Learning from Riyadh’s realism in foreign policy

Saudi Arabia's strategic calculus rests on five interlocking pillars: A firm finger on the global energy supply balance, custodianship of Islam's holiest sites, sovereign capital deployment, multi-vector diplomacy, and enabling domestic reforms.

- Kashyap Kompella

Energy as strategic leverage: Saudi Arabia functions as the central bank of oil, as it holds the largest-deployable spare oil capacity in the world — around three million barrels per day, nearly 60% of the slack of OPEC+, the oil-producing nations’ alliance. By adjusting oil production unilaterally or through OPEC+, Riyadh sets the marginal cost of stability in global energy markets, Such conduct may not always sit well with major consumers including the US, but it protects Saudi fiscal stability and validates a nonaligned doctrine: Markets, not allies, determine the course of action.

Riyadh is also hedging the post-oil transition. Expansion of new gas field capacity and a plan to shift its power-sector to a 50-50 gas-renewable mix by 2030 are meant to free more crude oil for export. Its downstream investments in refineries and petrochemical complexes globally maintain demand even in a decarbonising world; Riyadh has fashioned a structural flexibility for itself. While national control over critical commodities is a hard power chip, for independent powers, the lesson here is the value of optionality: Strategic depth comes not from maximum production, but from discretionary capacity, the ability to restrain supply when others cannot.

Custodianship and cultural capital: While oil provides the hard bargain, the two holy cities, Mecca and Medina, provide unmatched soft power in the Islamosphere. Under Vision 2030, the plan to diversify away from oil, Riyadh is converting the soft power into an economic base. Scaling of the infrastructure for religious tourism is underway — modernisation of the Jeddah airport, expansion of the region's high-speed rail, and digital visa platforms, will increase the region’s tourism revenues.

Diplomatically, this custodianship grants Saudi Arabia not only moral precedence with the Organisation of Islamic Cooperation but also legitimacy in the eyes of the faithful from Indonesia to Nigeria.