"Undoubtedly, any forecast can be subject to certain risks. Therefore, I would like to mention that when preparing the draft state budget, the Ministry of Finance relied on the macroeconomic forecasts prepared by the Ministry of Economy. As we know, there are three scenarios for the forecast of oil prices: the optimistic, baseline, and pessimistic scenarios. Our budget forecasts are based on the baseline scenario. In the baseline scenario, the price of oil is assumed to be $70. In the pessimistic scenario, this price is set at $60," Minister of Finance Samir Sharifov said during a joint meeting of the Parliamentary Committees on Youth and Sports, Public Associations and Religious Entities, and Culture when discussing the "Draft Law on the State Budget of the Republic of Azerbaijan for 2025," APA reports.
He also noted that if oil prices decline, the State Tax Service anticipates a decrease of AZN 340 million in budget revenues: "However, this is not a significant blow. As for the revenues of the State Oil Fund, the impact is higher. We are talking about an effect of AZN 2.1 billion."
"In the current year's budget, we increased the oil price forecast from $60 to $75. For next year, however, we have reduced the price by $5. If oil prices decrease, we have reserve measures in place to mitigate these negative impacts."
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