13:43 - 2023-09-09
The financial advisor to the Prime Minister, Mazhar Muhammad Saleh, confirmed today, Saturday, that the rising prices of oil asset cycles reduces the hypothetical deficit gap in the federal general budget.
Saleh said, in a press interview, that “the oil markets indicate a significant increase in the prices of the cycle of oil assets, as Brent crude oil has exceeded the barrier of $90 per barrel, which has a positive impact on reducing the hypothetical deficit gap in the federal general budget (which is the budget approved under Law No. 13 of 2013), estimated at approximately 64 trillion dinars as an average deficit in the fiscal years 2023, 2024 and 2025, which was adopted as a preventive financial buffer to confront fluctuations in oil prices and demand surprises in energy markets.
He added, "What matters is that the average prices of exported oil during the fiscal year exceed the default price approved by the budget for a barrel of Iraqi exported oil, amounting to 70 US dollars. Therefore, any sales exceeding the above-mentioned default price will undoubtedly lead to reducing the gap in the hypothetical deficit and in a clear inverse relationship." .
He continued: “We believe that the budget for the next two years will maintain its constants and its preventive and precautionary measures regarding the development of prices in the oil markets and its relationship to the hypothetical deficit, especially for the fiscal year 2024, as the northern hemisphere is facing a high demand to build stocks facing the winter, and the indicators of war in “Ukraine indicates its continuation, and that the OPEC Plus group is also continuing the policy of limiting the quantities produced to maintain prices for exported oil that are commensurate with the stability of the revenues of its countries’ financial budgets.”
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