Oil revenue stabilization funds provide short-run protection against oil revenue fluctuations – in the way that Saudi government deposits and reserve at the Saudi Arabian Monetary Authority (SAMA) have historically served as a buffer to decouple government budget from oil revenue fluctuations. By contrast, sovereign wealth funds create income for future generations to replace revenue streams from depletable resources – one of the purposes of Saudi Arabia’s Public Investment Fund. We developed a framework for optimizing policies for adding to and withdrawing from stabilization funds, which we apply to Saudi Arabia as a case study based on publicly available data. The quantitative results are sensitive to the specific assumptions on the likelihood of particular oil prices arising but the overall results are robust to a wide range of assumptions.

Fellow
Nader AlKathiri is a fellow in the Energy Macro & Microeconomics program. He currently leads a project exploring how different…
Nader AlKathiri is a fellow in the Energy Macro & Microeconomics program. He currently leads a project exploring how different energy transition pathways impact the economies of developing and developed countries, aiming to enhance our understanding of the challenges and opportunities that lie ahead in achieving net-zero emissions. Nader’s research has been published in several international peer-reviewed journals such as Energy Economics, Resources Policy, and Applied Economics. Nader holds a Ph.D. in Economics from the University of Sussex and an M.Sc. in Applied Mathematics and Computational Sciences from KAUST. He also holds an MBA in Finance from Prince Sultan University and a B.Sc. degree in Operations Research from King Saud University.
Expertise
- Energy Economics; Economic Diversification; Macroeconomics; Development Economics; Energy Transition
Publications See all Nader AlKathiri’s publications
The impact of fiscal policy on non-oil GDP in Saudi Arabia
Oil revenue stabilization funds provide short-run protection against oil revenue fluctuations – in the way…
9th September 2022
Labour Productivity Growth and Convergence in Manufacturing: A Nonparametric Production Frontier Approach
Oil revenue stabilization funds provide short-run protection against oil revenue fluctuations – in the way…
1st September 2022