(MENAFN- Khaleej Times) Plunging oil prices could mean the first budget cuts for major exporter Saudi Arabia since 2002 but they are not expected to be large enough to stop growth in the Arab world's biggest economy.
The government gets about 90 per cent of its revenue from oil exports and is believed to need an average oil price above $90 to balance its budget this year.
But the price of Brent crude fell to $67 a barrel this week from $115 in June and if current prices are sustained, the budget plan for next year, expected late this month, will produce a deficit for the first time since 2009.
"There is no way for Saudi authorities to announce a bigger budget in 2015 than what they announced for 2014," said John Sfakianakis, a former adviser to the Saudi finance ministry who is now regional director of asset manager Ashmore in Riyadh.
"Unavoidably they will have to scale down the budget. [But] I do not expect the budget to be hugely lower."
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