Countries with a lot of oil are economically vulnerable when the price of oil collapses. That's obvious. But how vulnerable are they relative to one another? That's what a new set of rankings from Standard & Poor's tries to do. It's an interesting list, as <a href="http://www.thenational.ae/article/20090505/BUSINESS/705059889">I reported yesterday</a>. But as a few people have pointed out, distinguishing between these countries' vulnerability to oil prices becomes pretty much a moot point if oil prices start to crash, as they did last year. In a panic, everyone suffers.<br/><br/>The surprising thing about the index, at least from a Gulf-centric perspective, wasn't that Bahrain and Saudi Arabia topped the list (although it does strike me as a bit odd that Bahrain is apparently so vulnerable, despite its relative lack of oil reserves) but that Abu Dhabi ranked so low. It came in 13th.<br/><br/>It appears the main reason for this is a discrepancy was a quirk in the data: on a few key measures involveing external trade, the folks at S&P used UAE-wide figures, not Abu-Dhabi-specific ones. That meant Abu Dhabi's reliance on oil was tempered significantly by the diverse range of economic activities in the rest of the country. <br/><br/>"The reason that Abu Dhabi comes out as less vulnerable in the overall index is because it has a low value on the external vulnerability scale," <b>Mohsin Khan</b>, a senior fellow at the Peterson Institute for International Economics in Washington, D.C. told me in an e-mail. "And the reason for this is clear--for Abu Dhabi the index is based on the share of oil and gas in <b>total</b> exports of the UAE (including, of course, Dubai as well as the other non-oil exporting emirates). This share is 34%. If you calculated the index properly as the share of oil and gas in Abu Dhabi's exports, my guess is you would get a value of at least 70% (about the same as Saudi Arabia). Plugging that value back would greatly increase Abu Dhabi's overall vulnerability."<br/><br/>Interestingly, the S&P report also looked at vulnerability in terms of a country's ability to maintain current budget spending and balance its international trade accounts given a lower oil price. Analysts and economists typically call these "break-even" oil prices. Mr Khan was kind enough to send along recent break-even estimates for a number of oil-producing countries in the region:<br/><br/>