Saudi’s oil price gamble exposes fragile finances

Saudi’s oil price gamble exposes fragile finances

**Written and disseminated to select contacts on March 25, 2020**

Saudi Arabia’s finances risk becoming seriously impaired if oil prices remain lower for longer, with the state budget and balance of payments deficits virtually unfinanceable at $30/b in 2020. The massive cuts to spending needed could lead to political and public discontent, especially at a time when progress on Vision 2030 goals is slow and unlikely to deliver on its economic objectives in the ambitious time frame.  

Rachna Uppal | Senior Analyst Business & Finance | r.uppal@castlereagh.net

Managing COVID-19: China, OPEC and the energy markets

Managing COVID-19: China, OPEC and the energy markets

The coronavirus epidemic has put Asian oil and gas demand growth back in the spotlight – this time as a spoiler not the savior it has been in the last three decades.  That period had its scares – the Asian financial crisis of 1997-98 and the global financial crisis of 2008-09 – but Asian demand could generally be relied upon to buoy growth and bounce back quickly after crises. In the wake of COVID-19, forecasts of an economic rebound in China by mid-year may be correct, but certain structural factors could alter the longer-term trajectory of demand growth. For OPEC and the oil markets, the conditions make for an uncertain 2020.