Saudi fiscal reforms likely to bring oil break-even price below $55 per barrel by 2021 - The National

Saudi fiscal reforms likely to bring oil break-even price below $55 per barrel by 2021 - The National:

"Saudi Arabia, the world’s biggest oil exporter, is likely to lower its budget break-even oil price to below $55 per barrel by 2021 as the biggest Arab economy continues to implement economic and fiscal reforms, according to a new report. After slashing nominal government expenditures by a fifth, cutting subsidies, introducing new taxes and raising non-oil revenues, the kingdom has lowered its break-even oil price to $74.4 per barrel in 2018, down 29 per cent from $105.7 in 2014, Japanese lender MUFG Bank said in a report released on Wednesday. In 2019, break-even oil prices are likely to remain at $69.3 per barrel as the kingdom shifts its strategy of deficit reduction and austerity to focusing on economic stimulus, it noted. “All in all, a direct consequence of fiscal and economic reform is that Saudi Arabia will be in a stronger position over the medium term …. with greater independence from the oil price,” Ehsan Khoman, the head of research for the Middle East and North America said in The Mena Focus Report."



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