Re: Nagorno-Karabagh: Military Balance Between Armenia & Azerbaijan
The Oil falling is more important than any military, political, economic development out there. It could be the biggest development for our nations well being. I think the IMF prediction was made before most recent, more extreme decline. In October, the Azeris had to adjust their 2015 budget from oil being based on $100/barrel to $90. Well now the price of Brent is $70/Barrel. Despite the various attempts at manipulating numbers such as saying "oil only account for 45% of economy", or "non-energy sector growing", the bottom undeniable fact is oil accounts for about 74% of all government revenue. http://www.academia.edu/8149729/Why_...an_in_English_
Given the fact that year-to-year oil prices are down roughly 33% and that oil account for 74% of the economy, Azerbaijan will be receiving 25% less revenue in the upcoming year. That's 9 billion dollars. They can't cut the budget because it will cause panic and mass civil unrest. So they'll have to tap into their SOCAR Oil Fund which officially stand under 30 billion dollars, but most likely significantly less. When this fund runs out is when real instability will start. But let's just say if prices stay where they are for the next 12 months (which most predictions says they will), Azerbaijan won't be talking as big.
Originally posted by ArmeniaSacra
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Given the fact that year-to-year oil prices are down roughly 33% and that oil account for 74% of the economy, Azerbaijan will be receiving 25% less revenue in the upcoming year. That's 9 billion dollars. They can't cut the budget because it will cause panic and mass civil unrest. So they'll have to tap into their SOCAR Oil Fund which officially stand under 30 billion dollars, but most likely significantly less. When this fund runs out is when real instability will start. But let's just say if prices stay where they are for the next 12 months (which most predictions says they will), Azerbaijan won't be talking as big.
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