Saudi Arabia as a "swing oil producer" in the first half of the 1980s

Abstract

The dissertation examines Saudi oil policy, focusing mainly on the first half of the 1980s. In this period, Saudi Arabia played a "swing producer" role to control oil prices in the world oil market. This behavior of Saudi decision-makers can be understood within the economic framework of the "dominant producer" model. After interdisciplinary research on previous political and economic studies of Saudi oil policy, the dissertation concludes that the basic notion of Saudi oil policy as a "swing producer" was intended to meet Saudi Arabia's long-term political and economic interests. It was therefore logical for Saudi officials to implement the oil policy of "swing producer" to maximize the long-term economic value of Saudi oil, since this would also contribute to the political consolidation of the Saudi regime. However, there are several questions still remaining in the details of this oil policy. In contrast to the argument of the "dominant producer" model, why did Saudi Arabia try to achieve relatively high oil prices at the expense of its already reduced market share during this period? If Saudi oil policy as a "swing producer" was derived primarily from the state's long-term economic interests, why did it suddenly give up this role in the summer of 1985? To answer these questions, it was necessary to examine Saudi oil policy since December 1976, because it was at this point that the state began to implement an oil policy based on its national interests. After a comprehensive study on Saudi oil policy during boom and slump periods, I have identified the main priorities of Saudi oil policy in these two different periods, and have tried to draw a conclusion that provides the readers with plausible answers to the main questions in my dissertation.