IMF sees improved prospects for ME Gulf oil exporters

IMF sees improved prospects for ME Gulf oil exporters

Dubai, 27 April (Argus) — Major oil exporters in the Middle East and north Africa (Mena) stand to receive a windfall from higher oil and gas prices, but countries in the region still need to accelerate structural reforms, according to the IMF.

In its latest economic outlook for the Mena region, the IMF forecasts oil prices will average $106.83/bl in 2022 and $92.63/bl in 2023. The projections — an average of the Brent, Dubai and WTI benchmarks — are well above fiscal breakeven prices for all regional oil exporters, according to the IMF. The fiscal breakeven is the oil price required for a balanced state budget.

Downside risks dominate the IMF's outlook, including the prospect of a prolonged war in Ukraine, further sanctions on Russia, tighter-than-expected global financial conditions, a sharper slowdown in China and new Covid-19 outbreaks. The pace of structural reform in the Mena region needs to speed up to mitigate the impact of tighter macroeconomic policies on growth, address long-term scarring from Covid-19 and the war in Ukraine, and improve resilience in the post-pandemic world, the IMF said.

"To bolster a sustainable, inclusive and greener recovery, countries should prioritise measures that tackle some of their long-standing structural issues, such as