Azerbaijan Oil Fund Lost $ 2.3 million US in light of the Ukraine Crisis

Azerbaijan Oil Fund Lost $ 2.3 million US in light of the Ukraine Crisis

The State Oil Fund of Azerbaijan (SOFAZ) suffered investment losses due to the events that took place in Ukraine. According to SOFAZ, budget revenues of the State Oil Fund of Azerbaijan (SOFAZ) for the period of January-March, 2014 reached 3.005 billion manat ($ 3.85 billion US), while budget expenditures constituted 2.443 billion manat ($ 3.13 billion US) meaning that the budget was implemented with actual surplus of AZN 561.7 million ($ 720 million US).

As per January-March 2014 budget of the Fund, 2.342 billion manat ($ 3.002 billion US) were transferred to the state budget. The expenditures in the amount of 70.1 million manat ($ 89.9 million US) were directed to financing the improvement of social-economic condition of refugees and internally displaced persons, 5.6 million manat ($ 7.17 million US) were used for financing the reconstruction of the Samur-Absheron irrigation system. 5.1 million manat ($ 6.53 million US) were directed to financing Baku-Tbilisi-Kars railway construction and 3.0 million manat ($ 3.84 million US) were directed to financing “The state program on the education of Azerbaijan youth abroad in the years 2007-2015”. The Fund’s administrative and operational expenses for the reporting period were 16.9 million manat ($ 21.66 million US).

During the first quarter of the year, the value of SOFAZ’s equity portfolio decreased due to the Ukraine Crisis. Despite the income from different investments the losses from managing assets of the Fund for January-March 2014 amounted to 1.8 million manat ($ 2.30 million US). In the following months as a result of stabilization and growth in the prices of equities of Russian companies, revenues from managing assets of the Fund for the period January – May 15, 2014 totaled to 87.8 million manat ($ 112.56 million US).

The Fund’s extra-budgetary revenues related to the revaluation of foreign exchange totaled 10.1 million manat ($ 12.94 million US). SOFAZ’s extra-budgetary revenues related to price changes of gold amounted to 60.8 million manat ($ 77.94 million US)while extra-budgetary expenses related to price changes of USD, EURO, GBP and other currencies totaled 50.7 million manat ($ 65.0 million US) .

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