Saudi Arabia Needs Pricier Oil to Balance Its Budget, IMF Says
- Budget deficit likely with this year’s breakeven seen at $80.9
- Kingdom still dependent on petrodollars to power expenditure
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The International Monetary Fund expects Saudi Arabia won’t balance its budget if oil is below $80 a barrel, a revision that means the kingdom will move back into fiscal deficit after its first surplus in almost a decade.
The fund’s latest projections put this year’s Saudi breakeven oil price at $80.9, up by more than a fifth from what it had forecast in October. Though an improvement from the past two years, it’s above the average for 2000-2019 and contrasts with a better outlook for some other top regional energy producers such as the United Arab Emirates.