Iraq Economic News and Points to Ponder Wednesday Afternoon 4-2-25
Government Advisor: The 2025 Budget Includes Significant Adjustments In Spending And Deficit.
Time: 2025/04/02 {Economic: Al Furat News} The Prime Minister's advisor for financial affairs, Mazhar Mohammed Saleh, confirmed that "the general budget amendments enhance stability and support the country's urban renaissance."
Saleh told Al Furat News Agency that: "The financial and legal flexibility available in the Federal General Budget Law No. 13 of 2023 (the three-year budget), in accordance with the implementation of the amended Financial Management Law No. 6 of 2019, has allowed the executive authority to proceed with the implementation of its government service program for ongoing projects without interruption and at a high level of stability."
He explained that "these efforts have been clearly reflected in all governorates of the country, as they are witnessing a continuous and organized urban renaissance." He pointed out that the financial tables for the year 2025 will soon be submitted to the Council of Representatives in accordance with Article 77/Second of the Three-Year Budget Law, which will include some important adjustments in spending, sources of public revenue, and deficit management."
He pointed out that these adjustments come after the Council of Representatives approved, in early February of the month before last, the amendment to Article 12 of the Budget Law, related to the mechanisms for calculating the extraction of oil from the Kurdistan Region in the areas of extraction and transportation operations.
The Financial Advisor emphasized that the financial track is proceeding regularly and effectively, with a high level of governance, transparency, and financial integrity, thanks to close coordination between the legislative and executive authorities. LINK
Government Statement On Iraq's Foreign Reserves: At Their Highest Levels
Money and Business Economy News – Baghdad The Prime Minister's financial advisor, Mazhar Mohammed Saleh, confirmed on Wednesday that foreign reserves are at their highest historical levels, helping to achieve economic balance and stability for the country. He also noted that reserves still cover more than 100% of the currency in circulation.
“The slight decline in the Central Bank’s reserves, estimated at 1% of the country’s total foreign reserves, is linked to two things: First, the high level of reinforcements of the Iraqi banking system with foreign currency from their correspondents abroad for the purposes of financing trade and external transfers, which led to a significant decline in the exchange rate of the dollar in the parallel market against the dinar and an increase in the value of the dinar in that parallel market,” Saleh told the official agency, as followed by “Al-Eqtisad News.”
He explained that "control over domestic liquidity levels has become high, significant, and influential in light of the increasing external value of the dinar, which continues to indicate a decline in the effectiveness of the parallel or secondary market in the country.
There has also been a very clear decline in growth rates in the general price level and a very high level of price stability, unlike anything the country has ever witnessed before."
He added, "The other issue depends on the degree of growth in the amounts in which the public finances exchange monthly oil revenues in foreign currency for the dinar for the benefit of total spending (which is the basis of foreign reserves) and converting them into Iraqi dinars,"
noting that "this is also linked to the degree of discipline and control of public expenditures on the one hand, and thus the slowdown in the liquidation of government foreign currency proceeds into domestic liquidity that can be spent on the other hand through the general budget."
He pointed out that "taking into account the risks of fluctuations in average export oil prices of about $70 or less per barrel in energy markets, which occurred in recent months, this means that the compatibility between the level of replenishment of foreign reserves (through collecting them through cash issuance), which may have become slower and less rapid on the part of public finance, and external transfers in foreign currency for the benefit of financing private sector trade on the part of the monetary authority, which is still at a relatively high pace, is what caused this deficiency or slight decline in foreign reserves."
Saleh continued, "Foreign reserves remain at their highest historical levels, achieving economic balance and stability for the country. The function of foreign reserves remains to defend price stability. However, it is also wise for the Central Bank of Iraq to closely monitor the movements of the current account of the balance of payments to maintain the stability of foreign reserves and monitor their growth safely."
He stressed that "these foreign reserves still cover more than 100% of the currency in circulation and enjoy a high commercial efficiency of more than 15 months of imports, compared to the global standard of three months."
He added that "the monetary authority is the only competent entity responsible for managing the country's monetary policy at the domestic and external levels, with a high degree of consensus in terms of balance and transparency to achieve and maintain economic stability." https://economy-news.net/content.php?id=54025
An Iraqi Oil Field With Reserves Of 22 Billion Barrels Has Been Awarded A New Contract.
Energy Economy News – Baghdad An Iraqi oil field with recoverable reserves of approximately 22 billion barrels has been awarded a new contract to provide full project management services.
China Huanqiu Engineering & Construction Corporation (HQC) has signed a contract to provide project management services for the West Qurna 1 oil field in Iraq.
The West Qurna 1 field, located in Iraq's Basra Governorate, is one of the largest oil fields in Iraq, with recoverable reserves of approximately 22 billion barrels.
The field's proven reserves are estimated at more than 12 billion barrels, according to a statement posted by the Chinese company on the social media platform WeChat.
West Qurna Oil Field Production
Since CNPC took over as prime contractor from ExxonMobil on January 1, 2024, the West Qurna field has maintained an average production of over 541,000 barrels per day of crude oil throughout the year.
Production reached a record high of 568,000 barrels per day on July 28 of last year (2024), according to Huanqiu Engineering and Contracting Company.
On January 22, 2025, the signing ceremony for the West Qurna-1 oilfield water injection project was successfully held at the headquarters of China Petroleum Engineering and Construction Corporation (CPECC).
This project is the largest engineering, procurement, and construction (EPC) contract since the company assumed the role of prime contractor for the West Qurna 1 oil field project, according to a statement seen by Energy Platform.
This initiative introduces advanced high-pressure water injection technology, using the latest water treatment and reinjection systems, to maintain optimal reservoir pressure and enhance production efficiency.
The implementation strategy consists of two phases, focusing on upgrading existing facilities and establishing new water injection infrastructure. The completed facility will significantly increase water injection capacity from 300,000 barrels per day to 1.5 million barrels.
Iraqi Oil Field Developments
On January 1, 2025, China National Petroleum Corporation (CNPC) held a groundbreaking ceremony for the new operations headquarters for the West Qurna 1 project in Basra, Iraq's second-largest city and a major port.
Oil Minister Hayan Abdul-Ghani announced via video link that the field's production has now reached 550,000 barrels per day, praising the Chinese company for providing job opportunities and adequate services to local communities.
The new complex extends over an area of 800,000 square meters, with a total construction area of approximately 50,000 square meters. It is scheduled for completion in two phases, the first in 2027 and the second in 2028.
The first phase will accommodate 540 employees and include two production command buildings, a restaurant, a multi-purpose building, a medical clinic, a maintenance workshop, and other support facilities.
Laying the foundation stone for the new operations headquarters for the West Qurna oil field project - Photo from the China Daily platform
In a press release reviewed by Energy Platform, the China National Petroleum Corporation announced that it had successfully completed the handover of seven fields within six months, with all fields fully delivered.
By last year (2024), average annual production had risen to 541,000 barrels per day, and production stabilized at 550,000 barrels per day, reaching a record peak of 568,000 barrels on July 28, 2024.
In 2025, the successive operation of four major projects will contribute to increasing production capacity by 200,000 barrels per day.
"We expect production capacity to reach 800,000 barrels per day by 2028, 1 million barrels per day by 2030, and in the next phase, 1.2 million barrels per day by 2035," said project manager Kai Kai Ping https://economy-news.net/content.php?id=54033
New Rise In Basra Crude Prices
Wednesday, April 2, 2025 | Economic Number of reads: 209 Baghdad / NINA / The prices of Basra heavy and medium crude oil rose on Wednesday, with the stability of oil prices in global markets.
The prices of Basra heavy crude rose 76 cents, or 1.07%, to reach $72.04, and the prices of medium crude rose 76 cents to reach $75.09.
Oil prices stabilized before Trump imposed new tariffs that could deepen the global trade pocket.
Brent crude recorded $74.60, up 10 cents, and US crude recorded $71.26, up 3 cents. / End
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