{
  "id": 14434576,
  "title": "It’s a different oil crisis, but Saudi Arabia will still pay",
  "url": "https://urgent.news/2026/10/14/its-a-different-oil-crisis-but-saudi-arabia-will-still-pay",
  "topic": "business",
  "section": "Business",
  "published": "2026-10-14T11:21:46.000Z",
  "source": {
    "name": "Semafor",
    "slug": "semafor",
    "url": "https://www.semafor.com/article/10/14/2026/its-a-different-oil-crisis-but-saudi-arabia-will-still-pay"
  },
  "original_language": "en",
  "account": "In July 2008, Saudi Arabia attempted to quell the soaring oil prices by announcing a slight increase in production and proposing measures to curb speculation and speculators. However, less than three weeks later, the price of crude reached a staggering $147 per barrel. This week in Riyadh, a similar gathering of ministers took place with Prince Abdulaziz bin Salman at the helm. The situation this time is different, and his response is also distinct. Initially, the focus was on speculation, with Saudi officials asserting that investors were driving prices far beyond the supply and demand, while Washington pushed for OPEC to increase output. Riyadh, in turn, refused to expand capacity for non-existent buyers. Now, the issue at hand is geographical. Gulf crude is blocked by the Strait of Hormuz, and Saudi Arabia's answer to this predicament is to expand its infrastructure. Prince Abdulaziz informed the World Petroleum Congress that they might increase their East-West pipeline capacity from around 7 million barrels a day to 10 million within three years, emphasizing the importance of international involvement to protect the line. However, both responses reveal that Saudi Arabia cannot resolve the crisis on its own and ultimately pays for its attempts. In 2008, Saudi Arabia built extra capacity that has since been left unused, and now a new pipeline will follow a similar pattern. When the war ends, it will not run at full capacity, and Riyadh will maintain it as a safety net. The oil market has evolved since 2008. While OPEC was dominant then, consumers have turned to alternatives like electric vehicles. Neither a substitute nor a higher price has eliminated the demand for oil. The primary difference this time is the United States, which has abundant oil reserves and may not feel the impact of price spikes on the pump. If America relied on OPEC barrels as much as it did in 2008, the political landscape of this crisis would be significantly altered. Geopolitical risk has been the main driver of $100 oil this year, with shipping and insurance accounting for more than a third of the global crude benchmark's price. Even if the Hormuz is opened tomorrow, the new logistics of transporting crude will affect producers and change the state-to-state relationship. Iraq plans to construct a pipeline through Syria to the Mediterranean, while Kuwait and Qatar may seek ports outside the strait. Ultimately, the majority of the bill will be paid by the same entity: Riyadh. The kingdom has borne the cost of a largely idle pipeline for decades and will soon have to resume its role as the global swing producer, ensuring fair pricing for producers, covering the costs of new infrastructure, and maintaining reasonable prices for consumers.",
  "summary": "The kingdom remains the global swing producer. But the US is no longer beholden to OPEC, shifting the diplomatic calculation.",
  "key_points": [
    "Saudi Arabia expands East-West pipeline capacity to 10 million barrels/day within three years",
    "Gulf crude blocked by the Strait of Hormuz, prompting infrastructure expansion",
    "United States with abundant oil reserves may not feel impact of price spikes on the pump"
  ],
  "editors_take": null,
  "illustration": null,
  "coverage": {
    "outlets": 1,
    "also_reported_by": []
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}