Saudi Arabia posts SR125.7 billion deficit in Q1 2026 on lower oil revenues

Saudi Arabia recorded a budget deficit of 125.7 billion riyals ($33.5 billion) in the first quarter of 2026, as a decline in oil revenues and a sharp rise in government spending weighed on public finances, the Ministry of Finance said.

Total revenues reached SR260.97 billion in Q1, with oil income contributing SR144.72 billion despite a 3 per cent year-on-year decline, the ministry said in its quarterly budget report.

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Non-oil revenues rose 2 per cent to SR116.25 billion, supported mainly by taxes on goods and services, which generated SR74.93 billion.

Government expenditure climbed 20 per cent year-on-year to SR386.69 billion, reflecting higher spending on operations and capital projects.

Compensation of employees stood at SR151.06 billion, while spending on goods and services rose to SR98.05 billion. Capital expenditure reached SR43.43 billion, underscoring continued investment in infrastructure and development.

The deficit was fully financed through borrowing, with total financing matching the shortfall at SR125.7 billion.

Public debt rose to SR1.67 trillion by the end of the quarter, up from SR1.52 trillion at the start of the year. Domestic debt accounted for SR1.04 trillion, while external debt stood at SR624.4 billion.

Government reserves reached SR400.93 billion, while the current account balance stood at SR67.67 billion at the end of the period under review.

Spending increased across most sectors, including military and security, education, health and social development, and infrastructure, the ministry said.