Intel Corp (INTC)

[Professor MD]

Andy Grave

Saudi Arabia put themselves in a precarious position: likely to post a deficit of nearly 20% of GDP for 2015
A report from the International Monetary Fund released August 17, projects that Saudi Arabia will likely post a fiscal deficit of 19.5% of GDP in 2015, compared to a deficit of 3% of GDP in 2014. The IMF anticipates that the deficit will decline after this year, but it will remain high over the medium-term.
Saudi’s financial reserves peaked at $737 billion in August of 2014. They sat at $672 billion in May 2015, but with Brent below $45 per barrel, the Kingdom will need to spend at least $12 billion per month from its sovereign fund in order to support social spending.

Petrie’s take: Saudi won’t sell assets
Tom Petrie, chairman of Petrie Partners, said selling assets is not the most likely way Saudi Arabia will fund its social programs. “Conceivably, they have some stocks, but this is not the kind of environment you want to go into trying to raise big money from the stock market,” he said during an interview with Oil & Gas 360®. “I think they’re more likely to issue debt”

http://www.oilandgas360.com/saudi-market-therapy/

The situation in Saudi Arabia is similar to the situation at the oil-rich Emirates, (like Abu Dhabi, and Dubai). The rulers of all of them stay in power by maintaining a high standard of living for the citizens as well as a gigantic royal family.
The recent news from Global Foundries and AMD reflect Abu Dhabi’s inability to support them.