In a move worthy of Michael Corleone of The Godfather movie fame, the 32-year old crown prince of Saudi Arabia, Mohammed Bin Salman, consolidated his power, over the weekend, by trotting a tried-and-true method of vanquishing political rivals in a monarchy: charge them with corruption.
This move changes the set up in the kingdom. Power used to be shared among the several descendant children and families of the former King Abdullah. Now, power is wholly within the grasp of the Bin Salman branch.
It was shocking to see the familiar face of billionaire investor Prince Alaweed Bin Talal get caught up in the purge, but you had to know something was amiss for him when he failed to attend any of the "Davos in the Desert" festivities last week.
The conference, Future Investment Initiative 2017, was a who's who of international finance, and it was the articulation of the crown prince's vision for the future of the kingdom. The presentation was replete with high stylized presentations and the announcement of a futuristic $500 billion business city called Neom.
In order to achieve these lofty goals, the crown prince is going to need a lot of investment capital, and low oil prices, below $50, are not part of the planning.
The Saudis led the charge to get OPEC members and Russia to limit production to alleviate the global supply glut, and even reduced their own output more than required. Initially, while production volumes were reduced, exports continued apace, but the Saudis awoke to that issue. They have steadily decreased export volumes this year, especially to the U.S.
