Oil Fund’s funds do not melt so fast anymore: government switched to “saving” regime

During 9 months, 2015 incomes of the State Oil Fund of Azerbaijan (SOFAZ) totaled 5,543,400,000 AZN. During the same period last year incomes of the Fund totaled 10,131,009,000 AZN. Therefore, during 9 months, 2015 SOFAZ’s incomes decreased by 4,588,500,000 AZN or by 45.3%.

SOFAZ’s incomes from sale of profitable oil and gas of the state totaled 5,479,500,000 AZN. From January to September 2014 this index totaled 9,947,800,000 AZN (reduction by 44.9%).

During 9 months, 2015 SOFAZ’s costs totaled 6,397,100,000 AZN. From January to September 2014 SOFAZ’s costs totaled 8,041,200,000 AZN. Therefore, SOFAZ’s budgetary costs during this period decreased by 1,644,100,000 AZN or by 20.4%.

However, during 9 months SOFAZ’s budget had a deficit of 853.7 million AZN against the proficit of 2,090,700,000 AZN during the same period last year.

By October 1, 2015 assets of SOFAZ totaled $34,783,100,000, dropped by $2,567,200,000 during a year. However, the Fund’s resources decreased by 2.36% against early this year (by 01.01.15 they totaled $37,104,100,000).

In 2016 the government expects that SOFAZ is going to have a deficit with the average export oil price of $50.00 per barre. SOFAZ’s incomes are forecast to be 6,711,600,000 AZN, while expenses – 8.2 billion AZN. The deficit is expected to reach $1,488,400,000.

If the government’s forecasts next year are true, then by early 2017 SOFAZ’s assets must total about $32.5 billion.