The Economist Fallacy Argumentative Report: “The Era Of Oil For The Arab Gulf States Is Over”

Summary

• The Economist magazine published a fallacy argumentative report with a title: “The era of oil for the Arab Gulf states is over”.
• Engineers work before facts while economists work after facts. Simply engineers make facts such as constructions but economists explain rational.
• To link this report with a similar previous report in October 2003, the Economist published “The Oil Age Ends”.
• We are here in 2020 while that previous report proved wrong, hence and based on the 2003 fallacy argument for the Economist.
• This makes the economist in a need to read facts well before publishing reports that may touch its credibility.
• Saying so, the Economist didn’t differentiate between the decrease in provisional demand due to a pandemic, and the corona and the structural decline of the outlook.

The Economist magazine published a fallacy argumentative report with a title: “The era of oil for the Arab Gulf states is over”. The report claimed that the end of the Arab world’s oil age is nigh. The era of oil money is ending.

Consequently, as claimed, the result will be painful and there is no yet a backup plan! In its report, The Economist said, "There is an opportunity to move away from the era of hydrocarbon energy as the Arab producing nations are now facing a situation with which they cannot bridge the budget deficit, and they are required to adapt to the new situation."

The Economist referred to the fall in oil prices after the comprehensive lockdowns amid the outbreak of the corona virus," expecting that "the resources of oil producing countries will decrease to half of what they obtained in 2019."

The Economist pointed out that the International Monetary Fund “IMF” expects a contraction of the economies of these countries by 7.3%, even after the decline of the pandemic, noting that the reason is "overcrowding in oil supplies", which will lead to lower oil prices.

To link this report with a similar previous report in October 2003, the Economist published “The Oil Age Ends”, at that report, OPEC+ collaboration was about to end, while in this report, OPEC+ is showing a historical unity and consensus to bring market into balance.

We are here in 2020 while that previous report proved wrong, hence and based on the 2003 fallacy argument for the Economist, this 2020 article is more likely to be proven wrong again after 17 years.

Objectivity in the discussion of opinions disappears when a matter of Saudi affairs is touched upon, as the subject article is most likely adopting the previous one’s perspective, which is based on poor argument and unrealistic outlook.

Saying so, the Economist didn’t differentiate between the decrease in provisional demand due to a pandemic, and the corona and the structural decline of the outlook. If it is true that the peak of oil demand is close, or as someone suggests that we may have already seen the peak oil demand in 2019 sooner than expected after the pandemic won’t lift up oil demand outlook.

Then it is obvious that the reporter is either confused or trying to confuse readers of the temporary effect of the Corona virus on the global oil market, and the end of the oil age. But it is totally unfeasible to link a slower global economy amid the pandemic if the global consumption contract or plateau.

Oil prices have been stabled for more than 2 months with Brent price hovering above $40 per barrel, which means that the level of oil prices enables a gradual recovery for the economy, which does not support the Economist illogical repot.

As for the 2030 vision, it is continuous and if some of its programs are slowed down with the pandemic, which is normal as all the projects around the world but in Saudi Arabia it has not been completely canceled like other nations.

We have seen the closure of many sectors and business all over the world, not only in Saudi Arabia. In addition, there international closures have been from non-producing nations, which means the impact on the industrial nations occurred as well as the oil producing nations. Bearing in mind the Saudi vision 2030 have proved huge effective successes in diversifying its economy and lessen the dependence on oil income.

It is safe to argue here that it is premature to bring up the peak oil theory or link it to the pandemic, because the oil is till needed and all outlooks shows that there are massive need for oil for the long-term. This makes the economist in a need to read facts well before publishing.

Engineers work before facts while economists work after facts. Simply engineers make facts such as constructions but economists explain rational behind facts as economy is not like engineering.

This makes the economist in a need to read facts well before publishing reports that may touch its credibility.

Yes, the corona virus was a violent shock to the global economy that might have already accelerated the decision to replace the mood of the global economy - which was already planned to change – but this doesn’t mean that it can swiftly or soon change from its traditional dependence on oil to a serious trend to innovation in the long-term, the world lived by how the corona crisis deepened the necessity to rely on the surge in innovation - and its belongings - which was no longer a luxury requirement, but a need for longevity in the future and this still can’t be executed away from oil that still massively needed by many sectors.