Saudi Budget Deficit Shrinks as Revenues Surge

Saudi Arabia's budget deficit dropped sharply in the first nine months of 2018 on the back of a surge in oil and other revenues, the finance ministry said on Wednesday.

The OPEC kingpin, which has introduced economic reforms aimed at reducing its dependence on oil, has benefited from a sharp rebound in energy prices on world markets.

The budget shortfall in the first three quarters of 2018 was $13.1 billion, a 60-percent drop from the same period last year, the ministry said on its website.

Oil revenues rose 47 percent year-on-year to $120.6 billion while non-oil income jumped 48 percent to $56.3 billion, it said.

The kingdom, the world's top crude oil exporter, has posted a budget deficit every year since oil prices crashed in 2014.

In the past four fiscal years, it posted a total shortfall of around $260 billion and has projected a deficit of $52 billion for 2018.

The ministry said that expenditure in the first nine months of 2018 rose by 25 percent to $190 billion.

The rise in non-oil income is significant after Riyadh has increased the prices of fuels and power and imposed a five-percent value-added tax (VAT) in addition to fees on around 11 million expatriates in the country.

Saudi Arabia has also increased its oil production by over 500,000 barrels per day to more than 10.5 million barrels daily since June and the price of oil has surged to over $80 a barrel.