2 weeks later and almost 4 million bpd of overall assured extra oil supply to the market next month, and Riyadh and Moscow are now counting the expense and attempting to adjust government spending.
Even before the collapse of the OPEC talks, Saudi Arabia’s financing ministry had asked government companies to propose a 20-30 percent cut in their spending plans due to the oil cost slide, Reuters reported last week, pointing out four sources with knowledge of the plans.
” For countries in the Gulf Cooperation Council (GCC), we approximate that a modification of USD10 in the cost per barrel of oil tends to impact government incomes by 2%-4%of GDP,” Fitch said last week.
At $30 a Brent barrel, the Saudi wealth fund will deplete fast and minimized government spending will stall jobs, and the currently suffering personal non-oil sector will suffer even more.
By Tsvetana Paraskova for Oilprice.com
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source https://jobsearchtips.net/saudi-arabias-oil-cost-war-is-backfiring/
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