(Bloomberg) --

Saudi Arabia has raised its state revenue expectations for next year and plans to narrow its budget deficit to 1.6% of economic output as higher oil prices and production give the kingdom a boost.

Revenue is expected to reach 903 billion riyals in 2022, higher than a forecast last year of 864 billion riyals, the finance ministry said in a preliminary budget statement. Spending is expected to be the same as planned at 955 billion riyals. Meanwhile, this year’s budget deficit is expected to narrow to 85 billion riyals, or 2.7% of gross domestic product, significantly lower than the ministry’s target of 141 billion riyals. The figures are subject to change in a final budget announcement that usually falls in December.

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