# Saudi Arabia posts its largest-ever quarterly deficit on war spending > A $33.5bn Q1 hole — most of the year's planned shortfall in one quarter — as military outlays jumped and Hormuz throttled oil exports despite high prices **Meta:** type: story · date: 2026-06-24 · heads: Dinheiro de quem, O que quebrou · 9 takes · 1 lenses · 6 regions ## Summary [Saudi Arabia](/pt/entity/saudi-arabia) posted a record quarterly budget deficit of SAR 125.7bn ($33.5bn) in Q1 2026 — roughly 76% of the full-year SAR 165bn target in a single quarter. Expenditure hit a record SAR 386.7bn ($103.2bn), up 20% year on year, with military spending up 26% as the [Iran war](/pt/n/iran-us-ceasefire-mou) ran from late February. Revenue was SAR 261bn; oil revenue fell 3% despite Brent averaging above $107, because output collapsed to around 7.25 mb/d against roughly 10.1 mb/d budgeted, after March's [Strait of Hormuz disruption](/pt/n/hormuz-oil-supply-shock) cut exports. The shock inverted the usual logic — a wartime price surge that would normally swell revenue instead coincided with a deficit, because [Mohammed Bin Salman](/pt/entity/mohammed-bin-salman)'s barrels could not reach market. Vision 2030 enters its final 2026-30 phase against this strained backdrop. ## By the numbers - SAR 125.7bn ($33.5bn) — Q1 2026 deficit, the largest on record. - ~76% — share of the full-year SAR 165bn deficit target spent in one quarter. - +20% / +26% — total spending / military spending, year on year. - ~7.25 mb/d — Q1 oil output vs ~10.1 mb/d budgeted, after Hormuz disruption. - >$107 — average Brent in Q1, yet oil revenue fell 3%. ## Why it matters The deficit shows how the war hit Riyadh through volume, not price: high crude was worthless while Hormuz was closed. It tightens the squeeze on Vision 2030 already forcing NEOM cuts and a more disciplined PIF strategy, and raises the breakeven oil price the kingdom needs just as the ceasefire sends crude down. ## What to watch - Q2 figures once Hormuz reopens and exports normalise. - Any spending cuts or borrowing to cover the gap. - The oil-price breakeven against post-ceasefire crude near $77. ## Regional takes (batched by bias / lens) ### unlabelled - **Saudi Ministry of Finance** (Saudi Arabia, ar) — The FY2026 budget statement (PDF) — the official record of the SAR 165bn annual deficit target against which the Q1 SAR 125.7bn ($33.5bn) shortfall is measured, and the spending and revenue assumptions that the war upended. Source: https://www.mof.gov.sa/en/budget/2026/BudgetStatementDocs/Eng_2026.pdf - **Asharq Al-Awsat** (Saudi Arabia, ar) — Saudi-owned pan-Arab paper frames the record spending as deliberate 'strategic spending' that strengthens resilience, casting the deficit as managed investment in stability rather than a fiscal shock. > "Q1 'strategic spending' of $103 billion strengthens Saudi economic resilience." Source: https://english.aawsat.com/business/5270134-saudi-q1-budget-strategic-spending-103-billion-strengthens-economic-resilience - **AGBI** (United Kingdom, en) — Gulf business outlet attributes the record deficit squarely to war costs — a 26% jump in military spending and an oil-output collapse — framing it as the price of the Iran conflict rather than strategic choice. > "Saudi Arabia suffers a record deficit due to war costs as military spending surged 26%." Source: https://www.agbi.com/economy/2026/05/saudi-arabia-suffers-record-deficit-due-to-war-costs/ - **MEES** (Cyprus, en) — Energy-finance specialist whose pre-event call — that the price surge would narrow the deficit — was contradicted by the output collapse, a useful marker of how the war's fiscal effect defied the price logic. > "The deficit could narrow as conflict drives an oil-price surge — a forecast the output collapse overturned." Source: https://www.mees.com/2026/3/20/economics-finance/saudi-deficit-could-narrow-as-conflict-drives-oil-price-surge/d36ca930-2468-11f1-ae68-bba116918286 - **Al Jazeera** (Qatar, en) — Source: https://www.aljazeera.com/economy/2026/5/6/saudi-arabia-posts-33-5bn-budget-deficit-amid-drop-in-oil-sales - **Al Arabiya** (Saudi Arabia, en) — Source: https://english.alarabiya.net/business/economy/2026/05/05/saudi-budget-spending-rises-20-percent-to-387-billion-riyals-in-q1 - **Saudi Gazette** (Saudi Arabia, en) — Source: https://saudigazette.com.sa/article/661098 - **Gulf News** (United Arab Emirates, en) — Source: https://gulfnews.com/world/gulf/saudi/saudi-arabia-posts-sr1257-billion-deficit-in-q1-2026-on-lower-oil-revenues-1.500530610 - **AGSI** (United States, en) — Source: https://agsi.org/analysis/putting-the-2026-saudi-budget-under-the-microscope/ ## Across the graph - Related: [[opec-plus-july-output]], [[oil-price-iran-ceasefire]] - Entities: Mohammed Bin Salman, Saudi Arabia --- Canonical: https://rbtfl.xyz/pt/n/saudi-q1-record-deficit