Saudi Arabia
The geopolitics of energy take center stage in the Kingdom of Saudi Arabia, with Saudi Aramco announcing the suspension of plans to expand oil production. Earlier this month, the World Defense Show took place in Riyadh, featuring the participation of leading companies in the military sector.
Saudi Arabia has declared that it will not expand its oil production capacity and is ready to maintain its maximum production capacity at 12 million barrels per day. This decision contradicts the kingdom's previous statement expressing the intention to increase production to 13 million b/d by 2027. Although no official explanation has been provided by Saudi Aramco, it seems likely that it is reevaluating its estimates regarding future oil demand. Despite repeated production cuts by the OPEC+ cartel at the end of 2022 and in the year 2023, oil prices have remained relatively stable. This stability is attributed to the increased production of non-OPEC countries, especially the United States, the world's largest producer. Consequently, Riyadh appears to be considering the reduced demand for Saudi oil in the coming months and years, particularly considering the growth in production from other countries such as Brazil, Guyana, and Canada.
Although the complicated situation in the Middle East did not cause a spike in crude oil prices, Saudi Arabia's decision does not entail a reduction in current output. The news reassured the markets, leading to a drop in prices following the announcement. Energy analysts suggest that Saudi Arabia's move can be interpreted in two ways: first, as a signal to other major producers in the region (particularly the UAE and Kuwait) to increase investments and production; second, as the kingdom's prioritization of investments in projects related to Vision 2030, which involves expanding natural gas fields and renewable energy sources. Supporting the kingdom's decision, the International Energy Agency has stated that oil demand in 2024 is expected to grow at a slower pace than the previous year.
While Riyadh enjoys a significant margin of maneuverability in the energy sector due to its significant oil resources, the kingdom is also striving to play a prominent role in the defense industry. From February 4 to 8, the World Defense Show was held in Riyadh, bringing together representatives from the most important companies in the sector. In the second edition of the event, the kingdom's General Authority for Defense Companies signed eleven cooperation agreements with as many leading international companies. Notably, an agreement with Lockheed Martin for the construction of THAAD ballistic missile defense systems stands out, marking the only production line of the system outside the United States. According to Janes, the production site is part of a 2017 contract worth $15 billion for 44 launchers and 360 missiles, but it will not be operational for another two years. Leonardo, among the participating industries, also signed a Memorandum of Understanding with the Ministry of Investments and the General Authority for the Saudi Military Industries. The agreement aims to discuss, develop, and evaluate investments and potential collaborations in the aerospace and defense sectors. Specifically, the focus is on space activities, maintenance, repair, and overhaul of air structures, localization for electronic warfare systems, radar, and helicopter assembly. The agreement also includes a focus on specific areas in both the aerial combat and multi-domain integration sectors.
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| Head of state | Salman bin Abd al-Aziz Al Saud |
| Head of Government | Mohammad bin Salman Al Saud |
| Institutional Form | Unitary Islamic absolute monarchy |
| Capital | Riad |
| Legislative Power | Unicameral Consultive Council (150 members) |
| Judicial Power | The formally independent judicial system consists of three levels of justice, divided into Courts of First Instance, Courts of Appeal and the Supreme Court. The Appeals Commission deals with trials in which the government is involved |
| Ambassador to Italy | Prince Faisal Bin Sattam Bin Abdulaziz Al Saud |
| Total Area kmq | 2.149.690 km2 |
| Land | 2.149.690 km2 |
| Weather | Harsh and dry with large temperature extremes |
| Natural resources | Oil, natural gas, iron ore, gold, copper |
| Economic summary | Saudi Arabia has an oil-based economy with strong government controls on major economic activities. It has about 16% of the world’s proven oil reserves. Saudi Arabia in one of the most important exporters of oil in OPEC organization. |
| GDP | $834 billion (Dec. 2021) |
| Pro-capite GDP (Purchasing power parity) | $19018 (Dec. 2021) |
| Exports | $167 billion (2020) |
| Export partner | China 20%, India 10.1%, Japan 9.75%, South Korea 8.63%, UAE 5.51%, United States 5.36% (2020) |
| Imports | $143 billion (2020) |
| Import partner | China 22.1%, UAE 12.6%, United States 7.52%, India 4.44%, Germany 4.73%, Italy 2.62% (2020) |
| Trade With Italy | $ 9,52 billion (2021) |
| Population | 35.354.380 (2022) |
| Population Growth | +1,63% (2022 est.) |
| Ethnicities | Arabs 90%, Afro-Asians 10% |
| Languages | Arabic (official language), Tagalog, Rohingya, Urdu, Egyptian Arabic |
| Religions | Islam (official), Catholics 3%, Hindus 1%, others 2% |
| Urbanization | 84.7% (2022) |
| Literacy | 97,6% |
The state-building process of Saudi Arabia ended in 1932. Since then, the country has been a unified sovereign kingdom under the Saud dynasty. The Kingdom of Saudi Arabia is by far the largest state of the Arabian Peninsula. The country borders with Jordan, Iraq and Kuwait to the north, the United Arab Emirates, Qatar and the Persian Gulf to the east, Yemen and Oman to the south and the Red Sea to the west. The population is about 35 million and the official language is Arabic.
Under the leadership of the Saud family, the country has historically played a pivotal political, diplomatic, religious and cultural role within the Islamic and Arab world. This is also due to the presence in the country of some of the main Muslim holy places, such as the Holy Cities of Mecca and Medina. The Kingdom is visited by millions of pilgrims from all over the world each year, making religious tourism a major source of revenues for the Saudi Government.
After the discovery of the first oil fields in 1938 and the consequent boom of the hydrocarbon industry, the Kingdom quickly became one of the richest countries in the region. As a key oil producer and reliable partner for Western powers – mainly the United States – Saudi Arabia has strengthened its diplomatic and political status, positioning itself as an important mediator in the Near East. In recent years, the country has invested in economic diversification programmes, reviewing its diplomatic relations and international investments. A G20 member, Saudi Arabia is an important commercial and economic power and a relevant trade partner for Italy, both in terms of exports and of imports. Total annual trade between the two countries was $ 9,52 billion in 2021. In 2020, Saudi Arabia ranked 26th among Italy’s top import countries, while Italy ranked seventh among Saudi Arabia’s top export countries. Over the last few years, relations between Riyadh and Rome have progressively grown stronger. This has led to the signature of a Memorandum of Understanding for Bilateral Strategic Dialogue between Italy and Saudi Arabia in January 2021.
