Concerns that the global economy may fall into recession again have increased the likelihood of a drop in the oil price, which in turn poses some downside risks to Saudi Arabia’s economy. Indeed, a change in Brent crude prices could have an impact on the country’s GDP, especially if the additional public spending programmes (that were announced earlier in the year) are scaled back. However, we think that the oil price needs to fall below $70 before the government’s expenditure plans are re-considered.
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