ABSTRACT
The view that Saudi Arabia has suffered a major decline in its geoeconomic power is reinforced by the fact that the country's swing producer status, and thus the country's ability to influence oil prices, has been transferred to US shale producers. This chapter argues that the conventional view of declining Saudi Arabian geoeconomic strength capable of securing short-run gains in oil prices, revenues and regional stability provides an incomplete depiction of reality. In its place, a new geoeconomics of energy is developed. While recognizing the short-run elements of national power emphasized by the conventional geoeconomics, the new geoeconomics stresses the ability of a country to pursue policies in its long-run interest even when it appears to be losing its short-run geoeconomic leverage. In contrast to the conventional assessment of Saudi Arabia's geoeconomic decline, the new geoeconomics, by considering geoeconomic power from an inter-temporal perspective, contends that recent developments in world oil markets have temporarily enhanced Saudi Arabia's geoeconomic power.
