A $5–20 change in oil prices above or below the baseline forecast may impact the balance of Azerbaijan's consolidated budget and the assets of the State Oil Fund of Azerbaijan (SOFAZ), Report informs citing the Medium-Term Expenditure Framework for 2027–2030 prepared by the Ministry of Finance.
According to the baseline scenario, SOFAZ assets will reach $73.9 billion by 2030. Depending on oil price fluctuations, they may differ from the baseline figure by approximately $0.9–1.8 billion.
In 2027, the consolidated budget balance-to-GDP ratio in the baseline scenario is projected at minus 2%. In alternative scenarios, this indicator may differ by 1.4–2.7 percentage points.
The document notes that the significant share of the oil and gas sector in state budget revenues and exports makes changes in prices and production volumes key factors influencing budgetary and macroeconomic indicators. A decline in oil prices relative to the forecast may lead to a reduction in oil and gas revenues, a deterioration in the consolidated budget balance, and a decrease in SOFAZ assets.
At the same time, the probability of oil prices falling below $65 per barrel next year is assessed as low, while fiscal risks associated with oil price changes are considered limited.