Saudi Arabia earns $2.5 billion per year from every dollar rise of oil prices

Saudi Arabia’s public spending is projected to rise by SR8 billion (some $2 billion) per year during the next five years, an economic report by the National Commercial Bank said. 

According to Arab News, the report indicated progress in the kingdom’s economic situation this year on the back of mounting oil prices.  

Average Saudi oil export prices are expected to reach $33 per barrel during this year, posting a 22.2 percent increase compared to prices in 2003, the report said. 

The current oil prices are $14 higher than the prices estimated for the 2004 fiscal budget. “An addition of every dollar to oil prices will help the Kingdom earn $2.5 billion annually,” the NCB report said.  

Oil revenues account for some 75% of Saudi Arabia’s total revenues and this revenue will continue to go up in the remaining period of the year. 

The bank predicted that total government spending this year would stand at SR265 billion, including the spending on security, defense and ongoing fight against terror. 

The Kingdom’s non-oil sector is expected to grow by 4.7 percent this year compared to 1.9 percent in 2003. The public sector is to achieve a growth rate of 3 percent and the private sector 6.1 percent. 

However, the report pointed out that the private sector’s contribution to the GDP would go down from 40 percent to 36.3 percent this year. (albawaba.com)