IMF: Fiscal breakeven oil price to increase in Azerbaijan

By Azernews

By Rasana Gasimova

Fiscal breakeven oil price in Azerbaijan will amount to $52 per barrel in 2019 and in 2020 this figure will reach $53.4, according to forecasts of the International Monetary Fund (IMF).

This indicator amounted to $56 in 2018.

The breakeven price is the price mark at which financial losses and state profit converge and are in equilibrium.

The IMF expects an external breakeven oil price in Azerbaijan to reach $64 per barrel in 2019 and $59.5 per barrel in 2020; this is compared to $76.3 per barrel in 2018.

According to the IMF, Azerbaijan’s daily oil production in 2019 will amount to 0.74 million barrels (compared to 0.76 million barrels in 2018), and 0.73 million barrels in 2020. The daily oil export in 2019 will be 0.62 million barrels (0.63 million barrels in 2018), whereas in 2020 it will drop to 0.6 million barrels.

The state budget of Azerbaijan for 2019 envisages the oil price at $60 per barrel, and $55 for 2020.

Earlier, IMF reported that it believes that the high prices for oil and the increase in state investments favorably influence the economic growth of Azerbaijan.

The IMF also forecasted that Azerbaijan’s GDP growth will reach 2.5 percent in 2020-2024.

At the same time, the Fund expects a 2.5 percent growth in the oil sector in 2019. According to the forecast, in 2020-2024 it will reach 1.2 percent per year.

IMF’s document states that the nominal GDP of Azerbaijan will be $ 47.2billion in 2019, $48.2 billion in 2020, and $57.6 billion in 2024.

Based on the forecasts of the Fund, the average annual inflation in Azerbaijan will be 3.2 percent in 2019, 3.3 percent in 2020, and 3.5 percent in 2024.

IMF is an organization of 189 countries working to foster global monetary cooperation, secure financial stability, facilitate international trade, promote high employment and sustainable economic growth, and reduce poverty around the world.

Azerbaijan joined the Fund on September 18, 1992. The IMF's primary purpose is to ensure the stability of the international monetary system - the system of exchange rates and international payments that enables countries and their citizens to transact with each other.