According to budget figures released by the Saudi Ministry of Finance on Tuesday, the country’s deficit widened to 125.7 billion riyals ($33.5 billion) during the first quarter of the year.
Saudi Arabia has reported a sharp increase in its budget deficit as falling oil revenues, linked to the effective closure of the Strait of Hormuz, put pressure on the kingdom’s finances.
According to budget figures released by the Saudi Ministry of Finance on Tuesday, the country’s deficit widened to 125.7 billion riyals ($33.5 billion) during the first quarter of the year.
The rise came as government spending increased while income from crude oil sales declined.
Total government expenditure climbed by 20 percent year-on-year to 386.7 billion riyals, while oil revenues dropped by 3 percent to 144.7 billion riyals.
The budget shortfall was more than twice the deficit recorded during the same period last year and nearly one-third higher than the figure reported in the final quarter of 2025.
The latest figures represent a major setback to Saudi Arabia’s earlier financial projections.
In December, officials had forecast a total budget deficit of 65 billion riyals ($17 billion) for the whole of 2026.
Sector-by-sector data showed that spending on economic resources recorded the largest increase, rising by 52 percent compared to last year.
Expenditure on general items rose by 46 percent, while defence and infrastructure spending each increased by 26 percent.
Non-oil revenues grew slightly by 2 percent, helping to partly offset the decline in oil income.
As the world’s leading oil exporter, Saudi Arabia has been heavily affected by disruptions to shipping through the Strait of Hormuz, a critical route for global energy supplies.
However, the kingdom has managed to redirect much of its oil exports through the Red Sea port of Yanbu using the East-West Pipeline.
Oil and petroleum product sales remain the backbone of Saudi Arabia’s economy, accounting for more than half of government revenues and generating 606.5 billion riyals for the state in 2025.
Join us on our WhatsApp Platform @KOIKIMEDIA NEWS YOUR PAGE
koikimedia Bringing the World 🌎 Closer to Your Doorstep