Petrostate

Diversification can successfully occur in limited circumstances, such as Mexico becoming part of the North American Free Trade Agreement, or Dubai leveraging its location to become a hub of commerce and tourism.

[19] Similarly, Michael Ross argues that “the case of Russia since 1998 illustrates how oil revenues can endanger a weak democracy by boosting the popularity of an elected incumbent, who gradually removes checks and balances on their own authority”.

For example, Kuwait, Saudi Arabia, United Arab Emirates, and Qatar have invested in education, healthcare, and public amenities to improve the quality of life for their citizens.

[10][11] It is also argued that they have no incentives to abide by rules regarding reduction of greenhouse gas emissions, and that consuming states have no ability to control the polluting petrostates.

[11] The extraction and production of oil can have significant environmental and ecological impacts, including pollution, habitat destruction, and greenhouse gas emissions.

Recent studies challenge the assumption that the transition to sustainable energy will lead to the decline of petrostates, suggesting that their future depends on production costs and social factors.

[25] Since the 2022 Russian invasion of Ukraine, Alexander Etkind has suggested that petrostates are engaging in wars because of the existential economic threat decarbonization poses to their rulers’ power and wealth.

[27] This is in spite of serious impacts of climate change in many extremely rich petrostates:[27] they have tended to avoid playing the victim and to align with other, less affected major polluters even when severely threatened.