Skip to main content
IRAN Energy News Agency
Oil, Gas, Petrochemical and Energy Field Specialized Channel
Oil, Gas, Petrochemical and Energy Field Specialized Channel
Oil, Gas, Petrochemical and Energy Field Specialized Channel

Saudi Arabia Needs Oil to Trade at US$70 a Barrel in 2018 to Break Even

Oil will trade at $50 to $60 a barrel for the “medium term,” the IMF said.

Saudi Arabia, OPEC’s biggest oil producer, is also the leader when it comes to slashing the crude price the country needs to balance its budget.

The kingdom will need oil to trade at $70 a barrel next year to break even, the Washington-based International Monetary Fund said Tuesday in its Regional Economic Outlook for the Middle East and Central Asia. 

That’s down from a break-even of $96.60 a barrel in 2016, the biggest drop of eight crude producers in the Persian Gulf. 

The break-even is a measure of the crude price needed to meet spending plans and balance the budget.

Gulf oil producers are cutting spending and eliminating subsidies after crude plunged from more than $100 a barrel in 2014 to average just over half that this year. 

The need to curb spending is more urgent with the Organization of Petroleum Exporting Countries cutting output to reduce a global glut. 

Oil will trade at $50 to $60 a barrel for the “medium term,” the IMF said.

“The reality of lower oil prices has made it more urgent for oil exporters to move away from a focus on redistributing oil receipts through public sector spending and energy subsidies,” the IMF said.

Iran, Iraq, Kuwait and Qatar will have break-evens below the oil price, more than enough to balance the budget in 2018, according to IMF estimates and forward Brent price data compiled by Bloomberg. 

Countries like Saudi Arabia will take longer to balance their budget, the IMF said.

None of the producers have yet created economies that will support their population “once hydrocarbon resources are exhausted,” the IMF said.

Join us on Telegram Channel."Energy Today"

Add new comment

CAPTCHA
This question is for testing whether you are a human visitor and to prevent automated spam submissions.
Fill in the blank.
Parvin Faghfouri Azar
Energy Today
w
+98.21.26413997
Unit 32, No. 26, North Naft Street
Tehran,TH,1918793572
Iran

Saudi Arabia Needs Oil to Trade at US$70 a Barrel in 2018 to Break Even

Oil will trade at $50 to $60 a barrel for the “medium term,” the IMF said.
Parvin Faghfouri Azar
Saudi Arabia, OPEC’s biggest oil producer, is also the leader when it comes to slashing the crude price the country needs to balance its budget. The kingdom will need oil to trade at $70 a barrel next year to break even, the Washington-based International Monetary Fund said Tuesday in its Regional Economic Outlook for the Middle East and Central Asia.  That’s down from a break-even of $96.60 a barrel in 2016, the biggest drop of eight crude producers in the Persian Gulf.  The break-even is a measure of the crude price needed to meet spending plans and balance the budget.Gulf oil producers are cutting spending and eliminating subsidies after crude plunged from more than $100 a barrel in 2014 to average just over half that this year.  The need to curb spending is more urgent with the Organization of Petroleum Exporting Countries cutting output to reduce a global glut.  Oil will trade at $50 to $60 a barrel for the “medium term,” the IMF said. “The reality of lower oil prices has made it more urgent for oil exporters to move away from a focus on redistributing oil receipts through public sector spending and energy subsidies,” the IMF said. Iran, Iraq, Kuwait and Qatar will have break-evens below the oil price, more than enough to balance the budget in 2018, according to IMF estimates and forward Brent price data compiled by Bloomberg.  Countries like Saudi Arabia will take longer to balance their budget, the IMF said. None of the producers have yet created economies that will support their population “once hydrocarbon resources are exhausted,” the IMF said.
49