Saudi Arabia may face budget squeeze after 2021, Moody’s says

Saudi Arabia may face budget squeeze after 2021, Moody’s says

Saudi Arabia may not be able to rely on annual dividends of almost $75bn from state oil company Saudi Aramco beyond next year unless crude prices increase, according to Moody's Investors Service.

The government, which owns 98 per cent of Aramco, has depended on the dividend to help plug its budget deficit.

"The government is unlikely to be able to repeat the maneuver beyond 2021,“ Moody's said in a report.

This is the case "particularly when taking into account Saudi Aramco's own capital expenditure needs and its commitment“ to buying Saudi Basic Industries Corp (SABIC).

Aramco agreed earlier this year to buy 70 per cent of the chemicals maker from the government's Public Investment Fund for $69bn.

Aramco pledged during its 2019 initial public offering to pay out $75bn to shareholders during its first