Shahmar Movsumov: “Low oil price means decline of SOFAZ assets by $3 bln”

Shahmar Movsumov: “Low oil price means decline of SOFAZ assets by $3 bln”
# 26 January 2015 08:42 (UTC +04:00)

Baku. Musa Ahmadov, Yegane Lachinzade - APA-Economics. Low oil price means decline of SOFAZ assets by $3 bln, Executive Director of the State Oil Fund of Azerbaijan (SOFAZ) Shahmar Movsumov said.

According to him, eh raw material prices will probably be stabilized in the second half of 2015: “It’s clear that no one expects rebound of these prices as in 2009-2010, however it will exceed the current level”.

Though economic development weakened due to oil price decline, Azerbaijan could keep its exchange rate: “GDP growth made 2.8% in 2014 in connection with decline of oil production over 2%, while it was 5.8% in 2013. Central Bank spent $1.13 bln from its financial resources to keep exchange rate of manat stable in December”.

Movsumov noted that if the oil price makes about $90 a barrel this year, the Fund will earn AZN 10.3 bln. According to him, Fund’s expenditures are expected to be AZN 11.8 bln, of which 88% will be transferred to the state budget.

SOFAZ will allocate AZN 997 mln for financing of Azerbaijan part of Southern Gas Corridor designed for transportation of natural gas to Europe through Azerbaijan, Georgia, Turkey, Greece and Albania from 2019.

“We’ll be able to protect our currency. Though our costs will be reduced, we’ll realize it without any damage to economy”, Movsumov said.

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