Saudi Arabia's fiscal reserves dropped to a four-year low last year as the government sought to finance a budget deficit caused by plunging oil revenues, a report said Tuesday. The reserves of the world's largest crude exporter dropped to $611.9 billion at the end of 2015, the lowest level since 2011, down from $732 billion a year before, the Saudi Jadwa Investment said in an economic report.
Jadwa said it expected reserves to fall to around $500 billion by the end of 2016, after oil prices fell by three quarters since mid-2014. The kingdom, the second largest crude producer after Russia, posted a record budget deficit of $98 billion last year after oil income dived by 60 percent to just $118 billion. Riyadh also projected an $87 billion deficit for this year but Jadwa forecast the shortfall to be more than $107 billion. To help finance the budget deficit, the kingdom in December introduced a series of austerity measures raising fuel prices by up to 80 percent and increasing the prices of electricity, water, natural gas and others.