British report: Saudi Arabia is causing disaster for the Iraqi economy
13:55 - 03/28/2020
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A report of the British newspaper (Arab Weekly) said Saturday that Saudi Arabia's dumping of the global oil market in its economic war with Russia will lead to an economic catastrophe for Iraq, a country that is already facing an increasingly unstable and volatile situation.
The report, which was translated by the information, stated that “the sharp decline in the global oil markets, the spread of the Corona virus epidemic, and the dumping of Saudi Arabia to the world market with oil, which led to the price of a barrel reaching $ 25, which is half of what it was when the sharp drop in the world oil price was largely a beginning This year will have severe economic repercussions for the country. ”
"What Saudi Arabia is doing is part of an attempt to acquire Russia's market share with China and India, and Riyadh is doing so out of anger at Moscow for its refusal to support proposed production cuts at the OPEC + meeting early this month," he added.
Economist Joel Wing said, "This step can do great harm to the economy of [You must be registered and logged in to see this link.] at a time when the country is already grappling with other major crises, in a country that is most dependent on oil in the world."
"At current prices, the Iraqi government will not be able to pay salaries or pay pensions, which is the largest cost in its budget, and it will not likely be able to pay the oil companies operating in the country," Wing added.
He continued, “Baghdad may decide to cut its own production, but this will lead to less money, and as a result of the aggravation of things, the political class has been paralyzed by the inability to choose a new prime minister, so the country does not have the correct leadership when it needs it, and until then it was not The Iraqi elite is good at planning. ”
He noted that "when [You must be registered and logged in to see this link.] benefited[You must be registered and logged in to see this link.] From the rise in oil prices, the money was used to pay hundreds of thousands of additional government jobs that they distributed to their patronage networks to stay in power, and, moreover, the Iraqi government never prepared for low oil prices, which was unavoidable and predictable. ”
He explained that "Baghdad will have to implement massive austerity measures, raid its foreign currency reserves and try to borrow money to bypass this new crisis," warning that "this could lead to a new wave of protests that may be greater than previous protests."
On his part, Andrew Scott Cooper, historian and author of “Kings of Oil,” said that “Saudi Arabia’s oil markets remain a vital tool in the national security arsenal. In the years 1977, 1985, 1990, and again in 2008, the Saudis were fully prepared to dump the market to help their friends in West, while settling regional accounts with competitors like [You must be registered and logged in to see this link.] And Iraq. ” Ended / 25 z