• 4 minutes Will We Ever See 100$+ OIL?
  • 8 minutes Iran downs US drone. No military response . . Just Destroy their economy. Can Senator Kerry be tried for aiding enemy ?
  • 11 minutes Energy Outlook for Renewables. Pie in the sky or real?
  • 2 mins Shale Oil will it self destruct?
  • 11 hours NYT: Mass Immigration Roundups in U.S. to Start Sunday
  • 7 hours White House insider who predicted Iran False Flag, David Goldberg found dead in his New York apartment
  • 23 hours U.S. Administration Moves To End Asylum Protections For Central Americans
  • 15 hours South Korea imports No Oil From Iran in June - First-Half Imports Fall 37%
  • 22 hours U.S.- Taiwan: China Says Will Freeze Out U.S. Companies That Sell Arms To Taiwan
  • 9 hours Germany exits coal: A model for Asia?
  • 3 hours Carrot And Stick: North Korea Suggests It Might Lift Weapons Test moratorium
  • 3 hours Migration From Eastern Europe Raises German Population To Record High
  • 3 hours Starlink Internet Courtesy of Tesla
  • 4 hours Trump vs. Xi Trade Battle, Running Commentary from Conservative Tree House
  • 2 days Oil Price Could Fall To $30 If Global Deal Not Extended
  • 2 days Rising air pollution and green house effect
Is A Crude Glut Looming?

Is A Crude Glut Looming?

Slowing global economic growth is…

Oil Exporting Nations Slash Military Spending

Army

The oil price slump and the consequent economic problems forced many oil-exporting countries to cut military spending last year, with Saudi Arabia recording the largest absolute decrease in spending—$25.8 billion—the Stockholm International Peace Research Institute (SIPRI) said in its annual update on Monday.

While in 2016 military spending in North America increased annually for the first time since 2010, and expenditure in Western Europe grew for a second year running, many oil-dependent economies saw their military budgets contract due to lower national oil revenues, SIPRI noted.

The largest percentage cuts in military spending related to falling oil income were made by collapsing economy Venezuela, 56 percent; civil war-torn South Sudan, 54 percent; Azerbaijan, 36 percent; Iraq, 36 percent; and Saudi Arabia, 30 percent. Oil producing countries including Angola, Ecuador, Kazakhstan, Mexico, Oman, and Peru also saw notable declines in their respective military expenditure, SIPRI said.

13 of the 15 countries with the largest declines in 2016 military expenditure are oil exporters, the institute data show.

Falling oil revenue and associated economic problems attached to the oil-price shock has forced many oil-exporting countries to reduce military spending,” said Dr Nan Tian, researcher with the SIPRI Arms and Military Expenditure (AMEX) program.

Meanwhile, the U.S. stayed on top of the list of countries with the highest annual military expenditure in the world. U.S military spending grew by 1.7 percent yearly to $611 billion in 2016. China came second with a 5.4 percent rise in spending to $215 billion, and Russia was third, lifting spending by 5.9 percent to $69.2 billion last year. Saudi Arabia - the third largest spender in 2015 -- dropped to fourth place in 2016, after its spending fell by 30 percent to $63.7 billion, “despite its continued involvement in regional wars,” SIPRI said.

Related: Exxon Attempts To Maneuver Around Russian Sanctions

Aeveral oil-exporting countries -- namely Algeria, Iran, Kuwait, and Norway – bucked the trend and continued on with their spending plans last year, since they were better prepared to face the oil price shock, according to SIPRI.

Feeling the effects of the oil price crash, Saudi Arabia has not only cut military spending, it is also looking to freeze multi-billion-dollar projects.

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage

Leave a comment
  • Lee James on April 24 2017 said:
    Russia's military spending is of considerable interest to the Western world. Considering what all Russia is militarily into at home and abroad, the level of spending cited here seems low. I wonder if Russian military spending is actually a closely guarded state secret. Better for the Russian government to under-report to its citizens as well as abroad.

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News
Download on the App Store Get it on Google Play