Business | Oil & Gas
Gulf states to spend despite oil price fall
Gulf states will be able to maintain fiscal spending at current levels as oil remains above the break-even point for most governments, Fitch Ratings said.
- Bloomberg
- Published: 00:01 November 12, 2008
London: Gulf states will be able to maintain fiscal spending at current levels as oil remains above the break-even point for most governments, Fitch Ratings said.
Saudi Arabia's fiscal surplus would fall to zero at an oil price of $50 (Dh183.7) a barrel, Fitch said on Tuesday in an e-mailed report. Kuwait would break even at $42 and Abu Dhabi at $31. For Bahrain the budget would balance at $74 a barrel.
"Abu Dhabi, Saudi Arabia and Kuwait will avoid major cuts to spending plans in 2009, and will be content to run much lower surpluses" Fitch said in the report.
"Bahrain will have to cut spending to adjust to lower oil prices'' and the draft budget shows they "are prepared to do this."
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