The main goal of the study is to assess how oil price decline in the world market will potentially impact Azerbaijani Economic. The paper specifically looks how last changes in the world market will effect on both revenue and expenditure sides of the state budget. The study also examines “side impact” and “domino effects” of low oil prices.
As an oil exporter country Azerbaijan might face the effects of a sharp fall in oil revenue after oil price decline in the world market. Azerbaijan is heavily dependent on oil and natural gas export revenues. In 2013, Azerbaijan hydrocarbon exports revenues accounted for 95% of the country’s total export revenues, and 64 % of total fiscal revenues.
In public finance part, the paper particularly deals oil price decline’s impacts on the 2105 State Budget of Azerbaijan Republic. The study calculates how every $1 per barrel drop in the price of “Azerlight” results annual revenue loss, including losses of GDP, normal export levels and country’ budget.
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