| RSS
Business center
Office
Post trade leads
Post
Rank promotion
Ranking
 
You are at: Home » News » internal »

Saudi 2017 budget projects 46% rise in oil revenues, no details on fuel price hikes

Increase font size  Decrease font size Date:2016-12-26   Views:411
Saudi Arabia expects to earn 46% more from oil revenues in 2017 compared to this year, with expectations of rising global demand combining with the OPEC-led global production cut to push prices higher.

In its annual budget unveiled Thursday, the kingdom said its oil revenues were projected to hit Riyals 480 billion ($128 billion) next year, up from Riyals 328 billion ($88 billion).

The budget did not reveal any details about Saudi Arabia's oil production plans or targets, nor does it say what price it expects to receive for its oil, though it cited the International Monetary Fund's estimate of 2017 oil prices at $50.60/b. Oil prices in 2016 averaged $43/b, the budget document said.

Overall revenues for 2017, including non-oil revenues, are expected to rise 31% from 2016 levels to Riyals 692 billion.

With the budget laying out an expenditure plan for Riyals 890 billion ($237 billion), an 8% increase over this year, this means the kingdom will be facing a deficit of 198 billion riyals ($53 billion), down 33% from this year, as Saudi Arabia has had to tap into its reserves to withstand the low oil price environment of the last two years.

"The 2017 budget was prepared in light of developments in the local and global economy, including the estimated price of oil," the budget document states, attributing the increases in projected revenues and expenditures to energy pricing reforms.

"As the kingdom's economy is strongly connected to oil, the decrease in oil prices over the past two years has led to a significant deficit in the government's budget and has impacted the kingdom's credit rating."

Total national debt for 2016 was about Riyals 316.5 billion ($84 billion), or 12.3% of projected GDP.

FUEL PRICE HIKES UNMENTIONED

But widely expected increases in fuel prices were not outlined in the budget.

Reports had indicated that Saudi Arabia would announce fuel price hikes of 40% in the budget and a 20% rise in electricity tariffs, which would have been the second increase after the kingdom made a dramatic change in policy last year.

In its 2016 budget, it increased long-standing prices for gasoline and domestic gas for power generation as well as ethane feedstock as part of a broader program to cut subsidies and reduce the budget deficit.

The price of 95 RON gasoline was raised 50% to Riyals 0.9/liter (24 cents/liter), while that of 91 RON gasoline was raised two-thirds to Riyals 0.75/liter. Gas prices were increased to $1.25/MMBtu from 75 cents/MMBtu, and ethane, the main feedstock for petrochemicals, to $1.75/MMBtu, more than double the long-standing fixed price of 75 cents/MMBtu.

These were all part of a gradual five-year program aimed at structural economic reform, including fuel price hikes, to improve energy efficiency and bring spending under control.

The 2017 budget document made reference to the reform efforts, saying that the government would review and evaluate all subsidies, "including adjustments for petrol products, water and electricity support systems, and repricing over the next five years to achieve efficient use of energy, preserve natural resources, avoid irrational use, in addition to increasing fairness by focusing government support on the middle or low income citizens and establishing a competitive business sector."
 
 
[ Search ]  [ ]  [ Email ]  [ Print ]  [ Close ]  [ Top ]

 
Total:0comment(s) [View All]  Related comment

 
Recomment
Popular
 
 
Home | About | Service | copyright | agreement | contact | about | SiteMap | Links | GuestBook | Ads service | 京ICP 68975478-1
Tel:+86-10-68645975           Fax:+86-10-68645973
E-mail:yaoshang68@163.com     QQ:1483838028