Kuwait expects surplus budget

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KUWAIT CITY, Oct 29: Positive indicators still dominate the performance of the state’s general budget despite the decline in oil prices from more than $120 per barrel to the level of $92 per barrel. It is 37.5% more than the break-even price in the 2022/2023 budget, reports Al-Anba daily. According to statistics prepared by the daily, based on the announced oil prices since the beginning of the current fiscal year, the average value of the increase in the price of each barrel of oil sold since the beginning of the current fiscal year is estimated at about $29.6 per barrel, which means that every barrel of oil sold added a surplus in the budget the same value.

The statistics revealed that the total oil revenues achieved by Kuwait from last April to this October was about 19.4 billion dinars, while the average volume of state expenditures during the same period was about 13.65 billion dinars, which means that Kuwait achieved a budget surplus during the first 7 months. From the year, it is estimated at 5.75 billion dinars, based on the volume of total state expenditures estimated at 23.1 billion dinars for the whole year, and the average volume of oil production is 2.8 million barrels per day, with an average price of a dollar at 304 fils.

According to a simple calculation, and according to what was announced by the Parliamentary Finance Committee in the previous National Assembly, the increase in the price of a barrel of Kuwaiti oil above the equivalent price in dollars achieved budget savings estimated at 333 million dinars, which is the same as the size of the estimated savings in the draft general budget for the current fiscal year at an estimated price.

At $80 per barrel, the increase in the price of Kuwaiti oil, estimated at $29.6, secures the total budget surplus of 9.85 billion dinars, a figure that is nominated for increase and decrease according to 3 main variables — any change in oil prices, up or down, during the remaining 5 months of the fiscal year will mainly affect the performance of the budget, as the increase in prices will naturally increase the size of the surplus, and its decrease will reduce it.

Two, any change in OPEC’s policies in terms of global production volume and Kuwait’s share of decisions to reduce or increase it has the same effect, either increasing or decreasing revenues and three, if the government and the National Assembly approve any additional expenditures, the difference between revenues and expenditures will increase, and the surplus will be reduced by the same value as the new additional expenditures.

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