I think Lord Hurd is right here: you can't be all "Saudi sort out your reforms" but at the same time say "Saudi, give us more oil".
Of course, I think we've seen evidence that the Saudi Royal family would like their country to be different, but the Saudi people wouldn't allow it as far as I can see.
In which case I think where it is possible to promote democracy in countries like Libya, Egypt, Tunisia, then we should do so. As for Saudi (or China, or other nations) - we just have to wait for the people to revolt.
http://www.youtube.com/watch?v=729MBWnAYO4