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Algeria has knocked $2bn off the expected deficit in its final 2018 budget. But the final figure of AD1.914bn ($16.9bn at the budget exchange rate of $1=AD113.5; $16.6bn at the latest actual rate of $1=AD115) still represents a rise of over 70% on an expected 2017 deficit of $9.6bn.
Some scope for a surprise on the upside comes from the use of a conservative oil price of $50/B, level with the 2017 budget oil price and somewhat lower than the actual 2017 average price of $54/B for Algeria’s Saharan Blend crude, a light grade which trades at near-parity to Brent.
Of course oil prices have risen well above $50/B in recent months – Brent was testing $70/B as MEES went to press. Were Saharan Blend to achieve an average of $67/B for 2018, in line with current futures prices, the deficit would fall to $8.4bn (see table).
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