Saudi Arabia's decision to cut oil production could potentially have a significant impact on its GDP, given that approximately 80% of the country's revenue comes from oil exports. This reduction in oil production may lead to a budget deficit by the H2 '23.
One logical reason behind this production cut is the potential for higher oil prices, driven by supply constraints. The United States, with its Strategic Petroleum Reserve (SPR) at historically low levels (around -60% of its reserve capacity), may be forced to buy that expensive oil. This could be financially advantageous for Saudi Arabia, as it could sell its oil at higher prices in a tight global market.
I confidently see oil above $100
One logical reason behind this production cut is the potential for higher oil prices, driven by supply constraints. The United States, with its Strategic Petroleum Reserve (SPR) at historically low levels (around -60% of its reserve capacity), may be forced to buy that expensive oil. This could be financially advantageous for Saudi Arabia, as it could sell its oil at higher prices in a tight global market.
I confidently see oil above $100