Azerbaijan continues to employ a sustainable, robust, and conservative approach to forecasting oil prices, a strategy that is yielding clear economic benefits for the country this year. This was stated by Finance Minister Samir Sharifov during a session of the Milli Majlis (National Assembly) Committee on Economic Policy, Industry, and Entrepreneurship, which focused on the draft law regarding the execution of the 2025 state budget.
According to the Operative Information Center-OMM, the Minister highlighted the effectiveness of current fiscal policies. "Looking at our revenue forecasts, the execution rate stands at 102.2%, meaning state budget revenues were exceeded by 2.2%. In the non-oil and gas sector, this figure reached 101.6%," Sharifov noted. He emphasized that oil and gas revenues remain heavily dependent on global market volatility, which necessitates a cautious planning approach.
Addressing the debate over budget benchmarks, the Minister recalled that while some deputies previously suggested lower price targets, the government's conservative estimates have proven accurate. "For the previous year, the set figure was 70 USD per barrel, and the actual execution was 71 USD. This reflects the specific nature of the policy Azerbaijan implements," he added. Regarding the current year, Sharifov explained that setting the budget oil price at 65 USD is a deliberate, conservative measure. While market prices may exceed this, the government prioritizes fiscal stability, directing additional revenues into the State Oil Fund of the Republic of Azerbaijan (SOFAZ) to ensure long-term economic security.
The state budget of Azerbaijan is a critical instrument for the country's macroeconomic stability. By utilizing conservative oil price projections, the government mitigates the risks associated with global commodity price fluctuations, ensuring that essential public services and infrastructure projects remain funded even during periods of market instability.
