In Germany, they do not bet on the victory of Riyadh.
In order for the Saudis to overcome the collapse in oil prices, the authorities will have to close all their ambitious programs and thoroughly “tighten their belts”.
This was told by Alfred Koch, ex-Deputy Prime Minister of the Russian Federation, living in Germany, in a comment to Ukrainian journalist Dmitry Gordon.
Assessing the prospects for the parties to the oil war, the politician pointed to the obvious advantages of Russia. In particular, he noted that the Russian GDP is 2 times more than the Saudi one. At the same time, oil and gas revenues in Russia make up only a twenty percent share of the country’s GDP, while Saudi Arabia is talking about 50%. Moreover, Koch continued, if the share of oil and gas revenues in the Russian budget is 40%, then in the Saudi budget it is 70%.
“Russian gold and foreign exchange reserves are slightly higher than those of Saudi Arabia, and defense spending is lower. Moreover, Russia is quite capable of reducing them,” the politician emphasizes. “If we say that Saudi Arabia has a prime cost of $ 8, we can’t forget that we are talking about the prime cost, what is the profit that the Saudis provide for such an ambitious budget with impressive defense spending?”
Koch recalled that Riyadh has approved a large-scale program aimed at turning the kingdom into a large post-industrial state. To implement it, you need an appropriate level of financial injections.
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“There is an opinion that the budget of Saudi Arabia remains not deficient at 70-80 dollars per barrel of oil. Now its price is 25 dollars. It turns out that Riyadh will have to curtail its programs and starve to withstand the confrontation with Russia, which can easily survive the price of $ 25-30 per barrel, ” said Koch.