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Established in 2006 as a Community of Reality

Welcome to the Neno's Place!

Neno's Place Established in 2006 as a Community of Reality


Neno

I can be reached by phone or text 8am-7pm cst 972-768-9772 or, once joining the board I can be reached by a (PM) Private Message.

Established in 2006 as a Community of Reality

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Established in 2006 as a Community of Reality

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    The Oil and Iraq Equation: A Danger Chasing the Budget and Multiple Factors for Its Decline

    Rocky
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    • Post n°1

    The Oil and Iraq Equation: A Danger Chasing the Budget and Multiple Factors for Its Decline Empty The Oil and Iraq Equation: A Danger Chasing the Budget and Multiple Factors for Its Decline

    Post by Rocky Wed 04 Sep 2024, 4:53 am

    The Oil and Iraq Equation: A Danger Chasing the Budget and Multiple Factors for Its Decline

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    Economy News - Baghdad
     
    [rtl]In light of the financial and economic crises, Iraq faces a new challenge resulting from the decline in oil prices in global markets, which poses a threat to the country's budget, which depends 95% on black gold, which raises many questions about the actual reasons that led to the decline in prices to unprecedented levels during the current year.[/rtl]
     
    [rtl]The Iraqi government is relying on oil prices rising above $70 per barrel to cover the actual budget deficit, which amounts to 64 trillion dinars, at a time when oil prices have fallen to $73 per barrel, amid pessimistic expectations about the future of oil and its prices. [/rtl]
     
    [rtl]For his part, member of the Parliamentary Finance Committee, Mustafa Sand, said that the price of Iraqi oil fell today to $69 per barrel.
     
    Sand confirmed in a post followed by "Al-Eqtisad News" that "the estimated price of oil in the current year's financial budget has reached $80 per barrel."
     
    He added, "Our oil is sold at its monthly price, not its daily price."[/rtl]
     
    [rtl]In addition, economic expert Mustafa Hantoush identified three factors behind the fluctuation of oil prices in global markets, while stressing that oil smuggling creates a new market that covers global production without the official market.[/rtl]
     
    [rtl]Hantoush said in an interview with Al-Eqtisad News, “The continued fluctuation of oil prices is due to three factors, including international policies, represented by the vision of the United States of America, which focuses on oil prices being below $70 per barrel, i.e. from $60-65, given that it is an exporter of Sarkha oil, which costs from $50 to $55.”[/rtl]
     
    [rtl]He added, "America is working on importing large quantities of various oils, and therefore it is looking for a state of balance, in addition to its European partners who have real problems with the rise in oil prices today, which is what is pushing them to pressure America to reduce prices."[/rtl]
     
    [rtl]He points out that "the other factor is the economic situation, which is related to the slowdown in global growth, which came contrary to the expectations that were set, and thus this leads to producers not exaggerating in purchasing, storing and consuming operations, which leads to fluctuations in demand for oil."[/rtl]
     
    [rtl]“The third factor is the security situation, as oil prices are linked to a country like Russia, which used to export 12 million barrels, and today exports 4.5 to 5 million barrels,” Hantoush explains, stressing: “With the end of the Russian-Ukrainian war approaching, which may push Moscow to reactivate agreements with some unilateral countries, away from OPEC Plus, and export oil officially.”[/rtl]
     
    [rtl]Regarding smuggling operations, the economic expert explains, “There are smuggling operations through informal markets from many countries, and there is an increase in these operations, which leads to the existence of another market that covers the need for global production without the official market.”[/rtl]
     
    [rtl]The OPEC+ alliance, which includes the Organization of the Petroleum Exporting Countries and allies led by Russia, has currently cut production by a total of 5.86 million barrels per day, representing about 5.7% of global demand.[/rtl]
    [rtl]Analysts expect OPEC+ to extend voluntary cuts for a few months due to lower oil prices and slowing demand.[/rtl]
     
    [rtl]Iraq recently agreed to reduce oil production, in accordance with the policy imposed on it by OPEC.[/rtl]
     
    [rtl]Reuters reported last Thursday that Iraq intends to reduce its oil production to between 3.85 million and 3.9 million barrels per day in September, as part of a plan agreed upon with the OPEC+ alliance to compensate for production exceeding its share.[/rtl]
    [rtl]‎[/rtl]
    [rtl]The Iraqi Ministry of Oil submitted a plan to OPEC to compensate for the surplus production between this month and September of next year.[/rtl]
     
    [rtl]In addition, economic expert Nabil Al-Marsoumi revealed a new challenge facing the government due to the decline in oil prices, indicating that the decline is due to fears of a slowdown in demand.[/rtl]
     
    [rtl]Al-Marsoumi said in a post on Facebook, which was followed by “Al-Eqtisad News”, that “the price of Brent crude has dropped to $74, which means that the price of Basra medium crude will become $72, which constitutes two-thirds of Iraq’s oil exports, and Basra heavy crude, which constitutes a third of oil exports, will be $70 per barrel due to fears of a possible slowdown in demand from China, a major importer, in addition to the possibility of an increase in oil supply from OPEC Plus, which reports indicate is planning to increase production by 2.2 million barrels per day next October.”[/rtl]
     
    [rtl]He points out that "this decline in prices will negatively affect the general budget in Iraq, which was counting on obtaining 16 trillion dinars from the rise in oil prices above $70 to cover the budget deficit of 64 trillion dinars."[/rtl]


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