Mazhar Muhammad Saleh, the Prime Minister’s financial advisor, confirmed on Saturday that the rise in global oil prices reduces the federal budget’s hypothetical deficit.
“The oil markets indicate a tangible rise 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 by 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,” Saleh said in a statement to the official agency.
“What matters is that the average price of exported oil during the fiscal year exceeds the budgeted default price for a barrel of Iraqi exported oil, which is 70 US dollars,” he said. As a result, any sales that surpass the aforementioned default price will surely contribute to closing the gap in the hypothetical deficit in an obvious inverse connection.”
“We believe that the budget for the next two years will maintain its constants and preventive and precautionary measures regarding the development of prices in the oil markets and its relationship to the hypothetical deficit, especially for 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 indicate its continuation, and that the OPEC Plus group is also continuing,” he added.