Good news for Saudi Arabia, but hurdles remain.
After suffering from plunging global oil prices in 2015 and 2016, Saudi Arabia can take a much-deserved bow over its success, along with other OPEC and non-OPEC producers, in reigning in oil production by taking some 1.8 million bpd off the market and coming near its goal of oil inventory levels in OECD countries reaching near five-year averages.
However, the country is still running troubling budget deficits that began three years ago when global oil prices plunged from more than $100 per barrel in mid-January 2014 to below $30 per barrel in early 2016. Saudi Arabia’s 2015 budget deficit reached a record high $98 billion, equal to 15 percent of its GDP. The Kingdom’s budget deficit in 2017 was around $61 billion, a steady decline from $79 billion in 2016. For 2018, though the budget deficit was gradually being trimmed, it’s still expected to close the year at $52 billion...