[size=36]A new government statement on the 2022 budget and oil prices: subject to three factors[/size]
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, the financial advisor to the Prime Minister, Mazhar Muhammad Salih, commented on Sunday again about the 2022 budget and oil prices.
Saleh said, according to the official newspaper, that "the rises in crude oil prices are subject to three factors: the first is the price averages throughout the fiscal year, the second is the exported quantities, and the third factor is hedging against the fluctuations of the oil market because the asset cycle in it is fraught with risks, once supply rises above demand." There is a so-called "oil glut" that leads to serious collapses in crude oil prices."
And he indicated that "according to the (financial management law) in force, which urges the adoption of an average price of a barrel of oil for the purposes of calculating oil revenues in the budget in a rational and conservative manner," the public budgets of the Republic of Iraq are designed on oil prices lower than the market price and generate a potential or hypothetical deficit surrounded by a financial buffer. It collects oil revenues that exceed the price of a barrel of oil specified in the budget to feed expenditures without resorting to borrowing in case the deficit is actually.”
He explained that “the problem in the budget is always (non-oil) revenues that do not reach the ceiling of the targeted expectations.”
He added, "If we expect, for example, (50 dollars) as the price of a barrel for the next year's budget 2022, we must obtain an average annual return from oil exports by exporting more than three million barrels and at a price per barrel of oil not less than 75 dollars annually, and if it is achieved Surpluses due to the rise in the average price of a barrel to above $75 as an annual average during the fiscal year, so it must be employed for the investment budget and the operation of projects in the following year 2023.” Ended 29/A43