Saudi Currency Black Swan

 "Which brings up the question of devaluation: how long until the SAR has to follow the Yuan and see a substantial haircut. According to the market, 12 month SAR forward are now trading at a price which implies a 12% devaluation in the coming months. When that happens is, of course, up to the King Salman. What it also means is that as Saudi Arabia is now scrambling to generate any incremental cash, it too will be caught in the deflationary spiral of excess production as it will have no choice but to outsell its competitors, especially those rushing to grab Chinese market share such as Russia, as it seeks to make up with volume what it has lost due to lower prices. It also means that any hopes of a production freeze by Saudi Arabia - and thus OPEC - are hereby snuffed for the indefinite future."

Are The Saudis Facing A Full-Blown Liquidity Crisis? | OilPrice.com

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