The cost of insuring Saudi Arabia’s debt is hovering at the same level as debt from Portugal, a nation still saddled with a junk credit-rating five years after an international bailout.

The cost for insuring Saudi Arabia’s debt more than doubled in the past 12 months to a 190 basis points range on 12 January, or $190,000 annually to insure $10m of the country’s debt for five years, according to CMA prices compiled by news agency Bloomberg. This is similar to debt from Portugal, whose rating is seven levels below Saudi Arabia’s Aa3 investment grade at Moody’s Investors Service.

Saudi Arabia is grappling with a slowing economy and dwindling revenues as crude oil prices are languishing at the lowest level in almost 12 years. The country, which counts on energy exports for 70 per cent of government revenue, sold domestic bonds for the first time since 2007 last year to help plug the budget deficit. Net foreign assets dropped for 10 straight months through November, the longest streak since at least 2006, to $627bn, according to Bloomberg.

The Saudi government, which doesn’t have any outstanding international bonds, said in 28 December budget announcement that it will choose from options including selling local and international debt and drawing from its reserves to finance 2016 budget deficit of about $87bn.

The bonds of state-controlled Saudi Electricity Company, used as a proxy for the government in the absence of any international sovereign debt, have tumbled as oil retreated. Saudi Arabia last month announced spending and subsidy cuts, reflecting scaled-back revenue expectations. It estimates cutting expenditure to $224bn in 2016.

Traders are insuring more Saudi debt than ever, with outstanding contracts covering an unprecedented $636m as of 1 January, Bloomberg reported, citing Depository Trust & Clearing Corporation data. While that’s less than half the bonds insured from the UAE, it’s a leap for a nation whose debt-to-gross domestic product rose to almost 7 per cent last year from less than 2 per cent in 2014, according to the International Monetary Fund.