A Changing World, Indeed

Here's a revealing story from the WSJ this morning. With oil futures hitting a record $100 yesterday, setting a new US benchmark, and surging demand in developing nations such as China to blame, economies, the balance of power and culture as we know it is changing.

The region's new wealth has triggered a bout of deal making that has bankers rushing to the petrostates of the Persian Gulf. McKinsey & Co. estimates that the world's biggest investors of petrodollars -- including state-owned vehicles known as sovereign-wealth funds -- now manage as much as $3.8 trillion in assets. The Abu Dhabi Investment Authority, which McKinsey estimates manages $900 billion in assets, is today among the world's largest financial-market participants -- about the same size as the Bank of Japan.

Underscoring the region's new global financial heft, Abu Dhabi recently swooped to the rescue of Citigroup Inc. with a $7.5 billion cash infusion as it struggled with write-downs from this year's credit crisis.

The piece goes on to illustrate how oil prices are lessening the US's effect in Darfur and Sudan, as well as with Iran's nuclear ambitions, and also touches on air fares. A good read.