Sunday 23 October 2016

Saudis pull home $70bn as oil price bites

Stefania Bianchi

Published 29/09/2015 | 02:30

Nigel Sillitoe is CEO of Dubai based Insight Discovery
Nigel Sillitoe is CEO of Dubai based Insight Discovery

Saudi Arabia has withdrawn as much as $70bn (€62.5bn) from global asset managers as OPEC's largest oil producer seeks to plug its budget deficit after crude slumped, according to financial services market intelligence company Insight Discovery.

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"Fund managers we've spoken to estimate SAMA has pulled out between $50bn to $70bn from global asset managers over the past six months," Nigel Sillitoe, chief executive officer of the Dubai-based firm, said yesterday.

"Saudi Arabia is withdrawing funds because it's trying to cut its widening deficit and it's financing the war in Yemen," he said, declining to name the fund managers.

Saudi Arabia is seeking to stem a decline in its finances after a 50pc drop in oil during the past 12 months. The Saudi Arabian Monetary Authority's reserves held in foreign securities have fallen about 10pc from a peak of $737bn last August to $661bn in July, according to data from the central bank.

Income from oil accounts for about 90pc of revenue and Saudi Arabia's budget deficit may widen to 20pc of gross domestic product this year, according to the International Monetary Fund. (Bloomberg)

Irish Independent

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