20-month low oil disrupts Iraq budget

12 November 2008

Iraq, one of the world's top oil exporters, has been forced to review its 2009 draft budget because it did not account for such low oil prices, it has emerged.

Barham Salih, the country's deputy prime minister, told Reuters the budget had been based on oil prices averaging $80 (£52) per barrel but since the economic slowdown has caused prices to drop to a 20-month low, the draft must now be amended.

He added: "We are also proposing a supplementary budget early next year, hoping that by then the uncertainties will have been alleviated."

Iraq will work to supplement the budget with some of the surplus gained from the soaring prices in the summer of this year which reached $147 per barrel.

Meanwhile, news that the cost of oil has dropped again today should be welcomed by home heating oil customers and drivers around the world who could be the only ones who stand to benefit in the foreseeable future.

US crude has fallen to $58.77 per barrel while Brent crude is more than three dollars cheaper at $55.21.

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