Forty-five years ago, Saudi Arabia and its allies cut off oil supplies to the United States for supporting Israel and as a result the oil price quadrupled causing a huge shock in global economy.
Now the kingdom is facing threats of punishment over the unexplained disappearance of a Washington Post journalist, Jamal Khashoggi, and is talking of retaliation if America imposes sanctions.
US Imports from Saudi Arabia have almost halved over 25 years, according to the US Energy Information Administration, United States imported 9% of its oil from the kingdom but that doesn’t mean the US does not still need Saudi oil as the kingdom remains the No. 2 source of foreign oil in the United States behind only Canada.
Any move by the Saudis to cut supply would push up global oil prices, hitting drivers in their pockets and further forcing up inflation that already threatens to take the shine off America’s economy and Such shock would come at a very sensitive time.