Reflections on oil and autocracy in the Middle East.

After the 1973 international financial crisis, the oil producing countries formed OPEC in an attempt to control their prices and increase their share of the surplus resulting from oil production. Indeed prices increased and huge profits accumulated to the producers. Contrary to hopes for the opposite, this increase surplus did not change the realities for the peoples of the region or the understandings between the West, the local elites and the oil Companies. In Saudi Arabia for example, the tacit understanding was that the Saudi Kingdom benefited from the enormous profits, the American companies continued “to enjoy a privileged position in their relation with the oil industry”, and the US continued to enjoy its strategic position in the country. The US also benefited from the growth of the Saudi economy, as the latter fueled demand for consumer goods and American investment, as well as weapons procurement that required training by American experts. Throughout the Middle East, the oil price increases led to little or no increases in the wealth of the people of these societies. None of these countries had been a democracy, and the increased flows of revenue strengthened the predispositions of the Middle Eastern states towards centralization. Thus, states became stronger and more repressive, new state structures emerged and the elites became harder to remove. Instead of a share of the increased revenues flowing to the people of the Middle Eastern countries, it “ended up supporting a vast system of patronage and corruption that upheld” the dominant class. States grew larger and “dominated the society and economy”, while “blotting out in many cases the possibility of real steps toward a more open society”. The oil revenues also resulted in increased dependency of the citizens to the state and of the state to external patrons. The former for more handouts or access to power and the latter for protection against the local rivals and for weapons procurement.