The Roman Philosopher Lucius Anneaus Seneca (4 BCE-65 CE) was perhaps the first to note the universal trend that growth is slow but ruin is rapid. I call this tendency the "Seneca Effect."
Showing posts with label oil sheik. Show all posts
Showing posts with label oil sheik. Show all posts

Wednesday, March 3, 2021

The Death of Ahmed Zaki Yamani, the "Oil Sheik" who Understood Everything

Ahmed Zaki Yamani, oil minister of Saudi Arabia until 1986, died in London last week. In memory of the "oil sheik," I reproduce here a comment that appeared on the ASPO-Italia blog in 2006. The interview of Yamani by Oriana Fallaci in 1976 is a good example of how the oil problem is misunderstood in the West and of the many lies told about it. Yamani, despite all the accusations and insults he received, was always a moderate who sought compromise. He managed to prevent his country, Saudi Arabia, from the disasters that befell all oil-producing countries in the Middle East.  

Unfortunately, Yamani's legacy has been somewhat lost over the years, but it is only now that Saudi Arabia is seeing bombs falling on its territory -- a destiny that so far the country had avoided. Now, things are going to become very difficult as Saudi Arabia faces the unavoidable decline of its once abundant oil resources.

Yamani is remembered, among other things, for having said that “The Stone Age did not end because the world ran out of stone, and the Oil Age will end long before the world runs out of oil.” And, with that, he demonstrated that he had perfectly understood the concept of "EROEI" and the consequences of gradual depletion. 

(Fallaci's interview is available in full at this link.)

Fallaci interviews Yamani: thirty years later
Di Ugo Bardi - September 2006 (slightly edited for publication on "The Seneca Effect")

About thirty years ago, at the height of the first "Oil Crisis," the Italian journalist Oriana Fallaci interviewed the Minister of Oil of Saudi Arabia, Sheikh Ahmed Zaki Yamani. The text of the interview appeared in the newspapers and can be found today in the book "Interview with History" (BUR 2001).  

The interview with Yamani is just one of the many interviews that Oriana Fallaci had obtained from the various powerful men of the 1970s (among them Henri Kissinger). Somehow, being interviewed by her seems to have been fashionable, or perhaps it was something that they could not avoid. According to what Fallaci herself tells us, Ahmed Zaki Yamani hesitated for a long time before agreeing to be interviewed. In the end, however, he invited Fallaci to his home in London, then in Jeddah, and received her with great courtesy, and introduced her to his wife Taman and his daughters. 

Fallaci's interview is interesting because it reproposes the elements that have characterized the debate on oil from then until today. On the one hand, the political interpretation of the crisis, as due to a conspiracy with ideological or religious roots. On the other, the pragmatic interpretation of the crisis, as due to the impossibility of production to satisfy demand and maintain a low price. 

There was also a human side of the interview and, from what she writes, it doesn't seem that Fallaci was particularly grateful to Yamani for his kindness. On the contrary, her antipathy towards him is evident. You see it in all her questions and her comments, but also when she describes his eyes as "Only his eyes alert one to his true self: brilliant, darting, crafty. Eyes that know how to lie, to caress and pierce one with ruthlessness." Fallaci, evidently, thinks she has supernatural telepathic powers. 

She defines Yamani as, "The man who can take us back to the days when we traveled on horseback, who can close our factories, make our banks fail ..." Or consider when she bluntly tells him: "You wanted money and you got it: ruining us." Then, she accuses Yamani of blackmail, of wanting to buy an atomic bomb, of being " diabolical," and things like that. Later on, Fallaci accused Yamani of having attempted to seduce her while she was in his house, although this accusation does not appear in the interview.

It's not so much a question of insults. What is striking about this interview is how Fallaci had not even minimally prepared herself on the subject of crude oil. She was unable to ask questions that were not simply based on the various legends of the time (the same as today). To illustrate how the interview looked most of all as something in the style of a gossip magazine, here are some excerpts.

"Where is the money? I see many gold watches in your shop windows and gold lighters, gold rings, I see big cars in your streets, but I don't see houses, I don't see real cities."  Fallaci apparently believed that the Saudi were still living in tents in the desert

"We know very well that the emirs use the money to buy golden water closets" Again, Fallaci doesn't seem to be bothered by the need of verifying her assertions.

"In Saudi Arabia people dig for water and find oil." If you think that it could be true, note that the oil fields of Saudi Arabia are typically located at depths of a few kilometers, far more than the depth of water wells.

Throughout the interview, Fallaci revolves around the concept that the Arabs were plotting against the West using oil as a weapon. Several times he tries to get Yamani to admit that, yes, there is a plot against the West to ruin us and to establish the world Islamic dictatorship. If possible, she would like to make him admit that it is him, Ahmed Zaki Yamani, who is the leader of the plot. It is as if she saw the interview as part of a Hollywood movie, where the villain usually confesses his crimes out of pure bragging.  

In partial defense of Fallaci, it must be said that, in those years, almost everyone in the West believed that the crisis of the 1970s had purely political origins. Today, we clearly see from the data that the crisis was instead caused by the US peak production, which took place in 1970. But the vehemence with which Fallaci attacks Yamani in the interview does not seem to be based on any data.

Yamani, for his part, always replies without losing his temper. It is clear that he considered Fallacy as a kind of time bomb, to be treated with caution and handled with gloves. It must have really taken a lot of patience for him to answer the series of questions that came to him: many were simply silly, some offensive, and others indiscreet. An example of the last kind is the one about the feelings he had experienced witnessing the execution of the killer of King Feisal. But Yamani is always courteous and answers without ever dodging the question, even though in his heart he must have wondered more than once what was that led him into such a situation. Fallaci, instead of appreciating that, accuses him, saying that "spontaneity was forbidden."

In the end, what makes the interview interesting is not Fallaci, but Yamani. Despite the lack of knowledge evident from the questions he received, Yamani manages to give a complete and organic picture of the oil situation of the time, which already foreshadowed today's world. At the time, Saudi Arabia produced three and a half million barrels a day, but Yamani said it could have produced 11. In fact, Saudi Arabia has managed to produce nearly 11 at certain times.  

Yamani was clear about the strategy that Saudi Arabia would adopt in the years to come: that of "swing producer" or needle of the balance that would have stabilized production and avoided further crises in the future. He had perfectly framed the world oil situation as it would be for at least three decades to come. Fallaci was unable to appreciate the value of what she was told but, reading the interview, one is struck by the clarity with which Yamani had predicted the events of the next thirty years and even more.

Are Yamani's considerations still valid today? Overall, yes, but they won't continue to hold for very long. Today, Saudi Arabia faces a very difficult future. It is said that the country will still be able to increase production, but it is also said that the current fields have reached their limits and that the decline is about to begin. Sooner or later, Saudi Arabia will no longer be the tip of the balance it has been since the time of Yamani. The exhaustion of resources is the real problem and not the "emirs who buy water closets of gold" as Fallaci said, perhaps really believing it.

Oriana Fallaci is gone today. Yamani has no longer been oil minister since 1986, today he is an elderly gentleman who lives in London and deals with Islamic studies (n.d.a. this was written in 2007, Yamani died in 2021). The world goes on, the events of the past always present themselves the same but in always different forms. One thing changes, however: there is less and less oil to extract).