National Budget Group: By 2021, oil production in Azerbaijan is to reduce by more than 3 times
Oil production in Azerbaijan will be reduced each year and will reach to 25 million barrels in 2029. In the same time the oil production in the country reached the peak in 2010, when 450 million barrels was produced, and since then the volumes of production are declining, reads Azerbaijan’s National Budget Group (NBG) report, "Factheber” portal reports.
According to the table presented by the National Budget Group oil production in Azerbaijan will be reduced to 250 million barrels in 2015, from the 360 million barrels that is produced in the current year. Further the decline in oil production will rise: there will be 175 million barrels in 2018, 100 million barrels in 2021 and 25 million in 2029. That is to say, by 2021, the oil production in Azerbaijan will be reduced by more than 3 times.
As stated in the material, the amount of oil revenues in Azerbaijan in 2009 will fall to the level of performance that was in 2003. It is also noted that a few years ago, the BP predicted peak level of oil revenues by 2011.
"These predictions came true. However, given the excessive increase of annual expenditure of the Azerbaijani government, it is easy to predict the fate of the country in 2029. It’s interesting, the government of Azerbaijan, that increases its main and current expenditures due to oil revenues, on account of which revenues will cover the expenses of 2029? It is also necessary to take into account the fact that the level of non-oil sector in the country leaves much to be desired," the material states.
Oil volume in Azerbaijan has started to decline since 2011. While around 50,8 million tons of oil was pumped in 2010, the volume was reduced to 10.8% and 45,4 million tons in 2011. The volume of oil production declined to 5,3% and 43 million tons in 2012. Another 2,2% decrease was recorded during the five months of 2013. Another 1.6% reduction was recorded during the six months of 2013.
By a decline in oil production the dependence of the economy and budget of Azerbaijan on the oil sector is growing. Thus, the transfer share of the State Oil Fund of Azerbaijan in the countries state budget revenues is growing since 2007, when the transfer of SOFAR was less than 9% of budget revenues, and in 2013 it is planned that the transfer will make 59.3% of the revenues of the state budget. Overall, in 2013, Azerbaijan's state budget revenues from the oil sector will make over 79% of total revenues.
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