[LINK] "Saudi Life With $30 Oil"

[rfmcdonald]

Donna Abu-Nasr's Bloomberg article notes how Saudi Arabia is beginning to adapt, again, to low oil prices. Can it adapt successfully?

Times are getting tougher in the Hathut household, so father Mohammad is looking for extra work and the three kids are being told to switch off the lights to cut his electricity bill.

This is Saudi Arabia in 2016. It may be a familiar story to austerity-hit Europeans and Americans, but in a nation synonymous with conspicuous consumption, the belt-tightening has been unsettling. Unprecedented cuts to fuel and energy subsidies are forcing the kind of rigor never seen during the era of petrodollar-fueled wealth that quadrupled per-capita income since the late 1980s.

“A lot of things will change,” said Hathut, 30, who plans to supplement his income as a business-administration teacher at a Riyadh university with private training sessions. “But many youths are still in
a state of shock. They haven’t processed the news and what to do.”

With oil having plunged to about $30 a barrel, signs of the tectonic shift taking place in the ultra-conservative Islamic kingdom are everywhere: from the royal palace where the nation’s founding family is contemplating the sale of its monopoly oil producer to the homes and businesses adjusting to the new economy.

Those aged 15 to 34, who make up more than 40 percent of the 21 million Saudis, are at the forefront of the upheaval. No longer can they take for granted free health care, gasoline at 20 cents a liter and routine pay increases.

Even the power of the religious police, which upholds the strict brand of Islam that defines Saudi Arabia, may no longer go unchecked by the government. The Consultative Council, an advisory body, last month urged the Commission for the Promotion of Virtue and Prevention of Vice to compile a list of banned behaviors to prevent abuse by officers. They can arrest unmarried couples found together in a car or people caught with flowers on Valentine’s Day.