Market Insider

Don't confuse Saudi Inc with Saudi Arabia

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Future of Saudi Arabia

After years of building a glut, the world's oil industry by the end of this year is expected to stop overproducing more crude than the world can use.

But analysts say one wild card in that equation is Saudi Arabia — the producer that at one time was most likely to bring balance to the world oil market, using the flexibility of its spare capacity. That role has changed and so has that country's mission, as it attempts to transform its economy and oil industry into a global financial force, not just a force in world energy markets.

"We should start thinking about Saudi Arabia as producing more like an oil company would," said Citigroup energy analyst Eric Lee. "They have some of the cheapest, lowest-cost oil production in the world so they would hope to develop that and invest in that."