146THE POLITICS OF REFORMBAHRAINBahrain is the Gulf state least able to afford subsidies but the one most
politically dependent on them. The island kingdom is the most volatile
country in the Gulf, as was demonstrated by its mass Arab Spring
uprising in 2011. Bahrain remains politically and economically tethered
to Saudi Arabia, which— in exchange for its influence over Bahraini
affairs— has provided the tiny state with at least half the production of
its giant Abu Safah oilfield since 1972. This has been crucial for Bahrain’s
survival, as it has very little of its own oil or gas.
However, as Saudi Arabia goes, so goes Bahrain. When the Saudi
kingdom began to raise prices in 2016, Bahrain swung into line. In
March 2016, the island kingdom launched a series of subsidy reforms
targeting electricity, water, and transportation fuel. As in Qatar and the
UAE, citizens were exempted from increases in household water and
power prices, but water and electricity prices for noncitizens were to
increase until they reflected actual costs sometime in 2019.^26 Since util-
ity prices for citizens didn’t change, expatriates effectively began cross-
subsidizing the consumption of Bahraini nationals. Bahrain also raised
transportation fuel prices for the first time in thirty years (table 9.1). The
price of natural gas was also raised in 2015 from $2.25 to $2.50 per
mmbtu, with an annual increase of $0.25 planned until prices reach
$4 per mmbtu by 2021.^27
The chronic sectarian unrest that has plagued Bahrain for decades
showed no sign of abating. Protests by disenfranchised Shia citizens
continued, and in 2017 a trio of underground rebel groups mounted
small- scale bombings and attacks on security forces.^28 Unlike in Kuwait,
where political violence inspired the ruling family to redouble efforts to
maintain Shia integration, strife in Bahrain has only deepened margin-
alization. But since Bahrain’s conflict has few, if any, links to subsidy
retraction, authorities appear prepared to press ahead.