What Happens to the American Economy When the Saudi Government is Toppled?

Question

In the hypothetical scenario that the Saudi Arabian government is toppled in a coup, what kind of impact would this have on the United States economy and how could the U.S. make up for the loss in Petroleum imports?

Answer 1

first, US got oil reserves that will last 30-50 years. We do not use them b/c oil is high but not that high.

Second, if some wild group manages to remove Saud family from control of the country, there's a good chance that OPEC will collapse, increasing oil output and reducing price.

Finally, even if new regime manages to keep OPEC intact, they still need money, so they will be selling oil to somebody. So total oil output will not change much, and markets will adjust to redistribute supplies and everything will stay the same.

Answer 2

If it did not disrupt oil production, not that much would change, because we buy our oil in the world market. More likely that not political unrest in Saudi Arabia would effect production. There is no way to make up for the lost production because world oil production is near capacity now so prices would rise as the world bid for the remaining oil on the market. We have emergency reserves, but only enough for a few months. You have only to look back at the 70's to see the negative impact of oil shortages have on our economy.

Answer 3

The reason the Saudis are our buddies is because they have agreed to price their oil in American dollars, as did most of the oil producing nations for many years.When this started the American dollar was backed by Gold.

The hidden reason the U.S. started a war in Iraq is because Saddam had started to accept Euros for oil instead of dollars.

Very slowly, so as not to cause a panic, other oil producing countries are cutting the use of dollars for oil......that is the cause....the affect we can see is at the U.S. gas pumps.....As the dollar loses value the price of gas goes up in dollars.......Which in turn is going to raise prices on every product that's dependent on dollars.

A solution that nobody is going to pay any attention to!

Congressman Ron Paul, a former member of the U.S. Gold commission, is running for President.
He is an expert on the economy and the use of Gold as money.
He's a long shot, but if by some miracle he gets elected,,,,if he doesn't get killed, his Constitutional policies could///would save the nation,,imho.

Check out:

http://groups.yahoo.com/group/RonPaul2008/

Thank You!