Kingdom Budget Surplus

Saudi Arabia almost doubles income forecast, announcing a budget surplus of $81.6 billion for 2011.

Saudi Arabia has posted an $81.6 billion budget surplus for 2011 as its income beat forecasts by more than double, official figures suggest.

Revenues grew to $296 billion, although ministers had forecast $144 billion, according to the Saudi Arabian finance ministry. Most of the growth in revenue was driven by oil production, which accounts for around 90 per cent of the country’s exports.

Saudi plans to reduce spending in 2012 to $184 billion after officials said they expect the surplus to fall to just $3 billion next year.

However, analysts see this as another conservative forecast as the country has a history of using relatively low oil prices of around $60 a barrel as the basis for its forecasts. The average price of crude oil in the 12 months to 26 December 2011 has been $94.96 a barrel.

Saudi Arabia did pump more oil in 2011 after supplies from Libya were disrupted by the conflict, which ended in the ousting of Muammar Gaddafi. The country increased production to 10.047 million barrels per day from its planned quota of 8.05 million barrels per day.