Edward L. Morse

An annotated Foreign Affairs syllabus on oil.

Thanks to a steady increase in oil output in recent years, Russia is now poised to displace Saudi Arabia as the key energy supplier to the West. But the kingdom has not welcomed Russia's gain. The emerging contest for oil dominance between Russia and Saudi Arabia will profoundly affect U.S. energy security, Russia's global role, Saudi power, and the Organization of Petroleum Exporting Countries, not to mention the global economy.

The most startling surprise in the international economy during the 1980s has been the fulfillment of prophecies made five years ago--often voiced, seldom believed--that oil prices would decline significantly from their peak price of over $40 a barrel in 1980-81. Prices have, in fact, fallen to less than $12 a barrel on the spot market this past winter.