Prime Minister’s Advisor: Iraq’s Budget Resilience Despite Global Oil Fluctuations…and the Crisis Is Temporary
Prime Minister’s Advisor: Iraq’s Budget Resilience Despite Global Oil Fluctuations…and the Crisis Is Temporary
2025-04-08
The Prime Minister’s Financial Advisor, Mazhar Mohammed Salih, confirmed on Tuesday that the Iraqi federal budget for the years 2023-2025 has been prepared according to a well-thought-out economic vision that takes into account the fluctuations in the oil market. He stressed that the decline in oil prices will not cast a shadow over the country’s internal economic situation. Salih explained, in a statement to the Center for Strategic Studies and Trade Policies at the Ministry of Trade, that there are clear indications that oil prices are entering a downward cycle, but this decline will not affect economic stability in Iraq, as the budget is built on realistic and precautionary foundations.
He pointed out that the reasons for this decline are due to several factors, most notably the deceleration of the Russian-Ukrainian conflict, Iran’s openness to negotiations with the United States, and the escalation of the trade war waged by Washington through the imposition of tariffs on global markets, despite the exclusion of the oil and gas sectors, which has negatively impacted oil markets and their contracts.
He explained that the current global crisis is a temporary one that will stabilize over the coming period, within the framework of global economic balances. He noted that the combination of positive geopolitical conditions and escalating global trade tensions could lead to a global economic shock that would reduce energy demand, particularly in light of a 1% decline in global growth and a 0.5% decline in demand for crude oil.
Saleh also noted that the oil market faces the threat of a supply surplus that could lead to further price declines in the coming years, as OPEC+ production returns to normal levels.
In concluding his remarks, the advisor emphasized the importance of the oil equation between China, a major oil importer, and the United States, a major global producer. He believed that maintaining stable oil prices represents a strategic interest for both parties and contributes to the stability of the global market as a whole.
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