What would happen to world supply curve for oil if a revolution in Saudi Arabia led to declining the oil production?

 Saudi Arabia, the head of Organization of Petroleum Exporting Countries (OPEC), also called Central Bank 

of oil. This desert Kingdom was seen as a reliable and supremely safe source of oil.

 If we go through the geological and market realities, it becomes quickly clear that Saudi Arabia remains the indispensable country of oil. The Saudi Arabia not only
the export more oil than anyone else, but also has more reserve than anyone else. Fully one-quarter of the world’s proven reserve lies in Saudi Arabia. Four neighbors Iran, Iraq, The United Arab Emirates and Kuwait, each about one-tenth. Russia Nigeria and Alaska put together do not match Saudi reserves.

             
Saudi Arabia plays an important role as an oil producer country, unlike other countries the Saudi keep several barrels per day of idle capacity on hand for emergencies, and according to statement of an official of Saudi Aramco that country can raise its output rapidly. Today the Saudi Arabia is the only country with much space capacity available

 

During the Iran-Iraq war, when output from both countries were upset, during and after first Gulf war, when 

output from Iraq and Kuwait was lost, and reduction of output of oil from Nigeria and attack on Iraq 

interrupted oil production, where there is the Saudi reserve supported the market of oil and due to these 

circumstances Saudi government moderate the oil prices as well.

            

 The world is clearly well equipped to handle a supply shock than it was during the unstable circumstances as 

stated above the world is worried about the supply shock or inflation, in this regard the “Strategic Reserves” 

are being maintained. These strategic petroleum stocks cannot be drawn down all at once, if any thing takes a 

wrong turn with the oil infrastructure that falls down the Saudi output. There is an obvious point, of course, 

that this particular policy will not be worth very much, if there is a serious supply crises inside the 

Kingdom.                          

            

 Building new surplus will definitely take long time until then the Saudi Arabia’s oil supply will remain a 

strategic weakness for the world economy. With help of following chart, we can easily realize that the Saudi 

Arabia is a leading country among all the (OPEC) countries and around the world as well.

Declining in oil production will suffer the oil supply to international market and the supply curve will shift to decreasing side.