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News & General Discussion => News Stories and Current Events => Topic started by: josephpalazzo on October 26, 2015, 08:24:44 AM

Title: Saudi Arabia to run out of cash in less than 5 years
Post by: josephpalazzo on October 26, 2015, 08:24:44 AM
http://money.cnn.com/2015/10/25/investing/oil-prices-saudi-arabia-cash-opec-middle-east/index.html?sr=twcnnbrk102515oilpricessaudiarabiacashopecmiddleeast512pStoryMoneyPhoto


QuoteIf oil stays around $50 a barrel, most countries in the region will run out of cash in five years or less, warned a dire report from the International Monetary Fund this week. That includes OPEC leader Saudi Arabia as well as Oman and Bahrain.


...


Saudi Arabia, the world's largest oil producer, needs to sell oil at around $106 to balance its budget, according to IMF estimates. The kingdom barely has enough fiscal buffers to survive five years of $50 oil, the IMF said.
That's why Saudi Arabia is moving fast to preserve cash. The kingdom not only raised $4 billion by selling bonds earlier this yea (http://money.cnn.com/2015/08/06/news/economy/saudi-arabia-oil-deficit/?iid=EL)r, but its central bank has yanked up to $70 billion (http://money.cnn.com/2015/09/30/investing/saudi-arabia-oil-cash-crunch/?iid=EL) from asset management firms like BlackRock (BLK (http://money.cnn.com/quote/quote.html?symb=BLK&source=story_quote_link)) over the past six months.
After years of huge surpluses, Saudi Arabia's current account deficit is projected to soar to 20% of gross domestic product this year, Capital Economics estimates. Saudi Arabia's war chest of cash is still humungous at nearly $700 billion, but it's shrinking fast.




Allah is great.
Title: Re: Saudi Arabia to run out of cash in less than 5 years
Post by: Sal1981 on October 26, 2015, 09:45:34 AM
Good. They can start by cutting on military spending to break even.
Title: Re: Saudi Arabia to run out of cash in less than 5 years
Post by: The Skeletal Atheist on October 26, 2015, 12:22:30 PM
So that's what happens when you stake most of your economy on a single product.

(https://s-media-cache-ak0.pinimg.com/736x/0e/6c/12/0e6c12e42465076d0afce605098fc4aa.jpg)
Title: Re: Saudi Arabia to run out of cash in less than 5 years
Post by: Baruch on October 26, 2015, 12:41:43 PM
They are running out of money fighting a two front war.  Against the Russian/Iranian/Iraqi petroleum producers ... and against Yemen.  They should have paid attention to German history.