International Oil Prices Deterioration Effects Iraq

Oil prices are detracting globally and this will reflect negatively on the Iraqi national budget leading to more hard times to the Iraqi government and people.

 The decline of oil prices on an international level reached about 20%, which puts Iraq on the top list of the effected countries with this deterioration.

The security situation was also a main factor in the reduction of Iraq's income due to the decrease in its oil exports by one million barrel per day.

Depending almost solely on oil revenue, Iraq's 2014 National Budget, which hasn't been passed yet by the council of representatives due to political conflicts, was built on the bases of $90.00 per barrel. Which requires an extensive increase in oil production and exports to compensate.

Countries producing Shale Oil are not helping with the Iraqi financial crises, they also contributing in the world oil Prices deterioration effects Iraq directly by the reducing demand on crude oil produced in the country and Gulf States in general.

Iraq has lost $12 billion in the last 4 months because of its bad policies in building its budgets, setting 93% of its base on oil exports.

Iraq has to take dramatic measures to decrease the possibility of a Fiscal deficit in future budgets, through reducing dependency on oil as a sole revenue, encouraging other sectors like agriculture, industry and tourism both recreational and religious.

Kadhum A. Jabbar

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