Jadwa Investment’s recently-released report on the Saudi economy highlights the strong economic situation the Kingdom is in through the start of 2022, as higher oil prices and a growing non-oil sector continue to power growth in the Arab world’s largest economy.
Saudi government revenue totaled SR278 billion ($74.12 billion) in Q1 2022, up 36 percent, or SR73 billion ($19.46 billion), year-on-year.
Government revenue totaled SR278 billion in Q1 2022.
A rapid rise in global oil prices during the quarter led to oil revenue jumping 58 percent on a yearly basis. Brent oil prices rose 69 percent year-on-year in Q1 2022 (to an average of $103 per barrel), and this rise was reflected in substantially higher transfer of royalties and income tax to the Ministry of Finance, according to Jadwa.
Looking ahead, with oil prices remain elevated, and Saudi crude oil production rises in-line with the OPEC plus agreement, “we expect government oil revenue to continue showing sizable yearly rises. More specifically, we see government oil revenue totaling SR935 billion, up 66 percent over last year’s total,” Jadwa said.
But Jadwa noted that while non-oil revenue rose 7% year-on-year during the same period, the Riyadh-based bank’s current forecast assumes full year 2022 non-oil revenue, as a whole, to decline by 9 percent year-on-year, primarily because of lower yearly taxes on goods and services.
Despite higher oil prices and soaring revenues, the Kingdom maintained a responsible fiscal posture, with expenditures rising 4 percent higher year-on-year in Q1 2022.
