The Saudi stock market registered its largest gain this year after King Abdullah's reassurance that the economy remained solid despite the global economic crisis. The Tadawul All-Shares Index (TASI) closed at 4,845,11 points on the first day of the trading week after having hit a five-year low of 4,200 points last week, mainly because investors were alarmed by the sharp declines in crude oil prices. King Abdullah also helped boost the market by stating that oil price should be $75 a barrel, higher than the current price of $54 per barrel and far lower than the peak price of $147 a barrel in mid-July. “We believe the fair price for oil is $75 a barrel,” the Custodian of the Two Holy Mosques said in an interview published Saturday in Kuwait's Al-Siyasat newspaper. The King stated that the Saudi economy “is solid and strong” and that Saudi sovereign funds are “safe and unaffected” by the global financial crisis. In view of the “excellent” economic situation, the five-year development plan will continue as planned, the King said, reassuring the Saudi people that they will not suffer any losses. “As a state – and money of the state – we have not been harmed,” the King said. “The oil surpluses are safe and not facing any complications in the world markets, and the private sector is capable of protecting its wealth and investments. “The five-year development plan will go ahead as planned, involving an announced expenditure of more than $200 billion,” the King said. The expenditure excludes allocations in the next budget for infrastructure development, construction and urban projects, he said. “Our country's economy is solid and strong, our people need to be assured and made aware of that,” the King said. “Our people would not suffer any loss they are just victims of undue panic. I repeat, and repeat it again that the conditions are good for our country.” The King said the panic is media-borne and unjustified, to the extent that people do not know whom to believe. “We assure the citizens that from the facts we know and feel, the Saudi sovereign funds are immune from the global economic crisis,” the King said. “When we tell the people that the development plans are on course, we say that with honesty. We have nothing to hide. Development budget figures are all before the people.” The King called for patience, saying that panic over the global panic, “may have created some of the slowdown” but “it is unjustified panic that will vanish away.” Speaking about the effect of low oil prices on the revenues of oil producing countries, the King said the fair price of oil is $75 per barrel. “Our budgets were estimated... at the last least price,” he said. “We consider any increases as surpluses of assets and sovereign funds.” The King reiterated that Saudi Arabia is “not concerned with the world economic calamities and they will not harm us.” “As I told you, the cure for panic over money is to wait for some time,” he said. __
