Plunging Oil Prices: The Challenge for the Gulf Oil Economies

The decline in oil prices from $115 per barrel in June 2014 to less than $60 per barrel in March 2015 (Crude Oil Brent) was caused in part by the refusal of the Organization of Petroleum Exporting Countries (OPEC) to lower production. One explanation for the willingness of the Gulf states to suffer a steep decline in their short term revenues is their desire to moderate the effect of the energy revolution led by the US, which accelerated its oil production rate by about 50 percent since 2008 as a result of substantial technological improvements. 



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