Saudi Arabia ready for multiple oil price scenarios, economy minister says

Saudi Arabia is always ready for multiple oil price scenarios, and budgets are driven by priorities, the country’s economy minister said on Tuesday.

“We’re always ready for scenarios – multiple scenarios, and we have buffers,” Faisal Alibrahim told an audience at the Qatar Economic Forum in Doha.

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“We have the long-term fiscal planning and medium-term frameworks that help us adjust depending on what scenario actually plays out,” he said.

The International Monetary Fund and economists estimate Riyadh needs oil prices of over $90 a barrel to balance its budget. Benchmark Brent prices have been trading in the mid-$60s this month.

While Saudi Arabia funds its Vision 2030 reform program off budget, the government needs to spend on mammoth infrastructure projects linked to the programme, which aims to wean the economy off its self-declared “oil addiction”.

It is also hosting the Expo in 2030 and the World Cup in 2034.

Saudi Arabia, the world’s largest oil exporter, was among the largest emerging market debt issuers last year and the government has already raised $14.4bn in bonds this year.