Introduction

In projecting the position and influence of the Gulf countries in the international society, examining the political power of these countries is a necessary step. According to traditional categorization, a country’s political power can be broken down into military power, economic power, and power over the opinion.1 Among the three categories, economic power which is mainly generated from their oil revenue is the very source of Gulf countries’ political power. Gulf countries can exercise unique diplomatic influences by such revenues. Gulf countries’ sovereign wealth funds, which are mainly funded by oil export revenues, generates additional such influences through investments to various assets and projects abroad. Oil revenues provide essential funds to enable national integration through generous social spending and subsidies. Oil export revenues in Gulf countries itself seem to have peaked in 2012, and uncertainties over the future revenues have been growing (Fig. 1). Examining how these export revenues will flow to the countries and what are the likely threats to the revenues in the future, therefore, will provide a good guide to project the future power of the Gulf counties.

In light of this interest, this paper considers that Gulf countries face three potential threats that may affect the future revenues of oil in Gulf countries, namely, 1) the shale revolution that is underway, centered on North America; 2) the “Arab Spring” that swept through the Middle East region in 2011, and, 3) expanding energy demand and energy shortfalls within the Middle East. The paper then argues that shale revolution will not have a significant impact on the Gulf oil export revenues; but change of crude oil trade pattern and “energy independence” perception in the US may affect geopolitical environment in the Gulf. The “Arab spring” did not cause a large scale supply disruption while raising international crude oil price level; but, situations in Syria and Iraq has a potential to cause a serious disruption. Increased social spending and raised targeted crude oil price caused by rapid demand growth is also a source concern for Gulf countries. Section 1 to 3 discuses these three potential threats, reality and likely impacts to the future revenue amounts, and Section 4 concludes the entire discussions.