A “disturbing” economic vision about the relationship between oil prices and the budget deficit
A “disturbing” economic vision about the relationship between oil prices and the budget deficit
9-8-2023
Information / Baghdad..
Today, Friday (September 8, 2023), economist Nabil Al-Marsoumi confirmed that the oil revenues achieved until August 2023 amounted to 61.513 billion dollars, which is equivalent to 80 trillion dinars, while he indicated that the estimated oil revenues in the 2023 budget = 90 billion dollars, which is equivalent to 117 trillion dinars.
Al-Marsoumi said in a post that I followed / the information /, that “the oil revenues achieved until August 2023 = 61.513 billion dollars, which is equivalent to 80 trillion dinars,” noting that “the estimated oil revenues in the 2023 budget = 90 billion dollars, which is equivalent to 117 trillion dinars.”
He continued, “If high oil prices continue and Iraq sells its oil at 85 a barrel, it is possible for Iraq to achieve oil revenues of $8.7 billion per month during the remaining third of this year.”
He pointed out, “Oil revenues may reach 34.8 billion dollars from September to December 2023, and thus the oil revenues actually achieved in 2023 will be about 96.213 billion dollars, or 125 trillion dinars, and then the actual oil revenues will achieve in 2023 a surplus of 6.213 billion dollars, that is, 6.213 billion dollars.” 8 trillion dinars, which will reduce the deficit in the 2023 budget by the surplus in oil revenues, provided that all non-oil revenues estimated in the 2023 budget are realized at about 17 trillion dinars, which may be unlikely.
And the economist stated, “The net non-oil revenues achieved during the first half of 2023 did not exceed 421 billion dinars, and therefore it will not greatly reduce the high price of oil if it continues from the budget deficit for the year 2023.”
The deficit in the current draft budget amounted to 63.275 trillion dinars, with the adoption of a price of $70 per barrel of oil, according to what was sent by the Council of Ministers, given that more than 95 percent of budget revenues depend on oil sales.
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