Saudi Arabia, OPEC’s de facto leader and the world’s largest oil exporter, has seen better days – much better days.
Its now infamous decision in November 2014 to abandon its role as swing producer and actually ramp up production as global oil supplies were increasing and prices were tanking has hurt itself as much or more than U.S. shale oil producers it wanted to drive out of the market.
In the ensuing two years since that decision, Saudi Arabia’s state coffers have taken a hit. Due to low oil prices, attributed to the supply glut, the kingdom – which derives as much as 92% of its revenue from oil sales - ran a historic budget deficit last year of $98 billion, with an estimated $87 billion forecasted for this year.
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WNU Editor: All good things always come to an end .... and for Saudi Arabia it looks like their dependency on the wealth that their oil industry has given to them is now coming to a crash. A prediction .... the Saudi citizenry are now going to be introduced to the concept of taxes, and from that I have confidence that they will then develop the concept of government accountability .... which for a monarchy not use to criticism is a concept that they are going to have trouble adopting.
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