Expert Proposes A Single Proposal To Confront The Decline In Oil Prices And Issues A Warning To Producing Countries
Baghdad Today - Baghdad Oil expert Haider Al-Batat warned oil-producing countries today, Monday (September 30, 2024), noting that shale oil production is more economically feasible.
Al-Batat said in an interview with Baghdad Today that "the rise in oil prices leads to a slowdown in industrial growth and a decrease in demand for oil, with an increase in the trend towards the use of alternative energy. This represents a threat to oil-exporting countries, and the main beneficiary of this situation is the United States of America."
He added, "US shale oil production is only economically viable when the price per barrel exceeds $65. If the price of oil falls below $65, US oil production becomes economically unviable."
He explained that "this will force America to reduce its production of shale oil, which will make the market need 10 million barrels of oil, and this will lead to an increase in demand for oil produced by OPEC member states to compensate for the gap resulting from the decline in American production."
The oil expert concluded by saying, “This scenario is the only solution to confront the decline in oil consumption and the shift to alternative energy.
It will also increase industrial growth, thus pushing oil-producing countries to increase oil production to keep pace with the increasing global demand. Thus, they compensate for the decline in price by increasing quantities.
This in turn increases the costs of using alternative energy, which is ultimately much higher than the price of fossil energy, leading consumers to turn away from it and continue to rely on fossil energy while developing and upgrading it to be environmentally friendly.”
According to the US Energy Information Administration, the United States has the largest recoverable resource of shale oil in the world, amounting to 78.2 billion barrels so far, followed by Russia with 74.6 billion barrels.
Although China is a relative newcomer to the scene, it holds a significant position with reserves of 32.2 billion barrels, contributing 7.7% of the global share.
Argentina, Libya and the United Arab Emirates also made the top ranks, indicating the diverse distribution of shale oil resources around the world. LINK
Internal And External Debts "Exhaust" The Iraqi Budget, And Experts Diagnose The Reasons
2024-09-30 06:37 Shafaq News/ The Iraqi government took a series of measures to reduce the external public debt from the financial surpluses achieved as a result of the rise in oil prices, and succeeded in reducing it. However, in return, the internal debt rose to exceed 70 trillion dinars to bridge the gap in financial liquidity and operating expenses.
Iraq continued to borrow externally after 2003, especially during the oil price collapse that coincided with security operations against ISIS in 2014, in addition to internal borrowing to cover the country's general budget deficit.
The International Monetary Fund said that Iraq's internal imbalances were exacerbated by the large financial expansion and the decline in oil prices, noting that Iraq needs to gradually correct the public finances to achieve debt stability in the medium term and rebuild financial reserves.
"Dead" Debts
Member of the Parliamentary Finance Committee, Jamal Kojer, said in an interview with Shafaq News Agency, "The external debt found in the reports available to us is a dead debt related to the Gulf War. These debts date back more than 30 years and countries do not demand them, so they are not real debts. If the Iraqi state demands their cancellation, they will be cancelled."
He points out that "the internal debt, which exceeds 70 trillion Iraqi dinars, is gradually increasing because the state's revenues are less than expenditures, and despite that, it is not a frightening debt."
According to official data, Iraq's internal debts amount to $50 billion, which are collected within the official and governmental financial apparatus, in addition to the existence of outstanding debts to eight countries, including Iran, Saudi Arabia, Qatar, the Emirates and Kuwait, amounting to $40 billion. These debts are questionable from Iraq's point of view and have not been written off, despite being subject to the Paris Club.
Low External Debt
In turn, the financial advisor to the Prime Minister, Mazhar Muhammad Salih, explained in an interview with Shafaq News Agency, that "Iraq is considered one of the countries with very little external debt, as the total debts due do not exceed 10 billion dollars, and these have annual allocations in the federal general budget to extinguish them, and they must be extinguished by 2028."
"The external debt is the remnants of the pre-1990 settlements," he added, noting that "Iraq is considered to have high creditworthiness according to the classification of international companies such as S&P Global Ratings and Fitch, and therefore the external debt does not exceed 5% of the gross domestic product compared to the international standard that accepts debts up to 60% of the gross domestic product."
Saleh points out that "there are internal debts amounting to 76 trillion dinars caused by two financial crises, the first of which was between 2014 and 2017, which was the war against ISIS terrorism and the decline in oil prices, and the second crisis was the Corona pandemic, which led to the closure of global markets and a significant decline in oil prices, and thus large borrowings occurred."
He stresses that "domestic debt generally does not exceed 30% of the gross domestic product and is a debt within the government and not between the government and individuals or the market, and there are mechanisms to extinguish it within the government's financial and banking system, and therefore there are no risks."
Debt Is Not The Perfect Solution.
However, the economic expert, Dhurgham Muhammad Ali, sees the opposite of what the financial advisor said, and says in an interview with Shafaq News Agency, "The internal debts also pose a danger because they must be paid and must not exceed 50% of the country's annual gross domestic product."
He added, "Expanding domestic borrowing is not the ideal solution to cover the budget deficit, but rather it is an easy way to cover the deficit using primitive but effective methods, as long as they do not exceed the required limit, especially in light of the decline in financial inclusion and the low rates of bank deposits for the Iraqi citizen compared to neighboring countries."
He explains that "combating corruption and following up on Iraq's money that has been swallowed by corruption over the past years is slow and ineffective and faces obstacles and challenges, and recovering this money could pay off many internal debts."
Hard Currency
For his part, economic expert Hilal Al-Taan confirmed, in an interview with Shafaq News Agency, that "the internal debts do not have a significant impact on the Iraqi economy, and most of them are in favor of the Ministry of Finance, the Central Bank, and other ministries."
He believes that "the major impact on the economy is on foreign debts because they are settled in hard currency, unlike domestic debts, which are settled in national currency. The state must first reduce foreign debts."
The largest part of the domestic debt is owed to the Central Bank of Iraq, the Rafidain and Rashid banks, and the Trade Bank of Iraq, which lent the government large sums of money to cover the federal budget deficit. LINK
Tues. 1 Oct. 2024 Currency Revaluation…Charlie Ward and Friends on Telegram
Key Currencies: Iraqi Dinar, Vietnamese Dong, and Zimbabwe ZIM
Iraqi Dinar: The Iraqi dinar has been undervalued for too long due to years of turmoil and economic instability. But everything is about to change. With this new treaty in place, the Dinar is set for a major revaluation—bringing newfound prosperity to Iraq and transforming its future.
This revaluation won’t just boost the economy; it will bring foreign investors flocking, pushing Iraq into a new era. The elites tried to suppress Iraq, but they can’t hold it down any longer. The rise is imminent, and those who know are getting ready to prosper.
Vietnamese Dong: Vietnam’s economy has been growing steadily, but the value of the Dong never reflected this progress—because they didn’t want it to. Now, with a revaluation, the Dong is set to be on par with the U.S. dollar, signaling the unstoppable rise of Vietnam’s economic power.
This isn’t just about Vietnam; it’s about a global shift, and the opportunities are endless. Trade, investment, and massive economic growth are on the horizon. Those in the know are already seeing the potential. Are you ready to seize the moment?
Zimbabwe ZIM: Zimbabwe has faced economic collapse, hyperinflation, and hardship—but the ZIM is coming back. The revaluation of the ZIM isn’t just a step forward; it’s a leap towards freedom from the chains the global powers placed on Zimbabwe.
This change will restore faith in Zimbabwe’s economy and pave the way for recovery and growth. The old system fears countries like Zimbabwe rising—but it’s too late to stop what’s coming. The revaluation is about reclaiming power, and those prepared will see rewards beyond belief.
Money and business Economy News – Baghdad [rtl]Advisor to the Prime Minister and Chairman of the Supreme Committee to Support the Iraqi Dinar, Qasim Al-Dhalimi, announced today, Tuesday, the committee’s success in restoring citizens’ confidence in the dinar, while pointing out that it has provided mechanisms to preserve the solidity of the dinar and the financial bloc.
Al-Dhalimi said, "The Supreme Committee for Supporting the Iraqi Dinar worked on how to restore the citizen's confidence in the dinar, and to make it the main link between him and the source of his money and how the citizen can connect the dinar to the solid Iraqi banks, and how to deal with it electronically," indicating that "the committee worked on many important joints."
He added that "the citizen wanted to know the extent of the interest of the government or private bank in dealing with depositing his money, and how to find real mechanisms to support the dinar by balancing it with other foreign currencies,"
noting that "there are mechanisms proposed by the committee for how electronic payment can be one of the features that preserve the solidity of the dinar, and preserve the financial mass present within the banks, and for the citizen to be the first and last beneficiary and the electronic organization process, so the committee sought to achieve financial security and stability in the government program." Views 62 10/01/2024 https://economy-news.net/content.php?id=48215
%209.24.10%E2%80%AFa.%C2%A0m..png)