Gulf states: The joy and curse of oil wealth

In no other world region does the commodity oil play such a dominant role as on the Persian Gulf. With the oil they exported in 2004 the Gulf states could satisfy Europe’s entire oil consumption. Their pre-eminent position is further underpinned by their formidable oil reserves, which make up almost 45 % of all known oil deposits. What is more, production costs are extremely low in comparison to other oil-producing regions. And what does the future hold? We present three scenarios.

Despite the dominance of black gold, the Gulf States are endeavoring to diversify their economies and focus as well on other sectors. The region’s geographical location between Europe and the dynamic Asian economies is bolstering these efforts. What is the outlook for the next five years? Will the Gulf states be able to place their economies on a broader footing and thus curb the dominant role played by the oil price. What role can and will economic policy play in boosting prosperity above and beyond oil production? And what will this mean for economic ties with the EU and Germany?

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