A well-rounded global energy policy means that a broad spectrum of countries are producing a wide range of oil and gas products. In this way, temporary distribution issues in one country do not slow down the global economic recovery, which is dependent on petroleum products. The key to this equation is Saudi Arabia. As the world’s largest oil exporter oil price stability depends on Saudi Arabia’s policy to keep prices within a band that is fair to both consumers and producers.
While visiting the Persian Gulf earlier this month, I met with a number of officials to discuss how the global economy has been affected by the recent events in the region. Higher oil prices are a net result of political and economic instability while the need for genuine reform is most likely the underlying cause of these events.
One way for the global economy to protect itself from price instability is closer cooperation between oil producing countries and consumers. This cooperation should also include partnerships with countries like Saudi Arabia, Bahrain, Israel and Qatar to develop alternative sources of energy.
Forward-looking countries like the United Arab Emirates, Bahrain and Qatar are already laying the foundations for the establishment of a green economy.
But until such time as alternative energy takes hold, the United States — and the rest of the world — will have to rely on crude oil imports for economic growth. This means that the U.S. must strike a balance between the stability of countries such as Bahrain, Saudi Arabia and Qatar and our commitment to good governance.