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The Importance of Oil for the Arab World

Oil plays an important role in the world economy, but it holds a place of particular importance in the Arab world. The economies of many Arab countries are based on oil, although some economies, such as that of Dubai, have diversified in order to focus on other sectors such as tourism and financial services.

The dependence of world industry and the economy on oil makes this the Arab world's most important products. Approximately 30 billion barrels of oil is used every year, worldwide and the oil industry, from the production and distribution of oil to its refinement and sale, is the largest global industry, in terms of its value.

The Arab world is not the only producer of oil, although the Middle East has been the most important oil producer since the end of the Second World War. Other countries such as Russia, Venezuela and the US still produce oil, but it is the Arab countries which play the most important role in the oil industry. Arab countries play an important role in the Organization of the Petroleum Exporting Countries or POEC. Iran, Iraq, Kuwait, Qatar, Saudi Arabia and the United Arab Emirates are all members of the organization, which is made up of 12 countries which are net exporters of oil.

Many of the largest oil companies in the world are based in the Arab World. The top three oil companies, according to their production rates and the size of their oil reserves, are Aramco, the National Iranian Oil Company and Qatar Petroleum. Oil brings a lot of money into the Arab world.

Many countries in the Arab world rely on oil for their own energy production as well as for export. The Middle East is the region which relies most heavily on oil (and which is scared of the peakoil theorem the most). About 53 percent of energy consumption in this region is oil based, compared to 40 percent in North America and 32 percent in Europe.

Oil and other petroleum products tend to be much easier and cheaper to use in oil producing countries since there is no need to transport them anywhere. Many countries in this region, such as Qatar, enjoy low fuel and gasoline prices, relative to the rest of the world, which can make them an attractive place in which to live or to do business.

Since the Arab world is a major producer of oil, the environmental issues related to oil production, transportation and use are potentially very important for these countries. Another issue that may play a significant role in the future of the Arab world is the depletion of the oil reserves and the peak oil theory.

Oil has played an important role in the economies of many countries in the Arab world, and the discovery of oil has resulted in rapid development of both an economic and a social nature in many of these countries, such as Dubai and Qatar. The wealth produced in the Arab world by the oil industry has had many positive effects in the region. Governments have been able to provide new infrastructure, educational and health services, and even to begin developing strong, diversified economies that do not rely solely on oil. However, oil has also been implicated in many of the negative developments in the Arab world, including relations between Arab countries and their relations with other countries around the world.

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