Saudi Arabia signals easing in bond sales as it takes cautious approach to spending

Saudi Arabia's borrowing plan for 2026 forecasts a slowdown in the growth of international bond issuances as the kingdom adopts a more cautious approach to spending amid lower oil prices, analysts say.

Total financing needs this year are projected at $58 billion, the Ministry of Finance said on Friday. This includes $44 billion to cover the anticipated deficit and $14 billion for principal repayments.

International bond sales are expected to account for around 25 per cent to 30 per cent of total borrowing, or between $14 billion to $18 billion, “which if borne out would mark a slowdown in the rapid expansion of international issuance seen over the past several years”, Emirates NBD economists Edward Bell and Daniel Richards said in a note on Monday.

“Saudi Arabia remains committed to its Vision 2030 diversification programme, but officials have signaled a more cautious approach as lower oil prices have constrained budgets.”

In 2025, the government had planned to borrow 139 billion riyals ($37 billion) but ended up raising more than 400 billion riyals, the bank said. The kingdom did clarify that 61 billion riyals represented “pre-funding” for 2026 needs.

Saudi Arabia this year "aims to maintain debt sustainability, diversify funding sources between domestic and international markets through public and private channels by issuing bonds, sukuk, and loans at a fair cost", the ministry statement said.

"It also plans to expand alternative government funding, through project and infrastructure financing, as well as export credit agencies, during fiscal year 2026 and over the medium term, within prudent risk management frameworks and well-established foundations."​

Last month, Saudi Arabia approved its budget for next year with spending of 1.31 trillion Saudi riyals and an estimated deficit of ‍165.4 ‍billion riyals.

Emirates NBD projects Saudi Arabia's budget deficit this year will be closer to 5 per cent of its gross domestic product as compared to 3 per cent forecast by the government.

“Oil revenue will dip thanks to lower prices this year even as Saudi Arabia will keep production at more than 10 million barrels per day, while we expect a more modest rise in non-oil income than presented in the 2026 budget,” the note said.

Oil prices are expected to rem