Despite all the changes, Saudi Arabia continues to remain the lynchpin of the global energy balance. It continues to play a balancing act — leaving a sobering impact on the global energy markets. And it has been doing so for more than three decades now.

When energy supply is threatened, today as in 1980, the world turns to Saudi Arabia for help. Early in the 80s, two major events hit the energy world. The revolution in Tehran altered the regional geopolitical realities of the day and this was soon followed by the decade long war between two major oil producing nations — Iran of the ayatollahs and Iraq of Saddam.

And this resulted in outage of millions of barrels of oil from the rather ‘tight’ global supplies. A sort of ‘energy shock’ was definitely in making. It was at this stage that the Kingdom, the ‘swing producer of the 80s’ stepped in to rein in the ominous developments. It jacked up output to 9.90 million barrels per day, so as to meet the emerging crisis that could have otherwise engulfed the world.

Some three decades later, Saudi Arabia is required to play the same role again. And it did so — jacking up its output again to almost the same level — 9.85 million bpd in July — to balance the deteriorating supply side of the global energy balance due to the Libyan outage. Only Saudi Arabia had this capacity and indeed the will to step in and plug the widening gap. The Saudi action on both the occasions, today and some thirty years ago, prevented a major political crisis from turning into a severe and prolonged oil price spike.

A very significant, costly, yet thankless, role over a long period of thirty years!

However, similarities seem ending there. Most agree that the oil market in 2012 will be very different to that in 1982. The 80’s were indeed a different world altogether. China had barely begun its economic transformation. West was still the focal point of the world, while the US was locked in a bitter yet costly arms race with the now defunct Soviet Union (USSR) and globalization was just a remote, academic, possibility.

After the 1980 price spike, oil prices fell into a long slump. A combination of improvements in energy efficiency, consumer reaction to high prices and new production from Alaska, the North Sea and Mexico, led to a 20-year supply surplus. The market for OPEC oil dried up and by 1985 Saudi Arabia was producing just a third of its 1980 peak.

There’s little danger of this history repeating now. Non-OPEC supply is growing only incrementally, yet is nowhere near the scale of the new wave of 1980s production. In rich countries, oil consumption is still falling for similar reasons as 30 years ago. However, rapid demand growth in the developing world will more than offset this, even if oil prices remain high. Even after Libyan oil exports are restored, the world will probably need more oil every year.

And interestingly, Russia is competing, rather aggressively today, with Saudi Arabia on the energy front. Moscow just last month matched a post-Soviet output record by pumping 10.26 million barrels of crude oil per day, retaining top producer slot despite the rapidly closing gap with Saudi Arabia. Russia also pumped 10.26 million bpd in May this year and in October 2010. In June the output stood at 10.2 million bpd.

Meanwhile, Saudi Arabia pumped 9.8 million bpd in June, an increase of as much as 900,000 bpd in response to the loss of Libyan supply after it failed to persuade OPEC of the need for a coordinated increase.

But similarities end there. While the Kingdom had the spare capacity to ramp up production by nearly 10 percent in a month, Russia seems struggling to grow by just a few percent a year.

Analysts have forecast that in 2011, Russian production will average 10.26 million bpd, in line with July’s level, for a total gain of roughly 1.1 percent. Total output is up around 1.2 percent on a daily basis from July 2010 levels and up around 0.8 percent since the beginning of this year, Reuters data showed.

Russia’s Soviet-era oil heartland is on the decline, and the government is working to provide incentives to coax capital-intensive new fields on line.

Deputy Prime Minister Igor Sechin, Russia’s oil tsar, has put forward the case for multi-billion dollar foreign investment in harsh, remote new oil provinces as a means to guarantee supply during times of shock.

And amidst all these developments, Saudi Arabia continues to face challenges from within the OPEC too. Venezuela is said to be looking to develop vast deposits of unconventional extra-heavy crude, more difficult and expensive to extract from the ground and to process than oil found elsewhere.

Earlier last month, OPEC recognized Venezuela as the country with the biggest proven oil reserves in the world, saying that with 296.5 billion barrels it now surpasses Saudi Arabia. Yet this also meant new quota struggle within OPEC in the months ahead.

Last week, President Hugo Chavez said that Venezuela’s oil production quota within OPEC should increase now that its proven crude reserves have grown. “The more reserves you have, the higher the quota you have,” Chavez underlined.

“A reformatting of the quotas has to begin, progressively of course, and Venezuela has to begin to receive higher quotas,” Chavez said.

Venezuela aims to more than double its oil production within a decade. The state oil company has set goals of producing more than 4 million barrels of crude a day in 2015 and 6 million barrels a day in 2019.

Although the Venezuelan government says it is currently producing about 3 million barrels a day, the International Energy Agency and OPEC maintain its actual output at about 2.8 million barrels a day.

Yet despite all the challenges, the consistency in the Saudi role as global oil supply lynchpin for 30 years has been truly remarkable. Despite the challenges from within and indeed without, if it can still fulfill that role in another 30 years, it will be a miracle. And the miracle seems ready to happen!