I Fought AgainsThe Bottle But I Had To Do It Drunk -- The Saudi Paradox -- April 9, 2021

I see WTI is down again today; Saudi Arabia can't make it on 6-handle oil.

Talk about "cognitive dissonance" for a kingdom that continues to live in the Middle Ages.  Reuters contributor writes:

In order to wean Saudi Arabia off its dependency on crude the kingdom needs higher oil prices.

Sort of like Leonard Cohen saying

I fought against the bottle, but I had to do it drunk. 

LOL.  

From Reuters: 

A multi-trillion dollar spending push designed to diversify the economy's sources of income will require state companies to cut the dividends they pay the government to boost capital spending, Crown Prince Mohammed bin Salman has said.

It is not clear how much companies like oil group Saudi Aramco - whose $75 billion dividends last year were vital to support state revenues - would cut their dividends, but any reduction would likely need to be compensated by higher oil prices, analysts say.

"If dividends are lowered, a higher oil price would boost Aramco transfers to the sovereign through taxes and royalties instead," Jean-Michel Saliba, MENA economist at Bank of America, said in a research note.

This leaves crude revenues at the centre of the kingdom's strategy targeting 27 trillion riyals ($7.2 trillion) in domestic spending by 2030.

A reader sent me the link to the story. My not-ready-for-prime-time reply:

Every story I read along this line, these are the recurring themes I see:

• Saudi Arabia is in deep trouble;
• Saudi Arabia is confused; not sure what to do in a free market; doesn't dare cede global market to others: US, Iran, Russia.
• that $75 billion dividend is a huge problem for both Aramco and the state; Armaco can't get rid of it fast enough; the state won't let it go. It would be interesting to see how that $75 billion is spent; who benefits from it; rich princes or others?
• articles in the US spreading disinformation on fracking, pipelines are certainly funded by Saudi Arabia
• renewable energy provides low margin returns; nothing like the margins in oil;
• Saudi Arabia can build all the refineries they want but those refineries are a long way from the countries that use refined products; countries that use refined products have more than enough refineries: the EU; China, India, the US;
  
• it may be good "PR" to talk about building refineries in Saudi Arabia, the fact is they are also low margin, and are thousands of miles away from consumers;
• refineries become targets for terrorists.