Rising oil output boosted Saudi Arabia’s economic growth to its fastest pace in over a year in the second quarter of 2015, according to data released by the country’s state statistics department.

GDP expanded 3.8% from a year earlier in the second quarter, reported Reuters, compared to 2.3% in the first quarter.

These figures, however, are expected to go into decline as the reality of prolonged low oil prices catches up with the Saudi economy thanks to budget deficits and circulating rumours of infrastructure spending cuts.

“We are likely to see a gradual deceleration in growth going forward – though it will not be abrupt,” said Monica Malik, chief economist at Abu Dhabi Commercial Bank.

In a related development, Trade Arabia quoted a statement by the Saudi Electricity Company (SEC) that it had has received approval from its executive committee to negotiate for loan financing worth $2.3 billion and to set up a sukuk programme worth as much as $1.5 billion.

Sukuk or Islamic bonds have been associated with deficit-financing in Saudi Arabia and other Gulf Arab states thanks to the oil price slump.