(Bloomberg) -- Saudi Arabia’s revenue from oil exports has slumped to the lowest in more than three years as sluggish demand growth weighs on crude prices.
Income from the sale of crude oil and refined products dropped to $17.4 billion in August, a 6% slide from the previous month, according to the state statistics agency. That’s the lowest level of monthly revenue since June 2021.
The Saudi economy is still largely dependent on oil income for growth, even more so now that the country has embarked on an ambitious plan to expand its technology, tourism and manufacturing industries. The massive investment required to realize Crown Prince Mohammed bin Salman’s plan to transform the economy relies on oil revenue to fund initiatives aimed at decreasing reliance on income from hydrocarbons.
That effort has been complicated by falling oil prices and lower production. Global benchmark Brent crude is down about 1% this year and is trading around $75 a barrel. Growth in oil consumption has been sluggish, particularly in China, one of the most important import markets, while new supply from countries like the US — now the world’s top producer — is outpacing demand growth and weighing on prices.
The Organization of Petroleum Exporting Countries and its allies have been restricting output to prop up the market. That’s limited the amount of crude that Saudi Arabia, the leader of the alliance, can sell. The wider OPEC+ group, which includes producers like Russia, is set to roll back some of those cuts in December, though it’s left the door open to keeping those limits in place if needed to avoid oversupply.
Oil is down 3% since the end of August.
--With assistance from Matthew Martin.
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