RIYADH: Saudi Arabia’s official reserve assets reached SR1.71 trillion ($456.97 billion) in September, marking a 4 percent increase year-on-year, according to new data.

Figures released by the Saudi Central Bank, known as SAMA, show these holdings include monetary gold, special drawing rights, the International Monetary Fund’s reserve position, and foreign reserves.

The latter, comprising currency and deposits abroad as well as investments in foreign securities, made up 94.5 percent of the total, amounting to SR1.62 trillion in September. This category grew 4.11 percent during this period.

September data indicated that special drawing rights rose to SR79.86 billion, marking a 4.18 percent increase and reaching the highest level in two and a half years. SDRs now account for 4.66 percent of Saudi Arabia’s total reserves.

Created by the IMF to supplement member countries’ official reserves, SDRs derive their value from a basket of major currencies, including the US dollar, euro, Chinese yuan, Japanese yen, and British pound sterling. They can be exchanged among governments for freely usable currencies when needed.

SDRs provide additional liquidity, stabilize exchange rates, act as a unit of account, and facilitate international trade and financial stability.

The IMF reserve position totaled around SR12.64 billion, but decreased by 11.45 percent during this period. This category represents the amount a country can draw from the IMF without conditions.

Saudi Arabia’s official reserves have been a fundamental pillar of the nation’s economic stability and are closely tied to its strategic investments in foreign securities.

The Kingdom’s reserves include an extensive portfolio of foreign assets, diversified across currencies and geographies, ensuring the country has a robust financial buffer against global economic uncertainties.

This prudent reserve management has helped Saudi Arabia maintain a resilient fiscal position and a strong credit rating, affirmed at “A/A-1” by S&P Global, which recently upgraded the Kingdom’s outlook to positive due to its sustained reform momentum.

In alignment with Vision 2030, Saudi Arabia has adopted an expansionary fiscal policy to support transformative projects aimed at reducing its economic dependence on oil.

This ambitious agenda has led to budget deficits and prompted the country to tap into debt markets to finance key infrastructure and social initiatives.

Despite the uptick in debt, the Kingdom remains fiscally well-positioned, with ample reserves and substantial net assets, projected to stay above 40 percent of GDP through 2027 according to S&P Global.

This buffer underscores Saudi Arabia’s capacity to absorb potential economic shocks while continuing to pursue its development goals.

The nation’s significant reserve base not only underpins its economic stability but also provides the flexibility to recalibrate spending on large infrastructure projects as needed, maintaining a balance between growth and fiscal discipline.

This strategy is essential as Saudi Arabia seeks to nurture its non-oil sectors, supported by the Public Investment Fund and other governmental entities.

The PIF’s role in fostering a diversified economy is central to Vision 2030’s objectives, from investment in renewable energy to technology and healthcare, creating a more resilient and diversified economic base.

With the positive outlook and strategic focus on sustainable growth, Saudi Arabia’s economic reforms are expected to drive strong non-oil growth over the medium term, further cementing the Kingdom’s fiscal stability and enhancing investor confidence in its long-term economic vision.

SINGAPORE: Oil prices fell on Friday on signs demand in China, the world’s biggest crude importer, continues to underperform amid its uneven economic recovery.

Brent crude futures were down 65 cents, or 0.9 percent, at $71.91 a barrel by 7:50 a.m. Saudi time. US West Texas Intermediate crude futures were down 62 cents, or 0.9 percent, at $68.08.

For the week, Brent is set to fall 2.7 percent while WTI is set to decline 3.3 percent.

“While oil prices have somewhat stabilized around the $71.00 level of support this week, the lack of a concrete bullish catalyst suggests that price recovery remains tepid for now,” Yeap Jun Rong, market strategist at IG, said in an email.

The prospect of higher supplies from the US and OPEC+ along with doubts over China’s economic recovery continue to be of concern, while the odds of a December rate cut are now “closer to a coin flip” under a less dovish Federal Reserve, Yeap added.

China’s oil refiners in October processed 4.6 percent less crude than a year earlier, falling year-on-year for a seventh month, amid the closures of some plants and reduced operating rates at smaller independent refiners, data from the National Bureau of Statistics showed on Friday.

The decline in run rates occurred as China’s factory output growth slowed last month and demand woes in its property sector showed few signs of abating even though consumer spending increased, government data showed.

Oil prices also fell this week as major forecasters indicated market fundamentals remained bearish.

The International Energy Agency forecast global oil supply will exceed demand in 2025 even if cuts remain in place from OPEC+, which includes the Organization of the Petroleum Exporting Countries and allies such as Russia, as rising production from the US and other outside producers outpaces sluggish demand.

The Paris-based agency raised its 2024 demand growth forecast by 60,000 barrels per day to 920,000 bpd, and left its 2025 oil demand growth forecast little changed at 990,000 bpd.

OPEC this week cut its forecast for global oil demand growth for this year and 2025, highlighting weakness in China, India and other regions, marking the producer group’s fourth-consecutive downward revision to its 2024 outlook.

US crude inventories last week rose by 2.1 million barrels, the Energy Information Administration said on Thursday, much more than analysts’ expectations for a 750,000-barrel rise.

Gasoline stocks fell by 4.4 million barrels last week to the lowest since November 2022, the EIA said, compared with analysts’ expectations in a Reuters poll for a 600,000-barrel build.

​Distillate stockpiles, which include diesel and heating oil, also fell unexpectedly by 1.4 million barrels, the data showed.