Following Kuwaits attempt at calming the masses with outright bribery, FT Alphaville tells us that Saudi Arabia has a go at exactly the same thing :

While many argue that Saudi Arabia and its oil reserves remain in little danger of being rocked by unrest, King Abdullah perhaps disagrees.

Via Al Arabiya, this appears to be the stimulus package the king announced on Wednesday:

SR40bn for the Housing Fund ($10.6bn)

SR15bn for the housing budget ($4bn)

SR30m for the Saudi Credit Bank

A 15 per cent increase in salaries

Financial support to jobseekers for one year

SR10m for professional committees

As our FT Tilt colleagues point out, it’s also the first time the Saudi government has made unemployment payments.

The point made at the end there seems to be a very wise move as youth unemployment seems to be driving a lot of the current unrest. Given that, I am quite surprised that we haven’t seen rioting in Spain yet as nearly one in every two under 25’s is unemployed :

In just over two years the nation’s jobless rate has soared to nearly double the average in the 16-country eurozone. Some 15.7 million people are out of work across the eurozone, which has now seen its average unemployment rate top 10 percent.

This barely hints at the levels of unemployment being reached. Spain has the second-worst unemployment rate in the region, behind Latvia’s 22.3 percent. All countries in the eurozone have seen unemployment rise in the last year, with Estonia, Latvia and Lithuania seeing unemployment levels more than double in that time. Unemployment of the under-25s stands at 43.8 percent in Spain. This is the worst in the region, and more than double the eurozone average.

A long hot summer may just do it though.

For Saudi Arabia at least its a good thing that oil prices seem likely to head skywards if Algerian and Libyan production falters :

Talk about an oil shock.

Nomura’s commodity analysts, led by Michael Lo, are calling for oil at $220 a barrel, if both Libya and Algeria were to stop oil production. Oil’s currently around $108.

Here’s the summary:

The closest comparison to the current MENA unrest is the 1990-91 Gulf War. If Libya and Algeria were to halt oil production together, prices could peak above US$220/bbl and OPEC spare capacity will be reduced to 2.1mmbbl/d, similar to levels seen during the Gulf war and when prices hit US$147/bbl in 2008. This could also result in a temporary demand destruction of some 2.0mmbbl/d globally.

Nomura’s using the 1990s Gulf War — which it thinks is the only real oil price ‘event’ to happen when Opec did not closely control oil prices — as a reference point for what could happen now. And according to the bank, we’re only in the first stage of a three-stage process based on that blueprint. Oh dear.

Thanks to our governments penchant for taxing anything and everything to hell and back, the current $108 dollars is painful enough but if we do see $220 a barrel then all bets are well and truly off both here and abroad.