As we’ve noted previously, the US-Saudi joint effort to force the Kremlin into cutting Assad loose (the end goal of course being to install a government that will acquiesce to mainlining Qatari natural gas [6] through Syria straight into Europe thus breaking Gazprom’s stranglehold), has resulted in a bit of collateral damage for the world’s less geopolitically important oil producing countries (take Venezuela for instance, where collapsing crude prices have exacerbated an already abysmal scenario, leading to, among other tragic outcomes, a shortage of soap [7] and condoms [8]).
Bloomberg suggests that the destabilization of already fragile political and economic situations could lead, in short order, to “regime change” across oil producers:
The large petrostates are varying degrees away from the Weberian ideal of the rule of law. That could spell trouble. Low oil prices threaten the ability of these inefficient, sometimes corrupt states to service their debts and may curtail the government spending that keeps the masses content. This may in turn ignite demands for a fairer distribution of these dwindling oil proceeds and, possibly, regime change.
From Bloomberg, utilizing Worldwide Governance Indicators’ measures of corruption and rule of law:
[9]
…and an update on oil producers’ currencies since peak oil…
… and default risks…
[10]
