Saudi Arabia’s oil exports rebounded in June from a five-month low as the largest OPEC producer boosted output to a record, Bloomberg reports. Exports climbed to 7.37 million barrels a day from 6.94 million barrels in May, according to JODI data.
Saudi Arabia told OPEC its June production was a record, exceeding a previous all-time high set in 1980, according to Bloomberg.
The IMF says the steep fall in oil prices is likely to dampen growth in Saudi Arabia.
Meanwhile, the IMF called on Saudi Arabia to undertake a host of fiscal changes and make greater gains toward diversifying the Kingdom’s economy away from its reliance on oil to boost growth and create jobs.
According to MarketWatch, the IMF urged Saudi Arabia to undertake a “sizable multiyear fiscal adjustment” by taking such measures as revising energy subsidies, controlling public sector wages, and expanding revenues not stemming from oil, while also proposing a value-added tax, or VAT, and a land tax.”
Although the economic reliance on oil revenues is risky in the long term, there is time to adjust, and non-oil growth is encouraging, Saudi economy expert John Sfakianakis told Arab News.
“The economy is on a slower growth path on the oil side yet the nonoil economy is still at a positive path. The economy is still well cushioned due to high reserves and the bond issuing program is well received and prudent,” Sfakianakis said. “Fiscal discipline would have to be applied and revenue generating alternatives would have to be devised as well as a reviewing energy subsidies especially targeted energy subsidies.”
