BENGALURU- Economic growth in five countries in the six-member Gulf Cooperation Council is forecast to be even weaker than expected three months earlier on lower prices of oil, the region’s main export, according to a Reuters poll of economists.
Brent crude the global benchmark of oil price, has fallen from a near record-high of $139/barrel last March to around $79.
It is despite the Organization of the Petroleum Exporting Countries, and allies led by Russia (OPEC+), cutting oil output in November by 3.66 million barrels per day over poor demand.
Saudi Arabia’s economy, the world’s second-largest oil producer, was expected to expand 1.1 percent this year, according to a July 10-18 Reuters poll of 17 economists, less than half of 3.2 percent growth rate predicted in an April poll. It grew 8.7 percent in 2022.
“On the back of the extension to the voluntary oil output cut, we have nudged down our GDP growth forecast for 2023 and expect the Saudi economy to stagnate,” noted James Swanston, emerging markets economist at Capital Economics.
“The latest round of agreed OPEC+ oil output cuts will drive a sharp economic slowdown in the Gulf states. Despite the cuts to production, oil prices haven’t rallied as some members might have hoped.” -Reuters
