In Riyadh the mood is tense; everyone is on edge wondering what will happen on Friday – the date the Saudi people have chosen for their revolution. The days building up to Friday so far have not been as reassuring as one would like.

On 4 March, there were protests in the eastern region and a smaller protest here in Riyadh. The protests in the eastern region were mainly to call for the release of Sheikh Tawfiq al-Amer, who had been detained after giving a sermon calling for a constitutional monarchy.

The protest in Riyadh was started by a young Sunni man, Mohammed al-Wadani, who had uploaded a YouTube video a few days before, explaining why the monarchy has to fall. After the protests, 26 people were detained in the eastern region and al-Wadani was taken in soon after he held up his sign near a major mosque in Riyadh.

It’s not just the people who are on edge; apparently the government is also taking this upcoming Friday seriously. Surprisingly, Sheikh Amer was released on Sunday, while usually political detentions take much longer.

All this week, government agencies have been issuing statements banning protests. First it was the interior ministry that promised to take all measures necessary to prevent protests. Then the highest religious establishment, the Council of Senior Clerics, deemed protests and petitions as un-Islamic. The Shura Council, our government-appointed pretend-parliament, also threw its weight behind the interior ministry’s ban and the religious decree of prohibition. But you can’t blame the clerics or the Shura for making these statements – the status quo is what’s keeping them in power and comfortable.

Saudis are now faced with a ban on any form of demonstration, and the blocking and censorship of petitions. Moreover, four newspaper writers who had signed one of the petitions are now suspended.

Saudis feel cornered, with little means of self-expression and at the same time exposed to news and opinions that only add salt to the wound. For example, Prince Talal Bin Abdul Aziz, the king’s half-brother, went on BBC Arabic TV to state his support for a constitutional monarchy and warn that anything less will lead to “evils” (his word).

Meanwhile, a newspaper reported that an expatriate was sentenced to 14 months in prison and 80 lashes for stealing part of a chicken from a restaurant. In response to the news, Abdulrahman Allahim, an award-winning Saudi human rights lawyer, tweeted that in his experience he had never come across a case in Saudi courts where a defendant was given a verdict of not guilty.

In Jeddah, a committee that has spent more than a year investigating the disappearance of millions of public funds assigned to the municipality to build a sewerage system has yet to make one formal accusation against anyone.

Another article revealed that the unemployment benefits recently decreed by the king have been whittled down from 3,000 riyals (£490) a month to 1,000 riyals (£165) and will probably only be given to unemployed men but not women.

The official unemployment rate of men is 10%, although many estimate it to be higher. The unemployment rate for women is yet to be officially announced but a study in 2010 estimated it at more than 26%.

It’s also estimated that about 60% of the population is under 30. These young, unemployed people live with many constrictions on their freedom. In addition to extreme gender segregation, single men are banned from entering shopping malls, and women cannot process their own papers, get a job or even access transport without male accompaniment and approval.

There’s no denying that the country is fertile ground for a revolution. However, I am concerned that the revolution might be hijacked by Islamists. Sa’ad al-Faqih, a London-based anti-monarchy activist, is claiming the revolution for himself. His TV programme, which is accessible via satellite in Saudi, is organising protest locations and revving up viewers to participate. Another contender is the new Islamic Umma party, whose founding members are imprisoned until they renounce their political aspirations (they have so far refused). Although the founding members are not free, the party’s online activity grows day by day. Both groups make use of a rhetoric that is dear to many average Saudis – attacking US foreign policy and the royal family’s misuse of the nation’s wealth while threading both issues within an Islamic theme.

On the other hand, the king is popular. All the petitions call for a constitutional monarchy, rather than the fall of the monarchy. Those who signed the petitions are mostly loyal to the king, but want access to decision-making and an end to corruption.

Also, many of the signatories are thinkers, writers and academics – generally an elite group of Saudis. From what I’ve read, nothing indicates they will go out to protest. However, one political activist who has been imprisoned several times for writing petitions was noticeably absent from recent lists of signatories. When a close friend of mine asked him why, he said, “now is not the time to sign petitions, now is the time to act”.

It’s very difficult to predict what will happen on Friday. My guess is that there will be protests. The larger protests will be in the eastern region and mostly by Shia Muslims. I also expect smaller protests in Riyadh and Jeddah. What tactics the security forces use will greatly influence not only the demonstrators but also the people watching from their homes. If undue violence is used against the demonstrators, it could possibly ignite the same fuse that led to full-blown revolutions in Tunisia, Egypt and Libya.

Whether or not it comes to that, we as a people have changed for ever. No longer do I see the frightened hushing of political discussion – everyone is saying what they believe and aspire for out in the open without fear. As Fouad Alfarhan, a prominent Saudi activist, tweeted:

“Probably not much will happen, however the biggest gain is the awareness raised in a large faction of our young people of their human and political rights in this post-Bouazizi world.”

With the recent turmoil across North Africa and the Gulf, investors are now becoming increasingly concerned that the ‘political contagion,’ as the wave of upheaval has come to be known, may flow over into Saudi Arabia as well.

The worry is that the protests in various parts of the Arab World will embolden Saudi youths, or the minority Shiites in the east, to revolt in a similar fashion.

The country supplies about 12% of global oil production and sits on at least a fifth of the world’s oil reserves.

By being on the eastern border of the Kingdom, Bahrain is near key parts of the country’s crude reserves. Although doubtful that Saudi Arabia would be drawn into the contagion, “the fear factor could potentially force oil prices higher and leave the equity markets lower”, Gary Dugan, CIO at Emirates NBD, told CNBC.

Using information from the Energy Information Administration (EIA) for 2009: If you take of Saudi Arabia, and add to that other major oil exporters in the region that have seen turmoil in recent days, such as OPEC members Libya and Algeria, you’re looking at roughly 16% of total oil production that could be at risk. Pricing the risk premium in the current environment will prove to be a daunting guessing game for traders.

Saudi Arabia faces a problem that was a major driver of protests in Tunisia and Egypt to begin with: Youth unemployment. Data by the Central Department of Statistics & Information (CDSI) estimates that 39% of Saudis between the age of 20 and 24 were unemployed in 2009 – up from 28.5% in 2000. But in its most recent report, Saudi Banque Fransi adds that the Kingdom has an “enormous stash of oil wealth it can draw on to finance schemes to sooth popular frustrations without exerting too much strain on its budget”. Saudi Arabia held an estimated $440 billion in net foreign assets in 2010.

Amid the ongoing geopolitical instability, Dugan points out that he has seen “international investors largely retreat from the MENA markets with only hedge funds opportunistically buying local bonds at low price levels.” Emerging market equity funds had net outflows of $5.45 billion last week, according to EPFR.

Indeed, the political future of Saudi Arabia is far from certain. King Abdullah is 87 years old and has spent a lot of time abroad recently for treatment. The crown prince is an octogenarian as well, while the plan for succession is unclear. Angus Blair, head of research at Beltone Financial, told CNBC that “Saudi Arabia will not be excluded from the profound changes sweeping through the Arab world”. He also expects to see reforms through the Shura Council, which is “likely to be awarded more powers as part of a long term program of increased devolution of power”.

The cost of insuring exposure to Saudi Arabia risk for a five-year period rose 15 bps to 140 bps on Friday, according to Markit.

By Yousef Gamal El-Din

The new political party founding members, arrested by Saudi authorities, refuse to compromise in withdrawing their demands for reforms.

The Umma Islamic Party, formed earlier this month by 10 university professors, political activists and business people, have asked the country’s rulers to start a dialogue on reform, including improving the status of women.

The initiative for forming the party was taken as pro-democracy movements have been spreading across Arab and African countries in recent weeks. The move came despite the kingdom’s ban on forming political parties.

It is not clear how many members were arrested on Wednesday, but party officials said that the detainees have declined to sign a pledge asked by the authorities’ on Friday to withdraw demands in return for their release.

One of the founders, Sheikh Mohammed bin Ghanim al-Qahtani, in a statement emailed to AP, said that he and the others have committed no crime to justify the arrest and that they were exercising their legitimate political rights.

The arrests will only “increase the political tension among the Saudi people who, like other Arabs, aspire to real political reform based on their right to freely express their opinions, hold political gatherings and elect their lawmakers,” he said.

On Thursday, Saudi Prince Talal bin Abdul-Aziz warned that his oil-rich country might be next in being swept over by a popular uprising if it does not act on reforms.

He said that it is not too late for the government to avoid a popular uprising if it adopts measures to step up the pace of reforms.

Saudi Arabia does not have a parliament. Instead, it has a consultative Shura Council, which is an entirely appointed body, merely aimed at providing the king with consultations on policies, laws, and other matters.