Iraq’s 2012 Budget Forecast Based on $80 Oil
Posted on 10 November 2011.
Azzaman news agency reports that the Iraqi Central Bank’s budget forecast for 2012 is based on and oil price of $80 per barrel.
Muatasem Akram, a consultant with the bank, said the forecast was reasonable, though much below the 2012 forecasts for oil prices on international markets.
He acknowledged the bank’s budgetary estimates for oil earnings were relatively low and may lead to a revenue deficit, but said it was better to adopt predictions that were easy to achieve rather than basing the country’s budget on forecasts that may not come true.
“We expect the 2012 deficit to be met by additional exports and firmer oil prices,” he said.
More than 90% of Iraq’s hard cash earnings are generated by oil exports.
Akram said the budget was based on an average export level of 2.6 million barrels a day.
He said the Central Bank adopted what it believed to be a low export figure to ensure that the development plans in the budget were achievable.
The Central Bank, he said, was aware of assurances by the Ministry of Oil of a substantial hike in oil exports in 2012.
But he said given OPEC forecasts that world oil consumption will remain stable in 2012, the bank settled on the current oil production rates and export figures.
"Truth is everlasting, but our ideas about truth are changeable. Only a little of the first fruits of wisdom, only a few fragments of the boundless heights and depths of truth, have I been able to gather"