Saudi Arabia could go bankrupt within five years - IMF

[webfact]

Saudi Arabia Could Go Bankrupt Within Five Years - IMF

NEW YORK: -- Saudi Arabia, the world’s largest oil producer, will run out of cash reserves in five years or less if global oil prices stay at around $50, according to a report by the International Monetary Fund (IMF). The grim outlook also includes Oman and Bahrain.

Colonel Abdullah bin Sahyan, who commands the Saudi forces in Yemen's southern port city of Aden, looks as he stands at his base in Aden September 28, 2015

Currently, the kingdom has $654.5 billion in foreign reserves but the cash is dwindiling quickly.
According to the report, the region will lose an estimated $360 billion this year due to low oil prices.

Countries which rely on oil for their budget incomes are now seeing their budget surpluses turning into massive deficits as oil prices have tumbled by more than 50 percent, to $45 per barrel versus over $100 last year.

Read more: http://sputniknews.com/business/20151027/1029158901/saudi-arabia-cash-reserves.html

-- SPUTNIK 2015-10-27

[thaibeachlovers]

As one that worked for 4 years in the kingdom, I would be very happy to see them bankrupt, and going back to riding camels. I have no happy memories of the place, and like most that worked there, stayed only for the money.

However, the injunction on all Muslims that are able to visit Mecca during their lifetime is a huge money spinner, so I doubt they will go bankrupt.

They real reason, though not given, they are having financial problems, is that the royals, and there are thousands of them, suck much of the money for their extravagant lifestyles, and a lot is given to the religious sector to keep them pacified.

If I were to write about the lifestyle of the royals, I doubt that anyone not been there would believe me. I wouldn't believe it unless I'd been there!

[canopus1969]

Great news

[trogers]

Is this the reason for that 2 tonnes of illegal drugs?

[lee b]

Great news

Best I've heard all day !!

[max72]

But oil prices will peak up again to $100 or more within less than 5 years, perhaps just 1-2 years.

[godden]

they can eat sand for all i care or camel sh*t

[Daniel Boon]

But oil prices will peak up again to $100 or more within less than 5 years, perhaps just 1-2 years.

based on what ... wishful thinking?

[Baerboxer]

They also have substantial phosphate deposits, bauxite and gold.

They are developing manufacturing, education (some very large universities) and have substantial overseas investments.

In 5 years, the world could be as different as it was 5 years ago - and nobody can predict much, especially IMF given their track record.

[F4UCorsair]

Good time to be buying shares in companies involved in oil drilling. The price won't stay at $50 forever.

[sanuk711]

Saudi Arabia Could Go Bankrupt Within Five Years - IMF

Who would fund ISIS then.........................

[sirwilly]

Made My DAY.

[Wasima]

As one that worked for 4 years in the kingdom, I would be very happy to see them bankrupt, and going back to riding camels. I have no happy memories of the place, and like most that worked there, stayed only for the money.

However, the injunction on all Muslims that are able to visit Mecca during their lifetime is a huge money spinner, so I doubt they will go bankrupt.

They real reason, though not given, they are having financial problems, is that the royals, and there are thousands of them, suck much of the money for their extravagant lifestyles, and a lot is given to the religious sector to keep them pacified.

If I were to write about the lifestyle of the royals, I doubt that anyone not been there would believe me. I wouldn't believe it unless I'd been there!

QUOTE: However, the injunction on all Muslims that are able to visit Mecca during their lifetime is a huge money spinner, so I doubt they will go bankrupt.

I agree 100% with you where the pilgrims are concerned. I've been there in 2012 and 2013 and at the rate these Saudi's are building hotels for the pilgrims, it's plain to see that the reason for the pilgrimage has changed for the Saudi's. Soon there will be nothing for the pilgrims and visitors to see... just hotels and more hotels... and every year it gets worse.

Also agree with you about those royals...

[namatjira]

Be a breakdown in the Middle East that would be a disaster for the world,

Big time, we need the Saudis believe it or not...

[Merzik]

But oil prices will peak up again to $100 or more within less than 5 years, perhaps just 1-2 years.

Unfortunately I think you are right. The price of oil was manipulated and brought down primarily to harm the Russian economy but this will not go on forever. I would love to see the Saudis go broke but don't think it will happen.

[Credo]

If oil prices stay low and the Saudi's run into financial problems, then I would guess that so would much of the Arab world, so the Hajj would be a very different event. Not a lot of wealthy people spending money.

Many of the non-Arab Muslim countries are relatively poor.

[namatjira]

Worst possible nightmare, but before they go broke they will just stop production, remember this oil price was manipulated by them to take out the low cost frackers.....opec would normally slow production to maintain price but this time they did not, it was their decision, they had the cash reserves to ride it out, needed to get America back on the books.

It still is pretty much their ball game.

They will not go broke....

[mrfaroukh]

They can live on Grass hopper and lizard as they love it.

[dhream]

If it's too good to be true...

Maybe Russia or China will 'glass' them seeing as Uncle Sam prefers to fellate them.

We can but hope.

[Mosha]

Better cancel those German Mosque offers then.

[oztaurus]

Doesn't Saudi Arabia still own about 8% of US Debt?

If they were going bankrupt there is about 1.5 trillion they could call in - which of course America couldn't pay without printing more .... that kind of thing could bring down a president, and would actually have more effect on the world economy than the actual bankruptcy of Saudi.

[johndudorn]

and the price at the pump still hasn't gone down, at least in proportion to the barrel price.

Just paid $1.87 in Ohio for unleaded!

[deucebi]

10 years ago the oil price was $50 a barrel and the Saudi's were making a good profit. So why are they making a loss now?

[bazza40]

It's an oil war, people. Fracking of shale in the USA has changed America from an oil importer to an exporter.

The Saudi cost of production is less than $10 a barrel, and well depletion rates are low. The American cost of production is $40-$50 a barrel, and well depletion rates are high.

The Saudis are hoping to bankrupt American producers by overproduction, driving the price down to levels where US wells lose money. US wells are heavily indebted, so they are hoping the flow of fiat money at very low interest rates will continue.

Who will blink first? Good question. My money would be on the Saudis, not because I particularly like them, but because the only asset America has now is the acceptance of the greenback as the world reserve currency. There's only so much money a country can print before the rest of the world starts calling debt in.

[farangmick]

But oil prices will peak up again to $100 or more within less than 5 years, perhaps just 1-2 years.

Unfortunately I think you are right. The price of oil was manipulated and brought down primarily to harm the Russian economy but this will not go on forever. I would love to see the Saudis go broke but don't think it will happen.

I disagree, I believe the Saudis and other OPEC countries kept production levels up to try to destroy the US shale oil companies.

[Seastallion]

Where's Naam when you need a good opinion?

[silent]

just deserts there

[elgordo38]

Is this the reason for that 2 tonnes of illegal drugs?

Spoil sport the princes want to party(camel races) and they need a little extra kicker to stimulate them and their gal pals(harem). Not to worry they will claim diplomatic immunity and take off drugs and all. I was rather surprised that there was not a load of booze on the plane as well. Observing laws and paying taxes are only for us poor smucks. Ask Leona Helmsley when you meet in in heaven well maybe in Hades.

[elgordo38]

Good time to be buying shares in companies involved in oil drilling. The price won't stay at $50 forever.

Who needs oil? Elon Musk is developing metal oil. Another company is experimenting with producing fuel for .58 cents a gallon profit included.

[gandalf12]

Cant say I would feel sorry for them but it would leave the door open to IS for recruits if nothing else.

Saudi is not a nice place and its people are far from likable. If anyone feels otherwise I suggest they go there and see what a hole it is.