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oil is an extremely liquid asset. and not just literally



Not really -- if you are in control of Oil wealth you are most likely part of a family that runs a country. Your fortune is dependent on staying in power and in favor of the patriarch. If there were to be a cultural revolution, uprising or falling out, you can't jump on your g6 and fly to whatever western country you pick and bring your oil with you like you can with stocks, bonds and other globally traded holdings.


If you are in control of Oil wealth because you are part of a family that runs a country, you most likely already own stocks, bonds and importantly real estate in a number of safe countries, so you can flee there when your dynasty is toppled.


Yes, but you'll "only" control those assets, not the oil that supposedly made you the richest man on Earth.


No good is a liquid asset. You realize it takes weeks to get from crude oil to something you can pump into your car (including shipping time), right?


when pumped out of the ground and put into the holding tank of a giant ocean-going ship it sure is.

but I was referring to hereditary mineral rights, which is really more about political power and the (very expensive) maintenance of an oppressive regime. those mineral rights eventually convert into oil on tanker ships but it's really incredibly precarious and a single political shift (internal revolution, invading army, etc.) makes it all vanish in a heartbeat.

the amount of oil-on-ships wealth that an Arab tyrant has on hand at any given time is relatively modest. most of the wealth is future claims to continue selling that oil, and that's not a very liquid form of wealth at all.


Only literally. It is buried in miles of rock and the transaction cost to turn it into cash is very large.


Not for Saudi Arabia it isn't.

Though that's much of Venezuela's present problem.

Also the U.S. and Canada. Fracking, deep water, tar sands.




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