Saudi Arabia won’t cut oil production, 2015 growth forecast at 3.2 per cent: Report
Saudi Arabia will not cut its oil output, which increased by four per cent in the first seven months of the current year to 10.2 million barrels a day, according to a new report.
The report played down the importance of any possible slowdown in shale oil production in 2016 as competition between OPEC members for market share will keep Saudi Arabia’s average production in the vicinity of 10.1m barrels a day.
According to the report by Jadwa Investment, the oil-rich nation’s public debt is projected to surge to $70 billion to comprise 10.1 per cent of gross domestic product in 2016.
It also assured that the country’s massive foreign currency reserves will serve as a buffer, enabling the kingdom to gradually reduce public expenditure in the event oil prices maintained their relatively low prices.
The report, published by Al-Sharq al-Awsat, indicates that the Saudi government will offset a high budget deficit using foreign reserves and issuing debt bonds and instruments.
With regards to growth prospects, Jadwa said it expects Saudi Arabia’s gross domestic product to remain at 3.2 per cent this year down to 2.3 per cent in 2016.
($1 = AED3.67, at the time of publishing)