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Oil prices have fallen in recent weeks, fearing that the deficit will grow longer, affecting governments' budgets and forcing them to continue borrowing to meet their financing needs.
Saudi oil production hit a record high in November, as US President Donald Trump pressured the kingdom for it to refrain from cutting production, sources said on Monday. oil industry. At the meeting of the OPEC next week.
According to Reuters, crude oil production in Saudi Arabia is estimated to be between 11.1 million and 11.3 million barrels per day in November, and these levels rise by about 500,000 barrels a day compared to October, and over a million barrels a day. Since the level of production in early 2018, when Riyadh has reduced its production with other members of OPEC.
A report published by Capital Economics in London last week showed that the decline in Brent crude, from $ 85 a barrel in early October to less than $ 65, has canceled $ 130 billion in Gulf revenue on an annualized basis. which equates to 9%. GDP.
However, the price level after this report indicates that the Gulf has lost more than its revenues after prices have dropped to around $ 60 a barrel, according to Monday's trading.
According to a report published by the Petroleum Economist site, the British oil specialist, the recent decline in oil prices "should continue further".
Saudi Arabia appears to be the biggest loser in terms of falling prices, as the world's largest exporter in the Gulf, and oil revenues account for more than 60% of the Saudi budget.
Saudi Arabia's budget for the years 2010 to 2013 recorded cash surpluses ranging from 88 billion ryals (23.4 billion dollars) to 374 billion ryals (99.7 billion dollars), which were then turned into deficits.
The kingdom recorded the largest deficit of the last 10 years in 2015, with about 366 billion rials ($ 97.6 billion), due to the 51% drop in oil revenues, a deficit recorded for the second year after reaching about 66 billion riyals in 2014 ($ 17.6 billion).
The Ministry of Finance estimated the deficit at the end of 2018 to 195 billion riyals (52 billion dollars) and 128 billion riyals. ($ 34.1 billion) in 2019.
According to current oil prices, Saudi Arabia's budget deficit will exceed government estimates for this year and next year, as the country needs 70 dollars a barrel to reach equilibrium budget, according to data published by the International Monetary Fund earlier this year.
The financial losses of Bahrain should be even more serious: the financial data indicate that it takes him 95.2 dollars a barrel of oil to reach a budget equal to that of this year, Oman to 76.3 dollars a barrel and the United Arab Emirates at 61.7 dollars a barrel.
In addition, Qatar and Kuwait will generate a surplus to exit the budget deficit, the equivalent of $ 47.2 per barrel for the price demanded in Qatar, while Kuwait would need $ 47.1 per barrel.
Finance Minister Ali Shareef Al Emadi revealed last October that Qatar had posted a budget surplus for the first nine months of 2018 for the first time in two years, with a surplus in 2019 next year.
Qatar had a deficit of 28.1 billion riyals ($ 7.6 billion) in the 2018 budget, down 1.1% from the 2017 deficit. However, data from the Qatar Central Bank has recently shown that the country had a surplus of $ 1.9 billion in the first half. This year.
In Kuwait, the budget recorded a deficit of $ 15.2 billion in fiscal years 2015/2016 and 2016/2017. For the fiscal year 2017/2018, the deficit amounted to $ 10.5 billion and began to release a surplus of $ 7.2 billion during the first half of the current fiscal year 2018/2019. Dollars The fiscal year begins in Kuwait each April.
"The budgets of most Gulf countries are threatened with a return to deficit after their recovery," said Ahmed Al-Mukhaizeem, a strategist at the Gulf Institute of Financial Analysts. But the drop in oil prices at the lowest level of the year will meet these expectations. "
The deficit in Bahrain rose from 455.1 million dinars ($ 1.2 billion) in 2014 to 1.51 billion dinars in 2015, to 1.63 billion dinars in 2016, to 1.3 billion dinars in 2017 and about 1.2 billion dinars estimated for 2018, according to the Council of Ministers.
The budget deficit prevents the Gulf countries from continuing to borrow. According to a report released by the international rating agency Standard & Poor's earlier this month, the Gulf countries must raise about $ 300 billion between 2018 and 2021, the largest funding requirements relate to Saudi Arabia.
Saudi Arabia has become the world's leading source of international debt, borrowing $ 52 billion in conventional and Islamic bond issues since entering global markets for the first time in late 2016.
On average, S & P plans to raise 70% of the $ 300 billion needed by the Gulf countries through debt and the remaining 30% of their assets.
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