For the Iranian regime to end the calendar year without a budget deficit the oil prices need to reach about $125 per barrel, an Iranian economist said on Friday.
“If the government plans to end the year avoiding deficit according to the figures anticipated in the budget, it must be able to sell oil for at least $125 per barrel,” according to an interview published on the Iranian Oil Ministry’s website.
Oil prices continued falling on Friday as evidence mounted that the increase in American oil production would continue well into 2015 even while growth in global demand was declining, according to the New York Times.
The global benchmark for crude approached $60 a barrel – down more than 3 percent on the day and roughly 45 percent since the summer, the report said.
The American benchmark also continued to free fall – to below $58 a barrel, down around 4 percent. A day earlier it sagged below $60 a barrel in the United States for the first time since 2009.
Analysts say a major cut in global production would be needed next year in order to avoid an inventory buildup and to stabilize falling prices. But the prospect of a supply cut was dashed last month when the Organization of the Petroleum Exporting Countries declined to change its output ceilings at a meeting in Vienna.
Economic experts believe that after the fall of oil prices on the world market, oil revenues of Iran could be reduced to $26 billion in 2015.
Iranian oil was once being sold for $100 to $110 a barrel. Now the price has been reduced to $70 a barrel.
With this sudden drop in oil prices, oil revenues of the clerical regime will fall by 30% next year.