Saudi Arabia to adopt 'balanced plan' to tackle oil revenue changes: Al-Falih

Saudi Arabia has a balanced plan to adapt to changes in oil revenue, as it is very difficult for any state, including the Kingdom, to fully depend on its crude price estimate, energy minister, Khalid Al-Falih, told Argaam in a press conference on Wednesday.

The financial committee, headed by Saudi Crown Prince, Mohammed bin Salman, has developed four scenarios for next year's oil prices, which are historically impacted by several variables.

The basic scenario depends on just 50 percent of oil revenue, along with a high percentage of non-oil revenue, borrowing and drawdowns from reserves, when necessary.

"Oil markets have shown strong recovery, thanks to the Kingdom's role. Brent prices are hovering around $64 per barrel … I believe the 2017 recovery will continue in 2018 and we hope this will reflect on revenue and pile-up of reserves," Al-Falih said, adding he is very optimistic about the oil market.

Meanwhile, the world's top oil exporter Saudi Aramco is planning to spend over SAR 400 billion within the next three years, of which SAR 120 billion will be invested in 2018.

The state-run oil producer has launched IKTVA initiative, to enhance localization in the Kingdom, Al-Falih said on the sidelines of the conference, adding the localization of spending in Saudi Arabia is likely to hit 50 percent next year.

Mega projects will come on stream in 2018, including the Jazan refinery, which will begin commercial operations in late 2018, in addition to completion of Fadhili plant and Khurais field expansion.