Many key industry leaders now believe “the worst is over” for the global oil industry

By Pratap John
Chief Business Reporter

Qatar’s budget may not have slipped into a deficit in the last 18 months, as the average Qatari oil price was slightly higher than the budgeted average oil price for the period, data show.
The current financial year in Qatar is an extension of the fiscal 2014-15.
According to a data, Qatari oil price averaged $74.24 a barrel in 18 months from April, 2014 to September, 2015, although crude price has been on the decline since the middle of last year.
Data sourced from Reuters, Bloomberg and MEES showed the average oil price (Qatar’s crude) in nine months until December, 2014 stood at $94.35 a barrel.
And from January to September this year, the price had averaged $54.14.
The budgeted average oil price for the period is $65, which means the average Qatari oil price from April 2014 to September 2015, is higher.
The budgeted average oil price for the extended nine-month period (until December) will remain at $65 per barrel.
Earlier, the government had decided to extend the fiscal 2014-15 until December this year, prior to the “harmonisation of the financial year with the calendar year”, starting in January 2016.
Normally, the fiscal 2014-15 should have ended March this year.
Therefore, the period from April to December (nine months) will be considered an extension of the 2014-15 budget, and that the current fiscal year will cover a period of 21 months.
That said, the oil price in the last quarter of this year will determine whether the budget will indeed generate a surplus or not at the close of fiscal 2014-15.
In a recent report QNB said Qatar’s real GDP growth was projected to rise to 6.4% in both 2016 and 2017 as near-double-digit non-hydrocarbon growth will be supplemented by increased gas production from the Barzan project.
Growth in the Qatari economy accelerated in the second quarter of 2015. Real GDP grew by 4.8% year-on-year; QNB said quoting latest data released by the Ministry of Development Planning and Statistics (MDPS). The real GDP growth in 2014 stood at 4%.
Meanwhile, many key industry leaders believe “the worst is over” as far as the global oil industry is concerned.
HE the Minister of Energy and Industry Dr Mohamed bin Saleh al-Sada yesterday said the “oil price has bottomed out” as he saw signs of recovery for the oil industry in 2016 after a drastic down cycle.
The minister’s optimism was based on the latest projected key market fundamentals for 2015 and 2016.
As per this projection, world GDP growth in 2016 is slated to be 3.4% as against expected 3.1% in 2015, which would result in an increase in global oil demand by 1.3mn bpd to 1.5mn bpd.
Royal Dutch Shell CEO Ben van Beurden also said recently that oil markets were beginning to recover but the scale of global oversupply meant prices might rise only slowly.