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Global oil market still unstable after 2014 crash – IMF

Gasoil News - Published on Wed, 13 Feb 2019

Image Source: Sputnik International
Sputnik reported that Christine Lagarde, the IMF’s managing director, has said that global oil prices remain highly unpredictable, meaning the world's major crude producers should adjust their fiscal plans accordingly and have contingency strategies ready in case of another possible oil bust. Speaking at a conference in Dubai, UAE, Lagarde said the future of the international oil market does not appear to be unequivocally bright due to a combination of upside and downside factors. Lagarde warned oil-reliant economies against ramping up budget spending, saying their oil revenue might plunge again. He said "Modest growth continues, but the outlook is highly uncertain.’

The IMF chief also said that over the past few years fiscal revenue in oil-exporting countries has improved, sparking an urge to increase budget spending among several national governments. Lagarde suggested such plans should be put on hold due to the lack of clarity of whither oil prices go in the near-to-medium-term.

Lagarde's remarks come in the wake of ambitious announcements from the governments of Saudi Arabia and the UAE, which both recently unveiled massive infrastructure and modernisation projects to ease their reliance on oil. However, IMF experts believe it's not the right time just yet, suggesting fiscal consolidation could be a better option.

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Posted By : Rabi Wangkhem on Wed, 13 Feb 2019
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