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Economy News - Baghdad
On Saturday, the financial advisor to the Prime Minister, Mazhar Muhammad Salih, identified two factors that play their role in ensuring the sustainability of the demand for Iraqi oil for the coming years, while noting that the oil resource constitutes the base of the tripartite budget revenues by 90%.
Saleh said, "There are two factors that play their role in ensuring the sustainability of demand for Iraqi crude oil for the coming years, and that global crude oil price rates during the current and next years will not be less than an average of $77 a barrel, and for two central reasons surrounding the global economy," according to the official news agency. .
He explained, "The first reason is that India and China are still reaping the highest economic growth rates in the world, and they are on their way to leading the global economy in a sustainable manner in the next two decades without a doubt, which increases their demand for crude oil to sustain the wheels of industrial production in them and strongly, just as Their demand for the oil of the West Asian markets, which is the closest and truly abundant, will continue because of the large reserves that are close to half of the world’s oil reserves and the abundance of production, and with this the two countries (India and China) will constitute the safety valve in stopping the advance of global inflationary depression that is expanding through the symbolic markets of the Western industrial world now. .
He pointed out that "there is a positive relationship between the high rates of economic growth and the high demand for energy resources, specifically crude oil, as the Indian and Chinese markets constitute the main import center for the oils of the Gulf region within the growing economies of Asia on the one hand, and the oil of Iraq in particular on the other hand, and India is And China is the two largest customers in importing Iraqi oil, and they constitute the center of gravity in the two movements of the Iraqi trade balance now.
He continued, "As for the second and important reason or factor in the conditions of the global energy market, it is represented by the continuation of the war in Ukraine on the one hand, and the world's high needs for crude oil on the other hand, and oil prices will not fall below an annual rate that, in our estimate for the current and next years, is not less than $77 a barrel." On average, as we mentioned, that is as long as the Ukrainian-Russian war continues and affects Russia's energy supplies.
And he added, "Especially since Russia, in which oil and gas production constitutes the second position in the world, is in a difficult position in marketing energy products and exporting them globally at equilibrium prices, which means that the Ukrainian war and Russia's blockade of Western countries is still blocking the regular flow of oil and gas resources from Those countries to the markets of the West, in order to meet the increasing demand for energy resources, which made reliance on alternative energy production centers, but at a high cost, specifically the American oil market, meaning that the lack of Russian oil and gas has raised the cost of producing alternatives in the world and set minimum costs that will make oil prices It fluctuates between 77-87 dollars per barrel as long as the war is raging in Ukraine until now.”
He concluded by saying: "In light of the foregoing, and since the oil resource constitutes the base of the tripartite budget revenues by nearly 90%, there is a positive bet on the regularity of funding the federal general budget from the oil resource exported to world markets without stumbling blocks that lead to resorting to borrowing or any financing methods that represent A burden on the tripartite budget or the country's financial strengthening.
Added 07/15/2023 - 6:59 PM
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