REPUBLIKA.CO.ID, RIYADH -- Saudi Arabia was raising domestic gasoline prices by more than 50 percent from Tuesday (29/12) in response to its budget deficit of almost 98 billion US dollars. Prices would also increase on water, electricity, diesel and kerosene, as a number of subsidies are to be cut over five years, the official SPA news agency reported.
High-grade gasoline would increase by 50 percent to 0.90 riyals (0.24 US dollars) per liter, and lower-grade gasoline would see a 67 percent increase. Aramco, the country’s state-owned oil company, announced on Twitter that it would close gasoline stations until midnight on Monday (28/12).
The gasoline prices in the kingdom have been the cheapest in the Gulf and one of the cheapest in the world. Other Gulf stated to have raised fuel prices, with United Arab Emirates and Kuwait lifting subsidies earlier this year.
The IMF has said that if Saudi Arabia raised its fuel prices to Gulf levels, it would save around 17 US dollars billion annually. The global falling oil prices and increased Saudi spending have contributed to the Kingdom’s deficit
On Monday (28/12), Saudi Finance Ministry released 2016 budget and reported that its budget deficit swelled considerably in 2015, to 367 billion riyals (97.9 billion US dollars) or 15 percent of gross domestic product. Saudi Arabia expects to have a deficit of almost 87 US dollars billion for 2016.
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