The world of sports has undergone a profound transformation in recent decades, not only in terms of its global reach, but also in the way it is financed. One of the most prominent factors behind this transformation is the influence of petrodollars. This is more than evident in European football with PSG and Manchester City.
Why are Middle Eastern monarchies like Saudi Arabia, Qatar, and the United Arab Emirates—among others—looking to buy sports franchises? Is it to make more money? They already have “everything,” and a sports team isn’t as good a business in the 21st century as some clueless people think (unlikely in the 19th century). So what are these modern caliphates looking for?
To get an accurate answer, we must explore the origin of petrodollars in the global economy and analyze the probabilities, difficulties, advantages, and disadvantages of their investment in baseball.
On August 15, 1971, then-President of the United States, Richard Nixon, decreed the inconvertibility of the dollar to gold. In other words, the backing of the US currency was no longer the most precious metal on the planet: gold, and a novel concept began to be used (although for some specialists, an artificial and speculative one): the “paper dollar,” without any support beyond the paper itself, would be valued for being the currency in greatest circulation. And what happened to all that gold? That’s very interesting, but it’s not the purpose of this article.
From this moment on, a phenomenon known as “globalization” began, which in itself is an economic concept in its essence and development: the expansion of markets with transnational corporations that can operate in different jurisdictions (i.e., countries) as they see fit, of course.
Don’t think it’s a coincidence that, starting in the 1970s, soccer began to expand as the first global sport through FIFA, the image of the sport’s first superstar, Pelé, and color television. All of this was paid for by “green paper.” And the gold? Well… they made the FIFA World Cup plated in gold.
Technically, petrodollars are the revenue generated from the export of crude oil, primarily from oil-producing countries in the Middle East. This phenomenon emerged in the 1970s when OPEC (Organization of the Petroleum Exporting Countries) decided to raise oil prices and trade in US dollars. This resulted in a large accumulation of dollars in the reserves of oil-exporting countries, which became known as petrodollars.
In 2023, among the richest and most powerful companies in the world, for example, among the top ten, nine are technology companies, and the only one that handles a different sector is precisely the state-owned oil company of Saudi Arabia. This indicates two things: that Saudi Arabia is the most important country in oil (not because of its quantity but because of its quality, as it has light oil reserves) and that today, “without technology, there is no paradise.”
For more than 50 years, oil-producing countries have had a high capacity for savings and investment, but why have they now decided to reinvest their petrodollars? There are several answers to this question: I believe the main one is that a world with new energy sources is already on the horizon, such as electronics and batteries, and lithium is the most useful or sought-after new resource. So what to do with so much oil? It seems there is more than will be needed in the next 200 years.
We must remember that in the Middle East, the systems of government are monarchies, that is, dictatorships (and of course, there are sometimes elections). The royal family controls their country’s resources as their ancestors did. It seems they already know that although oil is not a renewable resource, it will not be the energy of the future. NASA knows that burning hydrocarbons will not get us to Mars, much less return.
The Brokers’ and Agents’ Play
There are professions dedicated to making money, tracking it, multiplying it, investing it, and reinvesting it. Also devalue it, multiply and divide it again, and like an endless spiral, profit from every transaction, exchange, currency control, and fluctuation. There are words that even we ordinary people don’t understand, and sports and entertainment are there for all of this. To “entertain” us while all this happens. Don’t panic: it’s better to be entertained than to suffer.
Brokers know that in the Middle East, royal families hold a lot of “green paper,” that it will lose its value due to macroeconomic fluctuations, that oil won’t last forever, and that the market must be moved, because the premise of the petrodollar, as we mentioned above, is its power lies in having the greatest circulation. So, they must invest in desert entertainment, because there’s little to do in deserts. In the Middle East, except in the tourism sector, there is very little urban development. Never limit yourself to just postcards of any city.
Before continuing, we must answer a key question: Why invest in sports if sports franchises aren’t as lucrative as other sectors such as technology, food, health, etc.? Because the oil-rich countries of the Middle East are dictatorships, and dictators love “bread and circuses,” and sports generate publicity and propaganda. I don’t really believe this is entirely true, but that’s the brokers’ argument, and it’s working out well for them.
It’s cheaper to buy a sports team than to pay for advertising year after year. Just as it’s cheaper to build a stadium with your brand name than to pay for advertising season after season for the rest of eternity. We already understand why Arsenal’s stadium is called Emirates Stadium. And you already know why Major League Baseball and other American sports stadiums have brand names.
And the agents? They’re just waiting for the Middle Eastern baseball leagues to be up and running so they can start luring all the minimum-wage MLB veterans to play in the Middle Eastern deserts for money no other baseball team would ever pay them.
Petrodollars are changing the world’s sports landscape
Petrodollar investment in global sports has been notable, with investors from oil-rich countries acquiring soccer clubs, Formula 1 teams, and, in some cases, venturing into baseball, although the latter has been less common. The challenges of investing with petrodollars in baseball would be complicated.
Baseball is a sport traditionally rooted in North America and some Latin American and Caribbean countries. The lack of experience and tradition in baseball can hinder the management and success of teams acquired by petrodollar investors.
Oil-rich countries often have a different sports culture, with a stronger focus on soccer or motorsports. Adapting to baseball culture can be challenging.
Advantages and Disadvantages of Investing in Baseball
Infrastructure Investment: Petrodollar investors can finance the construction of state-of-the-art facilities, which could improve the quality of teams and attract more talent.
Increased Competitiveness: Increased investment could make teams more competitive, which could attract a global audience and raise the standard of play in baseball.
Resistance to Foreign Investment: Some traditionalist fans may resist the idea of traditional baseball teams being acquired by foreign investors, which could lead to tensions and negative reactions.
Cultural Disconnect: The disconnect between the culture of investors and that of the sport could lead to a lack of identity and support from the local community.
Baseball Leagues in Asia and the Middle East are now a reality
In an exciting development for baseball lovers in Asia and the Middle East, the United International Baseball League (UIBL) was launched on July 26, 2022. This league, with an ambitious goal, plans to bring professional baseball to regions where cricket has long dominated. Two illustrious names, Mariano Rivera and Barry Larkin, prominent figures in the Baseball Hall of Fame, were announced as founding shareholders, underscoring the seriousness of the initiative.
Rather than building from scratch, the UIBL plans to remodel existing cricket fields in India, Pakistan, and the Middle East into baseball diamonds. This approach seeks to leverage existing infrastructure and accelerate the introduction of baseball in the region.
On August 18, 2022, the UIBL unveiled its inaugural plan by announcing that it would play nine of its first games at the prestigious Dubai International Cricket Stadium. This choice of venue underscores the league’s ambition to attract global attention and consolidate its presence in the Middle East.
Subsequently, in a move reflecting its growth and expansion, the UIBL decided to change its name to “Baseball United.” This transformation suggests the league’s aspiration to become a meeting point for baseball lovers in the region.
One of the significant milestones of this initiative was the partnership with the Pakistan Baseball Federation to host the West Asian edition of the 2023 Baseball Asia Cup in Islamabad, marking a major step forward in the development of baseball in the region.
The most recent news came in April 2023 when prominent Venezuelan Major League Baseball shortstop Elvis Andrus joined the Baseball United ownership group, underscoring the league’s growing appeal.
On May 15, 2023, Baseball United announced its first franchise, the Mumbai Cobras, and named former Major League Baseball All-Star Chris Sabo as its first manager. This marked a key step toward forming competitive teams in the league.
On May 30, 2023, the league’s second team, the Karachi Monarchs, was announced. Their name pays homage to both the Karachi Kings cricket team and the iconic Kansas City Monarchs of the American Negro Leagues. The rivalry between the Monarchs and the Cobras is shaping up to be one of the most exciting aspects of the league, likening it to the historic rivalry between the New York Yankees and the Boston Red Sox in American baseball.
The league completed its roster with the addition of the Dubai Wolves and Abu Dhabi Falcons, which will represent Dubai and Abu Dhabi, respectively. This final step ensures a strong presence in the UAE and solidifies Baseball United’s status as an emerging force in the world of international baseball.
English 
Spanish 