Saudi Arabia’s King Abdullah has died. Dr Matthew Partridge looks at what this means for the region and the oil market.
So, what has happened?
King Abdullah bin Abdul-Aziz of Saudi Arabia has died at the age of 90. Abdullah had ruled since 2005, and was widely believed to have made most of the decisions since his predecessor had a stroke in 1995.
As expected, Crown Prince Salman bin Abdul-Aziz al-Saud will be his successor. While Saudi Arabia has a consultative council (known as the Shure), it has very little power, making it one of the last absolute monarchies in the world. While Salman is 79 years old, and has had health problems, all experts agree that he will be fit and able to govern.
Why does this matter?
Saudi Arabia is regarded as the major superpower in the Middle East. This is partly due to its control of Mecca and Medina, Islam’s two holiest sites.
More importantly, its control of one-fifth of the known oil reserves in the world gives its enormous power over the energy markets, as well as producing huge amounts of money for the state (90% of government revenue comes from oil).
Despite the fact that it has a population of only 30 million, its inflation-adjusted GDP is $1.5trn. This allows it to fund a programme of lavish government spending, including large amounts on its army and air force.
Is anything going to change domestically?
Before his death, some had argued that King Abdullah was taking small steps to modernise Saudi Arabia, such as encouraging co-education, and even giving women some limited rights. However, others point out that Abdullah’s limited “reforms” did little to alter the kingdom’s extremely repressive laws, as shown by the recent public beheading of a woman, and the flogging of a blogger.
Salman is seen as much more cautious about reform, with his age (79) and ill health (he has suffered a stroke) suggesting that he will seek to consolidate the status quo.
What about foreign policy?
It looks like there will also be continuity in foreign policy. Officially Saudi Arabia is a supporter of the fight against Islamic State, the terrorist group that has captured territory in in both Iraq and Syria. However, there have been claims that prominent Saudis, including possibly government officials, covertly supported the group in order to prevent what they see as Iranian domination of the region.
Saudi Arabia’s feud with Iran has its roots in the fact they follow different interpretations of Islam (most Iranians are Shia, while Saudi Arabia is 90% Sunni).
Will this affect the oil market?
One of the big reasons why the price oil has dropped dramatically is because Saudi Arabia refused to cut production. Experts believe that it did this to damage the emerging shale oil and gas industries in America and also to hit the economies of Iran and Russia (which has supported the Assad regime in Syria).
While the lower price will hit government revenue at a time when there is rising popular discontent, the new government has decided to re-appoint the current minister for oil. This is seen as a vote of confidence in the current policy. While oil prices rose slightly when Abdullah’s death was announced, they are still at record low.