. This led to the emergence of new industries, and with them a new investment cycle. But the crisis and recovery from it may take decades.
Now, there is no longer a place to invest, and there is not much actual demand around the world to purchase all the goods produced. A large part of global production must go bankrupt, which will accompany the collapse of the United States of America and the European Union and the transformation of the center of the world economy over the centuries to come.
The problem is that there are still no scientific and technical breakthroughs that would lead to a significant increase in productivity.
Under these circumstances, the “masters of the world”, the elites of the American globalization project, are trying to fabricate such industries intentionally, hoping to delay the death of the Western project of globalization in this way.
In fact, such new industries do exist, but they do not provide for the transition to a higher level of efficiency and productivity, on the contrary, they are less profitable.
Under Presidents Obama and Trump, there was shale oil and gas. As of 2016, these industries accounted for 45% of all investment in the United States of America, and thus these industries provided half of the total economic growth in the United States. However, with the drop in oil prices, much of the industry is no longer profitable. Further expansion has come into question. Indeed, the depletion of this project contributes significantly to the current US economic decline.
But the western elites were guided to a new project, which is “green energy”. They even prepared a special project under the name “Greta Thunberg”, which should become a symbol of the struggle for a bright and environmentally friendly future, to which “green energy” is supposed to lead.
Except that everything is not so simple. Recently, publications have surfaced claiming that as investments increase, solar and wind power generation will become more profitable than nuclear and other “unclean” energy sources. This is questionable information, not to mention that not all countries have the conditions needed to generate solar or wind energy. But, in any case, the transition to “green energy” requires trillions, or even tens of trillions of dollars, which no one has at the moment.
But hey, central banks in the West (the USA, Europe, Japan, Australia … etc) last year one, according to some estimates, worth $ 14 trillion worth of uncovered money.
While this money is traded on global exchanges, the West uses it to buy real goods and raw materials from developing countries. In short, there is a redistribution of profits in the context of neocolonialism.
But that same money, or even tens of trillions of new uncovered new funds, could be directed to generating “green energy” in the West. Central banks in Europe will print the money needed for that process.
As for the rest of the world, which will accept these dollars, euros and yen in exchange for goods and raw materials, it will pay for the West’s transition to renewables. At the same time, and as expected, this should trigger a new investment cycle that leads the economies of Western countries out of the crisis.
However, as I mentioned, a number of experts say that generating such “clean” energy is still not profitable compared to traditional “unclean” energy sources, such as nuclear power, gas and even coal. Products that are to be produced using “clean” energy will be more expensive than their “dirty” counterparts.
That is why the West plans to impose additional duties on goods from other countries, under the pretext that these countries use “unclean” energy sources, and are not fighting for the environment with “Greta Thunberg”.
To achieve this goal, the most beautiful excuses and the loudest excuses can be made, but they should not be misleading, for we are talking here about vulgar and dishonest competition.
The European Union has already announced such intentions, and after the victory of Joe Biden, the supporter of globalization, the United States of America is expected to join that chorus soon.
Where would Sudan or Morocco, for example, get tens of billions of dollars to switch to solar energy? It is clear that the goods of most Arab countries will be subject to additional fees.
One way or another, fossil fuel exporting countries will fall under a double whammy. On the one hand, the West will reduce the consumption of the raw materials they extract, which will lead to lower energy prices, and will also withdraw part of their profits by imposing a tax on goods produced outside the West.
Of course, Saudi Arabia and the oil-rich Gulf states will be at the forefront of those affected, as the economies of these countries are overly dependent on energy prices, and the Gulf will search for new consumers.
I have previously written that any union between the Gulf states and China is an ideal marriage from an economic point of view. I think that China will be ready, within 10 years, to increase its imports of fossil energy resources, but Washington cannot allow the Gulf to move into the grip of China.
And if I was previously talking about this conflict as a remote possibility, after the victory of globalization in the recent elections in the United States of America, that conflict has become on the agenda of today and tomorrow. I expect an intensification of the Sino-American conflict over Gulf oil and a greater complication in US-Saudi relations in the near future, during the term of US President Joe Biden.
Political analyst / Alexander Nazarov
The article expresses only the opinion of the newspaper or writer