Five years into Saudi Vision 2030: How did energy evolve?
https://arab.news/zjanf
Non-oil income is one of the most important goals of Vision 2030, as it means the Kingdom is no longer at the mercy of volatile oil prices, which for many years have disrupted development plans.
Upon launching Saudi Vision 2030 five years ago, the Saudi Ministry of Petroleum changed its name to the Ministry of Energy, marking the new era in which oil became a part of the Kingdom’s overall energy mix, in line with plans to diversify the economy.
It also reflects the Kingdom’s leading role in stabilizing oil markets and enhancing the security, sustainability, and reliability of global supplies. The Kingdom’s Vision 2030 was launched in 2016, when the average price of Brent crude was at $44, followed by $54 in 2017, $71 in 2018, $64 in 2019, $42 in 2020 and around $61 so far for 2021.
During the past five years, the world has endured economic crises that the Kingdom was able to tackle, proving that Saudi Arabia’s economy can reach the Vision 2030 goals in both the good and bad times.
In the last year, the global economy has been paralyzed by the COVID-19 pandemic. However, Saudi financial figures prove the success of its Vision 2030 goal to diversify the economy away from hydrocarbons.
Comprehensive economic reforms have resulted in non-oil revenues reaching SR369 billion in 2020, from SR166 billion in 2015, an increase of 222 percent.
While the world faced a sudden bleak economic darkness, the Kingdom was one of the most prepared countries.
Vision 2030’s programs and initiatives are continuing and have fundamentally contributed to strengthening governance and transparency, developing new policies, preventing corruption, measuring performance, and restructuring some government agencies.
With the launch of Vision 2030 in 2016, the Kingdom succeeded in leading the major producers inside and outside OPEC to agree on a production strategy to balance oil markets and absorb the surplus stocks. Saudi Arabia implemented the largest ever oil production cut to contain the most significant demand shock in history.
The Saudi Aramco IPO was part of a drive to improve performance and efficiency. By raising the level of governance and transparency, the company will be able to maximize profit and enable future sustainability. Saudi Aramco’s IPO was considered the most important move in the history of the oil industry.
• Faisal Faeq is an energy and oil marketing adviser. He was formerly with OPEC and Saudi Aramco. Twitter: @faisalfaeq
