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Crude prices will touch $200 a barrel if the Arab revolution
spreads to Saudi Arabia, the Centre for Economics and Business Research
(CEBR) said on Friday.

'... the revolutions around the Arab world have pushed up the price
of oil which had temporarily stabilised at $116 yesterday. This is 38%
above its average level for 2010. And if the unrest spreads to the Gulf
states and Saudi Arabia, the price could rise to $200 easily, CEBR said.

However, irrespective of whether the unrest gobbles up Saudi Arabia
or not, the oil policy of the world's largest exporter is going to
change, according to Douglas McWilliams, chief executive of the
London-based think tank.

He points out that Saudi Arabia has acted as a swing producer
historically, using its reserve production capacity as a lever on price
stability. Saudi Arabia has acted to prevent a price overheating, which
could push the world into looking for alternatives, in which case oil
producers' revenues will dry up.

If the ruling elite's outlook on the longevity of oil-based
prosperity as well as their continuance in power changes, that could
reflect in their oil policy too, according to McWilliams. "One imagines
that their expectation of the length of time receiving the oil revenues
has been shortened considerably, in which case the optimal policy is t... >>>