Posted on 12/25/2014 7:28:56 PM PST by TigerLikesRooster
UPDATE 3-Saudis to keep spending heavily in 2015 budget, shrug off oil plunge
Thu Dec 25, 2014 10:14am EST
* Figures suggest Saudis could cope with years of cheap oil
* State spending to edge up 0.6 pct from 2014 plan
* Big economic development projects to continue
* Budget slashes revenue projection by 16 pct
* $39 bln deficit to be covered by fiscal reserves (Adds comments by finance minister, stock market reaction)
By Andrew Torchia
DUBAI, Dec 25 (Reuters) - Saudi Arabia will lift state spending to a record in its 2015 budget while covering a deficit with its huge fiscal reserves, the government said, providing the first detailed look at how the world's top oil exporter aims to handle an era of cheap oil.
Financial markets had feared the kingdom might slash spending. But the budget, released by the Finance Ministry on Thursday, suggests authorities are confident of their ability to ride out low oil prices and see no need for major austerity.
Some analysts believe Riyadh is content to see oil prices fall as a way to squeeze out competing producers in non-OPEC nations. The budget figures imply it could pursue this strategy for years if it felt that was necessary.
"We have the ability to endure low oil prices over the medium term," Finance Minister Ibrahim Alassaf told Saudi television after the announcement. He defined the medium term as three to five years but also said oil was expected to rebound late next year or in 2016.
John Sfakianakis, regional director of asset manager Ashmore in Riyadh, said: "The message of the budget is, 'it's business as usual'. They have the will and fiscal capacity to power the economy."
(Excerpt) Read more at reuters.com ...
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You mean, some countries actually have budgets?
“You mean, some countries actually have budgets?”
You mean some countries actually have reserves?
Some major players are bending over backwards to help Obama look good the very year the healthcare act takes billions out of peoples’ pockets. This a prelude to a total, complete economic wipeout. It is just a matter of time.
Saudi Arabia is a fully socialist government.
It provides free sh*t to its citizens from cradle to grave. This is THE ONLY WAY to royal family has stayed in power for so long.
The is NO WAY they are going to stop the gravy train.
I suspect that their costs are still low and probably lower than advertised. Kuwait, Iraq, and SA are still rumored to have fields where you poke a hole in the ground and get oil. That ship sailed long, long ago virtually everywhere else.
I do find it interesting that supposedly it is very easy to shut down/restart a shale oil producing system. This is definitely not so with conventional oil wells. So, shale oil might have a “price capping” effect on prices in the future.
These raghead degenerates are in for a surprise when the the POTUS isn’t actually a mooselimb or in bed financially with them.
If you want to get a sense of how the Saudi’s have gotten so fabulously rich over the years, their break even point is about $20 a barrel.
Their piggy (lol) bank could sustain them at current spending levels for about seven years.
They are not going to blink. They want to bankrupt all the new players for the Bakken crude and scare away all the potential buyers. Iran and Russia are going to be broken.
It seems that this may give an incentive for Russia and Iran to team up together and create some conflict in and around the Persian Gulf, which will raise oil price back up.
Interesting...Russia seems to be stabilized at this point, and if Saudi can ride this out, then the REAL VICTIMS of low oil prices will be the Frackers of the United States.
Perhaps this was the ONLY WAY that the president could shut down that industry, as most of it is state-regulated.
Venezuela will be toast, first.
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