São Paulo – Libya’s Parliament has decided this Wednesday (20th) to appoint a commission to analyse the Libyan Central Bank’s request to revise the budget for 2014. The monetary authority has submitted the request via a memorandum, due to the decline in oil revenues, according to an article published by the African news agency Panapress.
Libya approved its US$ 47 billion budget in June, after eight months of discussion. The figures already pose a decline from last year, when the budget stood at US$ 51 billion.
The commission appointed by the Parliament will include officials from other institutions in the country will analyse the request for revision. The current budget was planned based on a forecast of 800,000 oil barrels per day (bpd) sold at US$ 100 per barrel.
However, due to constant conflicts the country is facing, the oil output is well below the forecast, averaging 562,000 bpd this week. Thus, Libya has not been able to generate enough revenue to stick to its budget. During this period of crisis, Libya’s output has reached even lower volumes, below 200,000 bpd.
Libyan government has been trying hard to control opposing militias, the same militias which helped oust the dictator Muammar Gaddafi in 2011, and now hinder the use of oil production facilities. Said groups have taken control of some oil extraction and production facilities, in an attempt to thwart production.
The budget approved in June has been implemented with a delay due to attempts to cut expenditures to offset lower oil revenue. From the total initially forecast, most of the revenue would be generated by oil exports. Another portion, though, would come from the Central Bank’s reserve fund.
*Translated by Rodrigo Mendonça
