The Impact of Oil Price Fluctuations on the General Budget and the Iraqi Gross Domestic Product form the Period 2010 to 2020

Abstract

The price of oil is affected by several economic, political, social, and climatic factors, in addition to the nature of the prevailing market. It is also subject to “continuous fluctuations due to the nature of the international oil market,” which is characterized by dynamism and instability. Monday, April 20, 2020 is considered a black day in the history of the oil industry oil as the standard American oil prices collapsed by 300% during that day's trading. The general budget in Iraq relies heavily on the revenues generated from oil export, as it constitutes 90-95% of the state’s revenues, which affected the country’s economy due to fluctuations in oil prices. The importance of oil in Iraq stems from its provision of significant and essential cash surpluses for financing national development projects, as Iraq is ranked fifth in the world for oil reserves and ranked second in the Arab world in oil reserves in 2017, which encouraged reliance on it in the formation of the gross domestic product.