Thursday, December 25, 2014

Saudi foresees a large deficit in 2015 due to oil prices – Romandie.com

Saudi foresees a large deficit in 2015 due to oil prices – Romandie.com


Riyadh – Saudi Arabia, the countries largest oil exporter, has taken into account the price of crude tumble Thursday by providing a large deficit for its 2015 budget, while continuing to increase spending

. The deficit of $ 38.6 billion expected for next year is the largest ever planned by the Saudi kingdom, leader of OPEC. It is also the first since 2011.

In an extraordinary council, the government agreed on a budget based on spending of 860 billion riyals (229.3 billion dollars) and revenues of 715 billion riyals (US $ 190.7 billion).

The expenses were slightly up from 855 billion riyals in the budget this year, the statement issued at the end of this meeting chaired by Crown Prince Salman bin Abdul Aziz. While revenue appear down 140 billion riyals ($ 37.3 billion) from the forecast in 2014.

This decline is related to the fall in oil prices, which have lost about half of their value since mid-June amid a glut of supply, a slowdown in global demand for oil and a strong dollar.

Sign the impact of an economic slump that pulls the oil up to 90% of its revenues, King Abdullah called on his government to rationalize spending and recommended an accurate and efficient implementation of the budget.

You are aware of the slow growth of the world economy and developments in the oil market that led to the sharp decline in crude prices, said the sovereign at his ministers.

The International Monetary Fund (IMF) warned that this collapse would push in the red the 2015 budget.

If oil prices remain at current levels around $ 60 a barrel for the Brent, the Kingdom is expected to lose half of its revenues were $ 276 billion in 2013.

Minister of Finance Ibrahim al-Assaf has yet said last week that Riyadh would maintain a high pace spending on development projects despite falling oil prices

-. Preserving social peace –

Saudi Arabia consists of large foreign exchange reserves and reduced its public debt through the oil boom of recent years, which gives the defense lines for lean years, he said.

The kingdom, which pumps about 9, 6 million barrels per day (bpd), can indeed draw on reserves estimated at 750 billion dollars.

King Abdullah has also authorized the Ministry of Finance to draw on reserves or resort to borrowing on the market to address the budget deficit.

In its statement, the Government emphasizes that it will continue to fund education development projects and programs, and health and social services, and create more jobs for citizens.

According to analysts, the Saudi authorities are anxious to preserve social peace in a regional environment marked by unrest in the Arab Spring and the rise of jihadist groups, the organization of Islamic state raging in Iraq and Syria.

The rating agency Standard and Poor’s lowered its outlook for Saudi Arabia from positive to stable after the decline in crude prices. But it also affirmed its highest rating for Ryad to favor its strong financial position.

Crude oil ended down Wednesday in New York after the announcement of an unexpected increase in inventories Americans, who raised concerns about the oversupply

(© AFP / December 25, 2014 2:09 p.m.) <-

(AFP / 25.12.2014 14.!: 36) ^ ->
 


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