Iraq will need an average oil price of over $92 per barrel to balance its national budget in 2025. According to the International Monetary Fund (IMF), Iraq’s fiscal breakeven price is estimated at $92.43 per barrel. This figure is crucial as it directly impacts the country’s financial stability.
Iraq is not the only country in OPEC with a high breakeven price. Iran requires the highest price, needing $124.12 per barrel. Algeria follows closely at $118.95 per barrel, while Kazakhstan needs $115.93. Saudi Arabia requires $90.94, and Kuwait needs $81.84. The UAE, however, has the lowest threshold, requiring only $49.95 per barrel.
The global oil market has seen a drop in prices in recent days. This decline is linked to concerns over new tariffs imposed by U.S. President Donald Trump on several trading partners. Additionally, a partial return of oil production by OPEC has raised concerns about oversupply in the market, which has also contributed to the price drop.
Despite these challenges, Iraq remains heavily reliant on oil revenue. The government must carefully manage its oil production and pricing strategies to meet its budgetary needs. The country’s ability to balance its budget hinges on these factors, and fluctuations in oil prices will have a significant impact on its economy in 2025.
To achieve fiscal balance, Iraq will need to focus on maximizing oil production and ensuring a stable price environment. This approach is vital to maintaining financial stability and supporting the country’s growth.
