the bottom line is that the Saudi’s need the money no matter what the price. Their hold on power there is tenuous at best even when oil is $120/bbl. To furlough people to cut production hurts them, it’s idle hands are the devil’s workshop and Allah is the devil, a short trip.
How long can the Saudi’s withstand low oil prices? One year, two years? Like all nations, they too have bills to pay and have to make investments in their future.
A reduction in revenues has opportunity costs that have to be considered.
The Saudis have enough hard currency reserve’s to fund their welfare state for the next 30 years at $40/barrel.
Russia has 2 years of hard currency reserves and Iran less.
Saudis don’t work. All these production workers are imported from various countries. It has been a big problem for decades. Saudi Arabia can’t get its people to work and this potentially is a problem for the future.