By Ahmed Mousa Jiyad.
Midyear Review of the State Budget and Oil Export Revenues
The State budget for 2015 was based on an oil export volume of 3.3 million barrels per day (mbd) and a price of $56 a barrel. Accordingly, oil export revenues were estimated to finance 83% of budget revenues.
Despite marked improvement in oil production and exports, data for the first half of this year shows, once again, reality does not coincides with budget’s expectation.
This paper argues that for oil export revenues to reach a budget breakeven the equalizer threshold for Iraq is ca. 4mbd and for KRG it is ca. 800kbd for the entire second half of the year.
Both these equalizer thresholds are, most likely, unattainable under current national and international conditions causing serious budget fiscal deficit, increases uncertainty and economic difficulties in the country.
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By Ahmed Mousa Jiyad. Any opinions expressed are those of the author, and do not necessarily reflect the views of Iraq Business News.
Mr Jiyad is an independent development consultant, scholar and Associate with Centre for Global Energy Studies (CGES), London. He was formerly a senior economist with the Iraq National Oil Company and Iraq’s Ministry of Oil, Chief Expert for the Council of Ministers, Director at the Ministry of Trade, and International Specialist with UN organizations in Uganda, Sudan and Jordan. He is now based in Norway (Email: firstname.lastname@example.org, Skype ID: Ahmed Mousa Jiyad).