Thematic

An examination of the latest developments in the Saudi economy and stock market, and the global oil market.

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    Tue, 25 October 2016

    Natural Gas and the Vision 2030

    Historically, the pace of growth in Saudi gas demand has kept up with gas output. Looking ahead, gas demand is not likely to slow as total electricity consumption is pushed up by industrial development, in line with the Vision 2030, and rising population levels. Accordingly, Jadwa Investment forecasts that Saudi Arabia will need to grow gas output by an annual average rate of either 3.7 percent, in the base case scenario, or 6.6 percent, in the high case scenario, in the decade to 2030.

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    Mon, 26 September 2016

    International Trade and Investment Outlook

    Structural reforms announced in both the Vision 2030 and the National Transformation Program (NTP 2020) will have major implications on the Kingdom’s trade and financial flows, with a dramatic shift in the balance of payments over the next fifteen years. This report highlights how the implementation of reforms stipulated in both programs will move the economy away from oil, whilst, simultaneously, contributing to a competitive and productive private sector, which will attract foreign capital and contribute to further knowledge exchange, investment, and employment.

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    Thu, 16 June 2016

    National Transformation Program (NTP) 2020: The Kingdom's Path to Sustainable Economic Development

    The Council of Ministers approved the Kingdom’s National Transformation Program (NTP 2020) on June 6th 2016, with it ushering in a major new policy era designed to overhaul the economy. The program branches out directly from the Vision 2030 announcement back in April, and includes major overhauls to the economy. In this report, we attempt to assess the most relevant economic initiatives specified within the NTP, and try to present the likely trends and potential impact on the economy. We have also revised some of our macroeconomic forecast for 2016 and 2017, including our oil, fiscal, external, and GDP outlook.

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    Thu, 05 May 2016

    Saudi Vision 2030: Placing the Kingdom on a prosperous path

    The Council of Ministers recently approved a major and ambitious new Vision for the Kingdom. In this report, we attempt to illustrate the main economic reasons behind having this new Vision by focusing on the “thriving economy” theme. We also highlight the main economic and financial targets as well as the transformative and executive programs specified within this Vision. 

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    Wed, 28 October 2015

    The impact of lower oil prices on shale oil- US Shale Oil at an Inflection Point

    US shale oil production continued to increase even as oil prices tumbled 50 percent but lower oil prices have begun to take their toll. Sustained drops in US oil production are expected as oil hedges expire, financing from secured lending is tightened and the high yield debt market becomes too expensive. Aside from shale oil, the lower oil price environment will also impact global oil supply but Saudi Arabia will be the main beneficiary when global oil markets become tighter and prices rebound by 2020.

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    Thu, 15 October 2015

    Saudi Labor Market Outlook

    The Saudi labor market has undergone significant and dynamic change over the course of the last decade. The labor market is notably segmented and unique challenges are being encountered with the employment of Saudi nationals into the private sector. This report analyses the transformation that has taken place and looks ahead to the potential significant challenges still facing the labor market within the Kingdom.  In this report, we analyze the interesting trends from the period 2005-15 and present three different scenarios as part of our forecast for the period 2015-25.

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    Mon, 08 December 2014

    Oil market dynamics and Saudi fiscal challenges

    The recent OPEC’s decision not to cut output adds further uncertainty not only on the global oil market, but also on the outlook for the Kingdom’s fiscal policy. In this report we examine the global environment that led to such decision. We note that while such decision along with other variables in the market would result in different price levels over the next two years, prices of $85 and 83 per barrel for 2015 and 2016, respectively,  are most likely. These lower prices will have a direct impact on the balance of payments and fiscal position of the Kingdom. In this report, we examine a number of fiscal policy reactions to different budgetary outcomes and implication of each on the non-oil economy.

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    Tue, 18 November 2014

    Outlook for crude oil refining- focus on the Saudi refining sector in global context

    Saudi Arabia will see 1.2 million barrels per day (mbpd) of new refining capacity come online by 2020. This includes the Satorp refinery, which is already up and running, and the Yasref refinery, which will start up in Q4 2014. This major investment in downstream sector by the Kingdom coincides with a huge growth in modern refineries in countries such as India and China, which will add around 7 mbpd of highly complex capacity globally by the end of the decade. The purpose of this report is to highlight the key trends in the international refining sector and to analyze the impact of these developments on the Saudi refining sector.

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    Tue, 17 December 2013

    The outlook for unconventional oil and gas production- Focus on tight oil and shale gas and it's impact on Saudi Arabia

    Over the last few years, the rapid increase of tight oil and shale gas production in the US has brought about a significant change to the global energy landscape. Following our publication on “Saudi Arabia’s coming oil and fiscal challenge” in July 2011, we decided to update our view on how this transformation in the energy sector could impact the Kingdom’s future standing in the world’s energy markets. By reviewing many of specialized public domain industry information, we conclude that tight oil production should not significantly affect Saudi Arabia’s situation and that shale gas production may merely induce Saudi petrochemical firms to expand production in the US.

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    Fri, 01 July 2011

    Saudi Arabia’s coming oil and fiscal challenge

    Saudi Arabia is currently enjoying oil revenues in excess of its fiscal needs, but government spending and domestic consumption of crude oil are rising far faster than overall oil output. We have examined each of these trends in detail and projected their likely path to 2030. For the next decade, high government savings mean the fiscal position remains healthy. For the 2020s, the environment will be very different.

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