...

Transfers Carried out to Budget from Difference Between Export and Internal Oil Prices Will Increase by Over 70% in 2009

Oil&Gas Materials 4 November 2008 15:32 (UTC +04:00)

Azerbaijan, Baku, 4 November / Trend , corr. I.Khalilova /The transfers by SOCAR (State Oil Company of Azerbaijan) into the state budget of the country from the difference between the contract (export) price and domestic wholesale pieces of 72.6% higher than projected in 2008,  is stated in the state budget forecasts for 2009-2012, which was submitted to the Parliament for consideration.

In 2009, a total of AZN 355.5mln is expected to be transferred to the state budget against AZN 206mln in 2008. The increase of assignments is expected due to growth of oil and gas production forecasts.

In Jan-Sept 2008, SOCAR had transferred AZN 171 877,600 to the state budget from the difference between the contract price and domestic wholesale price. Under the new mechanism, this was introduced within the correction of budget forecasts, 30% from this difference SOCAR transfers to the budget. Similar state will be retained in 2009. To 2008 the assignments touched 25%.

A total of AZN 40, 390,60 was transferred on the line in September, AZN 11,907,10 in August and AZN 4,007,10 in July.

The changes in the system the Finance Ministry explains by increase of incomes from the oil sector, as well as the world oil prices affect the volume of assignments. However, since October the oil prices have drop and touched $66 per barrel which is less than the price invested into the state budget in the amount of $70.

The state budget for 2008 envisaged transference of 75% oil incomes with exceeding the already existing $70 price (before the budget forecasts had been held at $50 price) to the State Oil Fund of Azerbaijan (SOFAZ). Before 2008, the mechanism envisaged the assignments with the oil prices at from $40 to $50. In this case 50% of additional assignments had been transferred to SOCAR. The next year budget forecasts are formed at $80. However, it is not excluded that the invested sum will be re-considered due to fluctuated oil prices.

According to the forecasts for 2008, the oil sector was to provide AZN 6.7bln incomes to the country's state budget (taking into account the transfers from SOFAZ in the amount of AZN3.8 billion), which made up 63.9 percent of total revenue. However, these calculations were carried out without taking into account the developments in Georgia and the explosion at the Turkish part of Baku-Tbilisi-Ceyhan pipeline that led to a decline in oil exports. In 2009, the transfers by SOFAZ are expected at AZN 7,595 billion rate (62.4%)

On 4 November, the official currency rate is 0,8097 AZN/USD.

The correspondent can be contacted at: [email protected]

Latest

Latest