The price for oil remains lower than it has been for some time now, due to the Saudis trying to break the Iran’s back by reducing their annual take in oil profits. Creating an oil glut has driven market prices down (except in Finland prices have increased due to extra taxation).
Saudi ‘to borrow to finance soaring deficit’, says report
Riyadh (AFP) – The Saudi budget deficit will be more than twice its own forecast, a leading research firm has said, forcing the kingdom into the debt market for the first time in more than a decade.
Hit by plunging crude prices, the world’s biggest oil exporter will post a deficit of $106 billion, compared with a government projection of $39 billion, Saudi firm Jadwa Research said in a report released late Tuesday.
The kingdom that exports 7.0 million barrels per day on average will see oil revenues fall by 35 percent to $171.8 billion in 2015, the quarterly report said.
Total revenues are forecast down 33.7 percent at $185 billion, while public spending is expected to remain almost unchanged at $290.9 billion.
Jadwa said the government is highly expected to return to the debt market for the first time in around 15 years despite its massive reserves.
More here. H/T: Fjordman