The Saudi Enigma: MBS’s Arabia, From Oil Barrel to Green Leadership?

The Saudi Enigma: MBS’s Arabia, From Oil Barrel to Green Leadership?

A Case Study of the NEOM Project

Saudi Arabia (SA), the world’s leading oil exporter (The Observatory of Economic Complexity, 2025), aims to transform itself into a key player, or even a leader, in the global energy transition (Saudi Green Initiatives, 2025) –a paradox that embodies the core of the contemporary Saudi enigma. 

Since 2016, under the impetus of Crown Prince Mohammed bin Salman (MBS), the kingdom has deployed an ambitious climate diplomacy, framed by Vision 2030. This roadmap aims not only to diversify the economy but also to rejuvenate the country’s international image. This strategy is materialized by flagship projects: notably the NEOM Green Hydrogen Company (NGHC) complex, presented as the world’s largest integrated green hydrogen site. 

Nevertheless, behind this technological showcase lies an ambivalent structural reality. The Kingdom maintains its position as the world’s largest financier of the fossil fuel industry, with subsidies reaching nearly $7,340 USD per capita in 2022 (IMF). 

This major paradox fuels criticism: do Saudi Arabia’s grand projects represent an authentic energy bifurcation, or a sophisticated exercise in geopolitical greenwashing? 

I. The Narrative of Modernity: When Technology Serves Legitimation 

The NEOM Green Hydrogen Company (NGHC) project distinguishes itself through its sheer technical ambition. With an investment of $8.4 billion, it plans to integrate 4 GW of wind and solar power to supply a giant 2.2 GW electrolyzer(an unprecedented capacity), aiming to produce 1.2 million tonnes of green ammonia per year (SP Global, 2024). The innovation relies on energy coupling (daytime solar / nocturnal winds), enabling a continuous supply in a desert environment (Oxford Business Group, 2024). 

This system is not focused on domestic autonomy but on massive exportation, primarily to Europe and Asia. 

The NGHC project is not a simple diversification; it’s a strategic manoeuvre aimed at ensuring Saudi Arabia retains its status as a global energy power (‘geoeconomic centrality’) by replacing its historical product, oil, with new green vectors like hydrogen and ammonia (Al-Qahtani et al., 2023). The initial risk of oversizing and cost overruns is the price paid to maintain this logic of scale. 

Green hydrogen becomes the central lever of an authoritarian modernization (Henderson, 2023). The project is carefully staged at major international forums (COP, Davos), fuelling what Henderson (2023) calls a ‘green nationalism.’Here, ecology is instrumentalized for internal legitimation (image of growth) and external legitimation (international responsibility). 

NGHC is thus a media object designed to convey a transition without rupture: the tools change, but the fundamentals of the economic model (exportation, state control) and the structural paradox (maintenance of fossil subsidies) remain unchanged. It allows the Kingdom to project modernity and a climate commitment without challenging the base of its power. 

Despite the ambition of a MENA hydrogen corridor, the NGHC project is based on a logic of asymmetrical centralization. Conceived as a strategic logistical hub aiming to connect with neighbouring countries, specifically Egypt and the UAE, it reproduces the energy hierarchies of the oil era. 

In this dynamic, it is the Kingdom that sets the terms, priorities, and standards (Scita, 2020). Far from promoting egalitarian regional integration, NEOM consolidates a Saudi centrality. Under the guise of cooperation, a vertical recentralization of energy power is taking place, allowing the dominant player in Riyadh to strengthen its influence over the future architectures of green energy production and distribution.  

II. The Economy of Illusion: Structural Limits of the Green Model 

The project is currently grappling with significant financial fragility. The viability of the NEOM model rests on striking financial instability. 

The project budget has surged by over 68% between 2022 and 2024, reaching $8.4 billion (Reuters, 2024). This cost explosion, linked to technical complexity and inflation, makes NEOM a speculative gamble rather than a replicable model. 

The uncertainty is compounded by the absence of a mature market. Green hydrogen remains three to five times more expensive than fossil-based hydrogen (PwC, 2024). The project, which relies on a single purchase agreement (TotalEnergies), is exposed to major commercial uncertainties due to the lack of a global economic framework (carbon taxation, sustainable subsidies). 

On a technical level, the promise of a breakthrough amounts to a technocratic fiction. The production process accumulates significant energy losses and logistical costs, not to mention the uncertainty linked to resource intermittency and the necessity for costly, immature storage systems (Saudi Energy Consulting, 2025). 

Researchers fear a risk of technological lock-in within an expensive and heavily subsidized sector, making NEOM a political artifact rather than a structural lever. 

Beyond technical matters, NEOM embodies a transition imposed from above, without citizen consultation. This transition is blind to the inequality dynamics it reproduces (World Development, 2024). 

The emblematic case of the forced evictions of the Huwaitat tribe illustrates this logic of invisibilization: confiscated lands, lack of compensation, and limited media coverage ( ECDHR, 2025). This process replicates what David Harvey calls ‘accumulation by dispossession’ (2004). This “green extractivism,” masked by sustainable modernity, enacts a profound depoliticization of energy choices. The absence of mechanisms to guarantee inclusion or the equitable redistribution of benefits means that the transition is a revolution without social transformation, where only the instruments change, but not the relations of domination. 

III. The Price of Transition 

NEOM is a key instrument in the global normative battle over clean hydrogen. In a context of regulatory vacuum (certifications, EU taxonomies), Saudi Arabia seeks to pre-empt international standards to shape a framework favorable to its interests (Haytayan, 2025). 

This strategy relies on proactive regulatory diplomacy conducted via bilateral agreements, with the EU, Germany, South Korea, and coalitions through the Hydrogen Diplomacy Office). Here, the aim is to actively participate in the rule-making process to influence social and environmental criteria. By anticipating eligibility frameworks, Riyadh can impose its own benchmarks and bypass constraints (human rights, carbon traceability). NEOM is a device for pre-emptive diplomacy that reveals an imbalance in green governance: the producers become those who define the rules of the game. 

The export ambition of NEOM implies an apparent interdependence between producers (SA) and importers (EU, Japan). However, this interdependence is profoundly asymmetrical. Importing countries, constrained by their climate objectives, must align themselves with an offer defined by actors with low transparency (Public Investment Fund, IEEFA, 2024). 

This imbalance recalls the logic of the oil regime: contractual opacity, unilateral price setting. The hydrogen economy risks reproducing fossil dependency architectures under a green guise (Energy Monitor, 2024). 

Contrary to the ideal of a distributed transition, NEOM consolidates a vertical model, dominated by a few centralized hubs, thereby marginalizing alternative scenarios (short supply chains, regional autonomy) in favor of a globalized techno-industrial imperative. 

On a global scale, NEOM Hydrogen raises questions about cross-border energy justice. While importing countries benefit from certified said-green volumes, the environmental, social, and water costs of this production are externalized to already strained desert territories. 

Massive electrolysis requires enormous quantities of freshwater and mobilizes critical resources in politically non-transparent areas. Yet, international agreements on hydrogen remain silent on mechanisms for compensation or equity. 

The energy transition thus takes the appearance of a global but disembodied process, where North-South relations remain unchanged. Saudi Arabia uses its position to export a ‘clean’ product to the Global North, while externalizing the risks and consolidating a structurally unequal configuration. 

BIBLIOGRAPHY 

Haytayan, L. (2025). Regional cooperation: The backbone of MENA’s energy transition. Natural Resource Governance Institute. 

Henderson, C. J. V. (2023). Unjust transitions: the Gulf states’ role in the “sustainability shift” 

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Scita, Rossana and Raimondi, Pier Paolo and Noussan, Michel, Green Hydrogen: The Holy Grail of Decarbonisation? An Analysis of the Technical and Geopolitical Implications of the Future Hydrogen Economy (October 12, 2020). FEEM Working Paper No. 13.2020, Available at SSRN: https://ssrn.com/abstract=3709789 or http://dx.doi.org/10.2139/ssrn.3709789  

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Saudi Energy Consulting. (2025). NEOM Project Tracker and Risks Report. [online] Available at: https://saudienergyconsulting.com/  

DeiTabase, University of Michigan. (2024). NEOM’s Shadow. [Blog post] Available at: https://limos.engin.umich.edu/deitabase/2024/05/16/neoms-shadow/ 

Energy Monitor (2024). Global Hydrogen Corridors: Power, Pipelines and Politics. 

Harvey, D. (2004). The “New Imperialism”: Accumulation by Dispossession. Actuel Marx, No 35(1), 71-90. https://doi.org/10.3917/amx.035.0071. 

Al-Qahtani, A., Al-Sharif, M. and El-Katiri, L. (2023). GCC Energy Strategies and Diversification. Energies, 18(4), pp. 491–512. Energies. (2023). Strategies of Energy Transition in the Gulf States. Energies, 16(768). 

The Observatory of Economic Complexity (OEC) (2025) Crude Petroleum | Bilateral Product | Reporter: Saudi Arabia. Available at: https://oec.world/en/profile/bilateral-product/crude-petroleum/reporter/sau (Accessed: 24 November 2025).