Key Takeaways:
- After the East–West Pipeline reopened on Sept. 22 following an 11-day drone shutdown, the author says Riyadh should not rush back to maximum exports: Hormuz and Bab el-Mandeb still threaten delivery, and oil is a finite stock, not a crop.
- The proposed shift is to cut exports toward about 2 million barrels a day and treat $250 a barrel as a “fair-value” benchmark of scarcity and risk—not a price Riyadh can decree. Ten million barrels at $50 and two million at $250 yield the same $500 million a day, while ~2.92 billion barrels a year stay in the ground.
- Extra routes (a Mecca Pact–style land corridor via Jordan and Syria to Türkiye) should move smaller, higher-value volumes, not more cheap crude. The piece cites the 2022 $60 Russian cap and U.S. interest in Venezuelan heavy oil as reasons producers may plan for generations the way consumers already do. Market share, it argues, is a tool—not the goal.
The oil Saudi Arabia does not extract is not lost. Why lower extraction, deferred exports and resource sovereignty offer a safer path amid threats to Hormuz, Bab el-Mandeb and the East–West Pipeline
Riyadh confronts a familiar paradox in a sharper form: full physical capacity to extract hydrocarbons paired with growing vulnerability across its principal export arteries. The East–West Pipeline resumed operations on 22 September after a drone attack had forced its closure for eleven days. Its reopening is welcome, but the disruption demonstrated that even the route designed to bypass the Strait of Hormuz is not immune from attack. The Red Sea outlet, moreover, ultimately depends on secure passage through Bab el-Mandeb.
The instinctive response is to reopen the routes, repair the infrastructure and restore exports as quickly as possible. But is that the only option? Is it in the Kingdom’s interest simply to return to extracting very large volumes at a price that does not compensate us for depletion, risk and the permanent loss of a national asset?
Adversity often exposes the flaws in prevailing assumptions. The recent constraints on Saudi oil exports should therefore not be viewed solely as emergencies to be overcome at any cost. They can instead provide the right occasion for the Kingdom to reconsider the principles governing how much oil it extracts for export, when it brings that oil to market and what value it expects to receive in return.
We must stop mislabeling extraction as production. Crops are grown and goods are manufactured; crude oil is a finite, non-renewable asset drawn down from a subterranean stock. Treating a depletion event as standard manufacturing output invites underpricing. It is extracted from a finite stock formed over millions of years. Every barrel removed from the reservoir is a barrel that can never be replaced. When that barrel is sold too cheaply, increased extraction does not necessarily create additional wealth; it accelerates the consumption of irreplaceable national capital.
Global markets price extraction, logistics and refining, yet routinely fail to account for permanent resource depletion. They rarely compensate the owner fully for surrendering a barrel today rather than preserving it for a future generation, when it may be scarcer, more valuable or more useful within the domestic economy.
The security of delivery must also enter the price. Passage through Hormuz carries one set of dangers; moving crude to Yanbu and onward through the Red Sea carries another. Longer voyages raise freight and insurance costs. If risk is part of delivering the barrel, it must be part of valuing it. The Kingdom should not bear extraction, protection and transport risks while being asked to increase supply so consumers can pay less.
The strategic response should be to reduce extraction itself, rather than simply race to restore previous export volumes. If eight or ten million barrels per day cannot be exported safely and economically, why remove them from their natural reservoirs, place them in storage tanks and expose them to the risks of transport, blockade or attack? The safest and least expensive place to store Saudi oil is the reservoir in which nature placed it.
A more cautious approach would be to reduce export volumes gradually, with the long-term objective of reaching roughly two million barrels a day and using $250 per barrel as a strategic fair-value benchmark—not a price that can simply be imposed on the market, but one that reflects scarcity, depletion, delivery risk and the interests of future generations.
The math is straightforward. Ten million barrels sold at $50 generate gross revenue of $500 million a day. Two million barrels sold at $250 generate the same amount. In the second case, however, eight million barrels remain underground each day—about 2.92 billion barrels a year—while substantial extraction, storage, transport and insurance costs are avoided.
This comparison is conceptual, not predictive. Cutting Saudi supply would not, by itself, produce a $250 price, and Riyadh cannot dictate the global market by decree. Oil prices emerge from supply, demand, inventories, substitution and the behavior of other producers. The point is different: preserving revenue should matter more than maximizing volume, and the Kingdom should stop treating the largest possible flow of crude as an economic achievement in itself.
Any such transition would have to move carefully, alongside fiscal policy, domestic energy requirements and the Kingdom’s wider obligations. Each stage should be tested against its effect on revenue, prices and competitors’ responses. More barrels should also support refining, petrochemicals and industries that create value, jobs and technology at home.
As argued in an earlier article on the Mecca Pact, regional security cooperation should also develop an economic and logistical dimension. A land corridor connecting Saudi Arabia through Jordan and Syria to Türkiye, supported by modern railways, pipelines and loading terminals, could provide an additional route for crude oil, refined petroleum products and petrochemicals destined for regional and European markets. Such a corridor would not replace passage through Hormuz and Bab el-Mandeb or the East-West Pipeline, and its construction would require political stability, substantial investment and binding transit arrangements. Nevertheless, it could reduce dependence on vulnerable maritime chokepoints while integrating Saudi refining and petrochemical industries more closely with the markets of Türkiye and Europe.
That diversification should support, rather than undermine, the decision to extract less. The objective is not to construct new routes merely to accelerate the export of greater volumes of crude, but to create safer alternatives for smaller quantities of higher-value oil and manufactured petroleum products. The priority should be the barrel that strengthens the national economy, not the barrel that leaves the country fastest.
Consumer states already shape oil markets through sanctions, licensing rules, shipping restrictions, strategic reserves and taxation. In 2022, major Western economies imposed a $60 price cap on Russian crude transported with participating maritime services. If intervention by consumers is legitimate policy, why should a producer’s sovereign decision to extract less and conserve a depleting resource be portrayed as a threat to the market?
The principle should be simple: Saudi oil must be managed according to Saudi national interest and the rights of Saudi generations, not solely according to other countries’ preference for abundant, inexpensive supply. The Kingdom should not again be drawn into price wars in which it extracts more, depletes faster and earns less while consumers receive the principal benefit.
There is a revealing paradox. Importing states buy oil, transport it over long distances and then spend heavily to store it. The United States maintains its Strategic Petroleum Reserve in underground salt caverns. Saudi Arabia has an even better store: the oil’s natural reservoir. A barrel left there requires no tanker, artificial cavern or voyage insurance. Deferred oil is preserved wealth whose value may rise with time.
Washington’s maneuvers in Venezuela—securing leverage over vast heavy crude reserves to suppress global pricing—only heighten the urgency. When consuming states institutionalize supply dominance, producers cannot afford passive depletion. Washington has presented the arrangement as a means of expanding low-cost supply and putting downward pressure on global prices. Whatever its long-term political durability, such access gives the United States an additional instrument in the oil market.
Such access could give Washington another way to increase supply when lower prices are desirable. If American companies receive preferential access, it could also shield the US economy from part of the burden of higher world prices. China and other import-dependent economies could then pay the higher global price while the United States benefits from a source under its influence. This is a strategic possibility, not an allegation of a proven hidden plan—but Saudi strategy must consider it.
The recent disruption of Gulf and Red Sea routes reinforces the lesson. Irrespective of any state’s intentions, the practical outcome is that Saudi exports face greater risk while the strategic value of alternative supplies rises. Saudi Arabia should not respond by accelerating depletion before those changes become clear. If a major consuming power plans for access to oil over many decades, the owner of a great oil endowment has an even stronger duty to plan over the same horizon.
Skeptics will argue that cutting output surrenders market share to shale producers and regional rivals. While those risks are real, market share is merely a tool, not a strategic objective in its own right. Why defend a sales percentage by extracting a scarce asset faster and selling it below fair value? The proper measure is the income, strategic influence and intergenerational security those barrels create.
The same principle guides efforts to conserve water, although some sources are partly renewed and supplies can be augmented through treatment, reuse and desalination. Oil is not renewed on any human timescale. It is inconsistent to conserve a partly replenishable resource while racing to remove, in the greatest quantity, one that can never be replaced.
Protecting our maritime routes and territorial infrastructure remains an absolute sovereign priority. Protecting the Kingdom is a sovereign duty. The question is whether political, military and financial resources should also be committed simply to restore cheap oil to international markets. Those are not necessarily the same objective. The interests of producers and consumers overlap, but they are not identical.
Riyadh therefore faces a more fundamental question than simply how to restore the disrupted export routes. It must decide whether restoring those routes should automatically mean returning to high levels of extraction, even when the risks and costs of doing so are not fully reflected in the price received. Oil that remains in the reservoir is not lost revenue; it is a resource still under national control. Once it is extracted and sold under unfavorable conditions, however, that part of the national resource is gone.
If Riyadh chooses this approach, the Kingdom does not lose the oil it decides not to extract. It preserves it. Revenue would not disappear either; the aim would be to obtain comparable value from fewer barrels while keeping more national wealth underground. When consuming powers plan their energy security for generations, Saudi Arabia has the right and duty to do the same. The oil we do not extract is not lost. It remains ours.
