Al-Riyadh Newspaper, June 17, 2025: Economic and Societal Development, Urban Development Initiative, Social Programs

The provided sources discuss a variety of topics primarily centered on Saudi Arabia’s economic and societal developments, particularly within the framework of Vision 2030. Several articles highlight the importance of oil and gas amidst geopolitical tensions, emphasizing Aramco’s role as a key economic pillar and its efforts towards diversification and sustainable energy solutions. Other texts touch upon urban development initiatives like the “City Walk” project and efforts to enhance public services, while also addressing social programs aimed at employment and community well-being. Furthermore, there are segments detailing international relations and regional conflicts, specifically the ongoing tensions between Iran and Israel and their impact on global oil markets, and the broader humanitarian implications in Gaza. Finally, the sources include reports on Saudi initiatives in media, sports, and cultural innovation, demonstrating a broad commitment to progress and global engagement.

Oil Market Dynamics: Geopolitics, Supply, and Investment Challenges

Oil market instability is currently a significant global concern, largely influenced by ongoing geopolitical conflicts, supply dynamics, and investment trends.

Here’s a detailed discussion:

• Impact of Geopolitical Conflicts:
• The importance of oil and gas cannot be underestimated during times of conflict, a reality currently being observed. The history has shown that when conflicts occur, the significance of oil and gas cannot be downplayed.
• Ongoing threats to energy security continue to raise global concern.
• Recently, oil prices jumped after Israel carried out strikes on Iran, which heightened fears of an escalating regional conflict. The direct military confrontation between the two long-standing adversaries, Israel and Iran, has raised concerns among global leaders about a potential wider regional conflict.
• This has led to increased volatility in oil prices, with Brent crude and West Texas Intermediate (WTI) crude experiencing fluctuations. Both benchmarks saw significant jumps, indicating market sensitivity to these tensions.
• The potential for Iran to escalate the conflict by targeting Israeli interests or even choking the Strait of Hormuz could push global oil prices significantly higher, possibly to $100 per barrel.
• The Strait of Hormuz is a critical choke point, a narrow waterway between Iran and Oman, through which nearly one-fifth of the world’s total oil consumption (around 20 million barrels per day) passes. Most crude oil from OPEC members like Saudi Arabia, the UAE, Kuwait, and Iraq passes through this strait, especially towards Asia.
• Any Iranian action to close or delay transit through the Strait could trigger significant concern in energy markets and disrupt global oil and gas supplies.
• Supply and Demand Dynamics:
• Despite geopolitical tensions, one factor that could help keep crude oil prices in check is the current abundance of global oil supplies.
• However, there are conflicting forecasts regarding future oil demand. The OPEC Secretary General stated that global oil demand will continue to grow without a foreseeable peak, expecting it to reach 120 million barrels per day by 2050.
• In contrast, the International Energy Agency (IEA) forecasts that demand will peak at 102 million barrels per day by 2028 or before 2030, with production declining to 97 million barrels per day by 2050.
• Investment and Production Challenges:
• There is a significant underinvestment in the oil and gas industry. OPEC has warned about declining oil supplies from non-OPEC producers, including US shale oil, due to lower oil prices.
• This lack of investment contributes to supply constraints and fuels oil price volatility. High government taxes on upstream investments have also reduced company profits, making investments less attractive.
• The transition to net-zero emissions could cost up to $200 trillion, and renewable energy sources currently do not meet existing demand. As a result, energy security and cost affordability have recently joined sustainability as pivotal goals for the energy transition.
• Saudi Aramco, as a global energy giant, continues to achieve strong results across all its upstream and downstream operations, including oil, gas, refining, chemicals, energy transition, and sustainability. The company reported significant net profit for Q1 2025, driven by higher sales volumes of crude oil, gas, and refined and chemical products.
• Aramco is progressing with efforts to increase its gas production and expand its global retail business, alongside developing its petrochemical strategy and blue hydrogen initiatives.
• The company’s reserve capacity provides the necessary flexibility to meet potential growth in oil demand. Saudi Aramco is also investing in long-term projects to increase its crude oil production capacity in the coming years to maintain its maximum sustained production capacity and ensure reliable energy supplies to its customers.

Geopolitics, Oil, and Global Market Stability

Geopolitical conflicts have a profound and destabilizing impact on the oil market, a reality currently being observed. Historically, the significance of oil and gas cannot be downplayed during times of conflict, and ongoing threats to energy security continue to raise global concern.

Here’s a breakdown of the impact of geopolitical conflicts on oil market instability:

• Direct Impact on Oil Prices and Volatility
• Oil prices jumped significantly after Israel carried out strikes on Iran, which heightened fears of an escalating regional conflict.
• This led to increased volatility in oil prices, with Brent crude and West Texas Intermediate (WTI) crude experiencing notable fluctuations. Both benchmarks saw significant jumps of more than $4 per barrel on Friday, reaching their highest levels since January.
• The direct military confrontation between these long-standing adversaries, Israel and Iran, raises concerns among global leaders about a potential wider regional conflict.
• The escalation could push global oil prices significantly higher, possibly to $100 per barrel, especially if Iran chooses to respond outside Israeli borders.
• Threats to Critical Choke Points
• The Strait of Hormuz is identified as the most sensitive and critical choke point for global oil shipping.
• Nearly one-fifth of the world’s total oil consumption, approximately 20 million barrels per day, passes through this narrow waterway between Iran and Oman.
• Most crude oil from OPEC members like Saudi Arabia, the UAE, Kuwait, and Iraq passes through this strait, especially towards Asia.
• Any Iranian action to close or delay transit through the Strait could trigger significant concern in energy markets and disrupt global oil and gas supplies.
• Such a scenario would likely lead to a sharp increase in oil prices, potentially pushing them into the triple digits.
• While Saudi Arabia and the UAE have developed alternative pipelines to bypass the Strait of Hormuz, these routes may still be vulnerable to regional threats, such as attacks from Iran-backed Houthis in Yemen. For countries like Iraq and Kuwait, bypassing the Strait is considerably more difficult due to their geographical location.
• Broader Economic and Market Reactions
• The escalating conflict has increased demand for safe-haven assets like gold, reflecting heightened investor anxiety, even though gold prices might still experience profit-taking.
• Despite the tensions, global stock markets, particularly in Asia, have shown some resilience, suggesting that investors might be pricing in a potential de-escalation rather than a prolonged conflict.
• The strength of the dollar has also been noted, benefiting from increased demand for safe havens and its status as a currency of a major oil-exporting nation.
• Supply Dynamics and Mitigating Factors
• Despite geopolitical tensions, one factor that could help keep crude oil prices in check is the current abundance of global oil supplies.
• However, ongoing geopolitical issues contribute to supply constraints and fuel oil price volatility due to underinvestment in the oil and gas industry.
• Aramco’s Perspective and Resilience
• Saudi Aramco, as a global energy giant, emphasizes that the importance of oil and gas cannot be underestimated during times of conflict.
• The company has continued to achieve strong financial results despite market volatility, driven by its unique advantages such as size, reliability, low operating costs, and advanced technologies.
• Aramco’s reserve capacity provides the necessary flexibility to meet potential growth in oil demand and utilize spare capacity to meet supply needs during disruptions.
• The company is strategically investing in increasing its crude oil production capacity and expanding its gas production to ensure reliable energy supplies.
• Saudi Arabia’s Stance on Conflict
• Saudi Arabia has condemned the Israeli attacks on Iran, stating they are a blatant violation of Iran’s sovereignty and security and contravene international law.
• The Kingdom stresses the importance of the international community taking responsibility to find political solutions and de-escalate tensions.
• Saudi leadership actively engages in continuous communication with global leaders and influential parties to address regional developments and promote cooperation instead of conflict.
• Saudi Arabia believes political and diplomatic solutions are the optimal path to ensure regional prosperity and integration, aiming to move the region from conflicts to cooperation and economic development. It sees itself as a fundamental pillar of stability and a key factor in promoting global peace.

In summary, geopolitical conflicts, particularly the recent Israel-Iran tensions, significantly impact oil market instability by causing price volatility, raising fears of supply disruptions via critical choke points like the Strait of Hormuz, and influencing broader market sentiment. While the current abundance of global oil supplies might offer some cushioning, the underlying threats to energy security highlight the enduring importance of oil and gas and the need for diplomatic solutions to maintain regional and global stability.

Saudi Arabia’s Vision 2030: Economic Diversification and Growth

Economic diversification is a central pillar of Saudi Arabia’s strategic vision, primarily articulated through Vision 2030, aimed at reducing the Kingdom’s reliance on oil and fostering a more robust and sustainable economy. This long-term strategy seeks to build a modern and prosperous state with a powerful economic influence regionally and globally, specifically by diversifying sources of income and enhancing the Kingdom’s capacity to re-employ its potential.

Here’s a detailed discussion of economic diversification, drawing on the provided sources:

• Core Objectives and Rationale:
• The primary goal is to reduce the Kingdom’s dependence on oil revenues, which historically have formed the largest portion of its income.
• This diversification is a direct response to, and a buffer against, the instability and volatility inherent in oil markets. As mentioned in our previous conversation, oil market instability is a significant concern due to geopolitical conflicts and supply dynamics.
• It aims to create a strong and influential economy that is less susceptible to fluctuations in global oil prices, thereby ensuring long-term stability and prosperity.
• Key Strategies and Initiatives:
• Vision 2030 as the Framework: The ambitious goals are pursued through a series of qualitative policies, programs, and plans under Vision 2030.
• Structural Reforms and Investment Environment: Recent achievements are attributed to a series of structural reforms implemented as part of Vision 2030. These reforms have strengthened economic diversification, lessened reliance on oil, and created a safe and attractive environment for foreign investment. This includes enhancing investment facilities.
• Role of the Public Investment Fund (PIF): The PIF plays a crucial role by harnessing the potential of promising local sectors to support economic diversification and contribute to the growth of the non-oil gross domestic product (GDP).
• Private Sector Empowerment: The strategy emphasizes the private sector’s vital role in development and construction, which has propelled the Kingdom to advanced positions in global competitiveness indicators.
• Diversification into New Sectors:
• Construction and Infrastructure: The real estate and construction sectors are experiencing rapid activity, supported by anticipated expansion in major housing and infrastructure projects. This is evident in the 14% increase in cement sales in May 2025, reaching 4.8 million tons, reflecting robust activity and future growth driven by projects like the 2034 FIFA World Cup and Expo 2030.
• Technology and Innovation: There is significant progress in the environment for entrepreneurship, especially in indicators of venture capital and infrastructure for the entrepreneurial ecosystem. This includes rising levels of innovation and investment in emerging technologies. Key sectors highlighted are Artificial Intelligence, financial technologies, cybersecurity, smart cities, and digital health, which are fundamental pillars of the Kingdom’s economic transformation plans.
• Tourism and Aviation: Efforts are underway to strengthen the Kingdom’s position as a global center for aviation and tourism. Riyadh Air, for instance, aims to serve over 100 global destinations by 2030, contributing to the National Aviation and Tourism Strategies. Similarly, AviLease’s significant aircraft orders reinforce its commitment to sustainable aviation and aligns with PIF’s goals of supporting economic growth and diversifying income sources.
• Media and Entertainment: The Saudi media sector has undergone a significant transformation, with its size projected to exceed $11 billion by 2030 from $6 billion in 2023. Its contribution to GDP is also expected to rise from $4 billion to $12 billion in the same period, with job creation increasing from 60,000 to 150,000. This includes the growth of Saudi films gaining international awards and the gaming sector expanding remarkably, demonstrated by events like “Gamers8” attracting 1.2 billion views.
• Aramco’s Internal Diversification: Even Aramco, the national oil giant, is actively diversifying its own operations. It is increasing its gas production and expanding its global retail business, alongside developing its petrochemical strategy and blue hydrogen initiatives. Its reserve capacity provides flexibility to meet potential oil demand growth and to utilize spare capacity during disruptions. Aramco is also investing in long-term projects to increase its crude oil production capacity to maintain its maximum sustained production capacity and ensure reliable energy supplies.
• Economic Outlook and Impact:
• The Kingdom’s economy is moving confidently towards achieving the aspirations of Vision 2030, aiming to become one of the 15 largest economies in the world.
• A World Bank report indicates that the Saudi economy is set to overcome a period of growth slowdown experienced in 2023 (due to voluntary oil production cuts) and will enter a phase of accelerating growth starting from the current year. This growth is largely driven by the expansion of non-oil sectors.
• The diversified approach has allowed Saudi Arabia to achieve success and overcome challenges that have negatively affected other global economies.
• Despite ongoing geopolitical tensions, the resilience of global stock markets, particularly in Asia, has been noted, suggesting that investors might be pricing in a potential de-escalation rather than a prolonged conflict, partly due to underlying robust economic policies including diversification.

In summary, Saudi Arabia’s economic diversification, primarily driven by Vision 2030, involves a comprehensive strategy of structural reforms, significant investments in non-oil sectors like technology, tourism, aviation, media, and construction, and the empowerment of the private sector. These efforts are not only boosting economic growth and creating jobs but also strengthening the Kingdom’s resilience against the inherent volatilities of the global oil market, making its economy more robust and globally competitive.

Saudi Vision 2030: Regional Economic Transformation

Economic diversification is a cornerstone of Saudi Arabia’s Vision 2030, aiming to transform the Kingdom into a global economic powerhouse and reduce its historical dependence on oil revenues. Regional development projects are central to this strategy, designed to broaden income sources and leverage the Kingdom’s vast potential by fostering growth across diverse sectors and geographical areas.

Here’s a discussion of key regional development projects and initiatives:

• Infrastructure and Urban Development
• The real estate and construction sectors are experiencing significant activity, driven by major housing and infrastructure projects across the Kingdom. This is evidenced by a 14% increase in cement sales in May 2025, reaching 4.8 million tons, reflecting robust construction, particularly in Riyadh where demand is expected to increase by 20%.
• Preparations for hosting global events like the 2034 FIFA World Cup and Expo 2030 are major catalysts for this expansion.
• Specific urban development includes efforts to improve Dammam’s entrances in the Eastern Region, focusing on enhancing the urban landscape to reflect architectural identity and improve quality of life.
• Ongoing maintenance and improvement works in municipalities like Hafr Al-Batin are contributing to better public spaces, including gardens and streets. Similarly, Al-Baha Municipality has executed various service and supervisory works, including preparing 80 parks and organizing 50 events during Eid al-Adha, signifying a focus on local quality of life. Jazan Municipality’s volunteer efforts, involving over 26,000 volunteers contributing more than 419,000 hours, highlight community engagement in urban improvement, such as removing distortions and enhancing services.
• Tourism and Hospitality Sector Growth
• Vision 2030 aims to strengthen the Kingdom’s position as a global center for aviation and tourism.
• Riyadh Air, a new national carrier, plans to serve over 100 global destinations by 2030, contributing approximately 75 billion SAR to the non-oil GDP and creating over 200,000 direct and indirect jobs. This initiative, along with AviLease’s significant aircraft orders (77 Airbus aircraft), reinforces the Kingdom’s commitment to developing a modern and sustainable aviation system.
• Smart applications are reshaping the visitor experience, such as “Rouh Al-Saudia” for exploring diverse tourist sites and events, “Tawakkalna” for providing essential information and services to tourists, and “WeBook” for seamless event and facility booking. These digital tools enhance the tourism sector and underscore digital transformation efforts.
• The Hajj season itself serves as a massive, annual regional development project. An integrated organizational apparatus involving over 450,000 individuals from government, private, and volunteer sectors ensures a smooth and safe experience for millions of pilgrims. This includes advanced logistical arrangements, healthcare facilities, transportation networks, waste management, and crowd control using cutting-edge technology. Innovations like the “Nusuk” smart card facilitate pilgrim services and movements.
• Jeddah’s historic district continues to attract pilgrims for shopping and cultural experiences before their departure, showcasing efforts to leverage existing heritage for tourism.
• Wadi Muharram, near Taif, is being developed as a tourist destination, with traditional farms being transformed into resorts that also promote local products like Taif roses, drawing both tourists and pilgrims.
• In Jazan, efforts are underway to promote local cuisine and cultural heritage, integrating traditional Jazani dishes into global culinary arts training programs, thus fostering specialized tourism and hospitality skills in the region.
• Technology and Innovation
• Saudi Arabia has made a significant leap of 60 places globally in the environment for startup businesses, with Riyadh now ranking 23rd among 100 emerging business environments. This progress is supported by increased venture capital, improved entrepreneurial infrastructure, and rising levels of innovation, particularly in Artificial Intelligence, financial technologies, cybersecurity, smart cities, and digital health. These sectors are key pillars of the Kingdom’s economic transformation plans.
• The concept of remote work is actively being considered and implemented, particularly in Riyadh, to manage urban growth, improve quality of life, and enhance productivity, supported by digital platforms like “Qowa” and “Musk” initiatives.
• Cultural and Creative Industries
• The Saudi media sector is undergoing a significant transformation, with its projected size expected to exceed $11 billion by 2030 (from $6 billion in 2023) and its GDP contribution rising to $12 billion (from $4 billion) in the same period. This growth is anticipated to create 150,000 jobs by 2030. The success of Saudi films and the gaming sector (e.g., “Gamers8” attracting 1.2 billion views) demonstrates this expansion.
• The “Cultural Innovation Challenge” (Polisithon), overseen by the Ministry of Culture, fosters innovation in cultural policy design, covering themes like the Arabic language, cultural tourism, authentic customs, children’s cultural content, and national festivals. This initiative seeks to empower Saudi talents and contribute to the growth and sustainability of the cultural sector.
• The “Year of Handicrafts” (2025) initiative aims to transform traditional crafts into a vibrant economic, cultural, and educational sector, promoting local artisans, providing training, and integrating crafts into the creative economy.
• Agriculture and Food Security
• In the Al-Jouf region, the Agricultural Development Fund actively supports farmers and animal wealth, aligning with Vision 2030’s goals for food and water security. This highlights regional efforts to diversify into sustainable agricultural practices.

In essence, these regional development projects, underpinned by Vision 2030’s strategic reforms, aim to create a multifaceted, resilient economy that is less reliant on oil. By investing heavily in diverse sectors, fostering innovation, and empowering both public and private sectors, Saudi Arabia is actively transforming its various regions into dynamic hubs that contribute to national prosperity and global competitiveness.

Humanitarian Aid in Crisis: Challenges and Consequences

Humanitarian aid faces significant and escalating challenges, jeopardizing the ability of organizations to deliver critical assistance to populations in desperate need. These challenges are multifaceted, encompassing financial, logistical, and political obstacles, often intensified by ongoing conflicts and natural disasters.

Key Humanitarian Aid Challenges:

• Severe Funding Shortfalls: A major impediment to humanitarian efforts is the unprecedented decline in funding for aid operations. The UN Office for the Coordination of Humanitarian Affairs (OCHA) initially aimed to collect $44 billion for global humanitarian efforts in 2024, but this target was later reduced to $29 billion due to unmet pledges. By June, only $5.6 billion had been received, forcing a significant reduction in the number of people aid can reach, from an original target of 180 million to just 114 million. This drastic cut jeopardizes the lives of many, as agencies are unable to provide necessary support.
• Impact of Conflict and Violence: Conflict and associated shocks are primary drivers of acute food crises globally. In contexts like Gaza, continuous military operations and sieges have left the entire population of 2.1 million people facing severe food insecurity, with nearly half a million at risk of starvation by the end of September. Similarly, the conflict in Sudan is expected to continue exacerbating the crisis and displacement, affecting approximately 25 million people. These environments make aid delivery extremely hazardous and complex.
• Restricted Access and Deliberate Obstruction:In Gaza, aid distribution centers have reportedly become “death traps” due to bombardment and direct targeting, leading to high casualties among civilians awaiting aid.
• The Israeli occupation forces have been accused of deliberately cutting internet and landline communications in Gaza repeatedly—for the ninth time—to obscure facts, deepen the humanitarian catastrophe, and prevent the outside world from witnessing the reality on the ground. These communication blackouts severely disrupt the work of medical and relief teams, preventing aid from reaching those in need and potentially leaving the wounded to die without intervention.
• In Jenin, Israeli forces have reportedly converted dozens of homes into military barracks, imposing movement restrictions and temporary displacement on residents. This creates an environment of fear and tension, further complicating aid access and daily life.
• Geopolitical Prioritization and Shifting Funds: Some countries have significantly cut their international aid budgets, with bodies like the UN High Commissioner for Human Rights noting that many donor states are redirecting their budgetary priorities from international institutions to military spending. This shift directly impacts the resources available for humanitarian assistance.
• Exacerbating Factors: Beyond conflict, economic risks and climate change contribute to the severity of food crises. For instance, rising grain prices in Mali are placing 2,600 people at risk of starvation by the end of August.

Consequences of Challenges:

The combined effect of these challenges means that humanitarian organizations struggle to provide aid, leading to a deepening of crises in affected regions. The lack of resources and safe access means that even when needs are known, the ability to respond effectively is severely limited. This situation underlines the urgent need for increased funding, unimpeded access, and adherence to international humanitarian law to protect civilians and enable aid delivery in conflict zones.

By Amjad Izhar
Contact: amjad.izhar@gmail.com
https://amjadizhar.blog

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