Azernews.Az

By Nigar Abbasova

The volume of revenues of Azerbaijan’s oil fund SOFAZ is expected to exceed the forecasted indices for 2016.

Head of the Fund Shahmar Movsumov said that the expectation is linked to the fact that initially the budget of the Fund was based on the oil price standing at a low level.

“In early 2016, the budget of the Fund was based on oil price standing at $25 per barrel. The average oil price stabilized during the year and exceeded the level of $42 per barrel. Therefore, the revenue of SOFAZ is expected to exceed the forecast significantly,” Movsumov clarified.

Revenues of the SOFAZ budget are approved at the level of 4.58 billion manats ($ 2.61 billion), while expenditures stand at 10.67 billion ($ 6.08 billion). The budget deficit is forecasted at 6.09 billion manats ($ 3.47 billion).

Movsumov further commented on the existence of the manat [national currency] in the assets of the Fund, saying that the existence of such aggregates is due to the low need for manat reserves in the state budget and the fact that the demand for such reserves does not have a regular character.

“The Fund continues the sale of the currency at auctions in accordance with the schedule. We hope, that all reserves will be generated to the budget till late 2016,” he said.

SOFAZ’s transfers to the 2016 budget are forecasted to stand at 7.6 billion manats ($4.3 billion), while the index for 2017 is forecasted at 6.1 billion manat ($3.4 billion). A balanced budget, with oil prices standing at $40 per barrel taken as a basis, will be effective in 2017.

Assets of the Fund as of October 1 stood at $35.82 billion, with some $33.95 billion accounting for the investment portfolio and 1.87 billion falling to a share of manat account. The Fund plans to increase its assets by $1 billion in 2017.

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Nigar Abbasova is AzerNews’ staff journalist, follow her on Twitter: @nigyar_abbasova

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