ING Group: Azerbaijan maintains financial stability despite oil price shifts

State financing in Azerbaijan remains stable, with the average price of oil standing at $64 per barrel, in line with the averages of the last decade, according to a report from Netherlands' ING Group.

Thus, forecasts suggest that the price of Brent crude oil required for Azerbaijan's fiscal break-even point will be $66 per barrel in 2024 and rise to $68 per barrel by 2026, Caliber.Az reports per local media.

Azerbaijan's consolidated budget surplus is projected to reach 4% of GDP in 2024. However, it is expected to decline to 1.7% in 2025 and further to 0.4% by 2026.

ING experts note that a $1 fluctuation in the price of Brent oil, while impacting annual fuel revenues, remains within an acceptable limit of $183 million.

Despite a reduction in oil production, the Azerbaijani government maintains financial stability and possesses sufficient resources to meet rising social, military, and investment needs. However, this trend could lead to a reduction in the consolidated budget surplus to zero by 2026.

Nevertheless, this is expected to foster overall economic growth, particularly in the non-oil sectors.

By Aghakazim Guliyev