Middle East economies take massive hit with oil price crash

Middle East economies take massive hit with oil price crash

BAGHDAD (AP) - Iraq is planning painful cuts in social benefits relied on by millions of government workers.. The historic crash in oil prices in the wake of the coronavirus pandemic is reverberating across the Middle East as crude-dependent countries scramble to offset losses from a key source of state revenue - and all this at a time when several of them already face explosive social unrest.. The economies of all the Arab Gulf oil exporters are expected to contract this year, as much as five percent in Iraq, according to the International Monetary Fund.. While some Gulf countries can rely on a cushion of foreign currency reserves, nowhere in the region are the circumstances more dire than in Iraq, where oil sales fund 90 percent of the state budget.. Oil is currently trading at US$20 per barrel, dipping even lower some days to levels not seen since 2001.. The region's largest crude producer, Saudi Arabia, plans to cuts spending by 5 percent, or about $13.3 billion.. The double shock of the pandemic and dropping oil prices is also expected to hit hard in Egypt, Jordan and Lebanon, which rely on a large diaspora and workers in oil-rich Arab Gulf