Azernews.Az

The Azerbaijani government has increased its oil price forecast from $80 to $100 a barrel for 2013 amid the global developments and volatility in world crude prices. The projections on next year's state budget and consolidated budget have been drawn up on its basis, officials told Trend news agency.

At present, indices of the state budget for 2013 are being adjusted according to the revised oil price forecast.

The budget package for 2013 and the next three years will be submitted to parliament by October 15.

The Economic Development Ministry initially set the oil price at $80 in its macroeconomic forecast for next year. However, it has now revised up the projection considering that the price on Azeri Light crude oil produced at the Azeri-Chirag-Gunashli (ACG) block of fields in the Caspian Sea exceeds $100 a barrel in world markets.

On October 8, the price of AZERI LT CIF Augusta was $113.88 per barrel, or $0.28 per barrel over the previous price, according to the Azerbaijani state oil company SOCAR, which has produced light oil since 1997.

Azeri Light oil, produced from the BP-operated ACG fields, is directly delivered to the Turkish port of Ceyhan via the Baku-Tbilisi-Ceyhan main export pipeline, and to the Georgian port of Supsa via the Baku-Supsa pipeline.

AZERI LT FOB Ceyhan oil price was $113.13 per barrel on October 8, or $0.28 more than the previous price.

Azerbaijan exports URALS oil from the Russian Black Sea port of Novorossiysk which is then delivered via the Baku-Novorossiysk northern route pipeline.

The price of URALS (EX-NOVO) was $110.14 per barrel on October 8, or $0.35 per barrel above the previous price.

The price of Brent Dated, produced from the North Sea, was $112.49 per barrel, an increase of $0.21 per barrel.

Despite the rise in oil prices, Azerbaijan continues to pursue a conservative policy and is not seeking to significantly increase the prices while forecasting budgetary indices.

The country's government has already earned about $76 billion from oil sale, of which about 45 percent has been retained in a fund for future generations, and the remaining funds were used by the government for the current needs.

The government expects oil production to grow in 2013.

"Oil production in Azerbaijan declined in 2011 and 2012 but it will increase in 2013," a source in the government said. "The increase in oil production will continue in 2014. This is linked to the completion of repair work and the construction of new wells."