The Government of Saudi Arabia struggles to balance its budget as oil prices fall below $35 (USD) per barrel. The kingdom needs oil prices to reach $106 to fund current expenditures. The Saudi budget is predominately centered on oil prices; the BBC reports that oil revenue forms 73% of the state’s total revenue, while The Independent claims it is as much as 90%. The deceleration of the price of oil per barrel has led to the introduction of austerity policies in the kingdom.
These policies could cause unrest in the kingdom, writes Ben Chu, economics editor for The Independent. Chu argues that lower public expenditure could lead to problems with the nation’s youth, as economic hardships might catalyze political activism among young unemployed Saudi citizens. With more than half of the nation’s population being under 24, and one-third of that population being unemployed, The Independent’s writer also suggested that a failure to invest in welfare programs could result in future political unrest.
William Jay is an advocacy intern at ADHRB