Azerbaijan plans to narrow its budget deficit next year as the government projects rising oil revenue as crude prices rise and output stabilizes.
The government targets a shortfall of 656 million manat ($836 million), or 1.17 percent of gross domestic product, Finance Minister Samir Sharifov told parliament yesterday. That’s down 0.1 percentage point from this year’s plan, according to the ministry.
The Caspian Sea nation is the third-biggest energy producer in the former Soviet Union, with Russia and Turkey as its biggest export markets. Companies led by London-based BP Plc have invested about $33 billion in the country’s oil and gas fields since 1994.
The government forecasts a 12.4 percent increase in revenue next year, with about 60 percent coming from the state oil fund, or Sofaz, which manages income from energy sales. The average price of oil is forecast at $100 a barrel. Spending is predicted to rise 12.1.
Oil production fell 7.1 percent to 22.2 million metric tons in the first half after the country’s largest oilfield of Azeri-Chirag-Guneshli, or ACG, cut output 12 percent, the State Oil Co. of Azerbaijan, also known as Socar, said in July.
The BP Plc-led field is expected to keep output stable at 33 million tons next year after the decline drew criticism from the country’s President Ilham Aliyev last month, Socar said.