Saudi Arabia’s economy is set to grow this year at the slowest pace since 2002 as the oil-price plunge drains the Kingdom’s finances, according to projections released by the International Monetary Fund (IMF) on Tuesday. Economic growth will slow to 1.2% in 2016 from 3.4% in 2015, the IMF said in an update to its World Economic Outlook. The prolonged oil slump saddled Saudi Arabia with a budget deficit of about USD98 billion last year, pushing officials to cut spending, consider an international sovereign bond sale and cut energy subsidies. The price of Brent crude has fallen by more than 40% since October, when the IMF last released forecasts for the kingdom and said growth would be 2.2% this year. The fundamentals “seem to point to a low-for-long scenario for oil,” Maury Obtsfeld, director of the IMF’s research department, said. “With Iranian oil coming online, with the resilience in the shale extraction industry in the U.S., the possibility of shale extraction elsewhere, it’s hard to see oil going back to the $100 a barrel level anytime soon,” he said. (Bloomberg)