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Budget deficits, currencies under pressure, affected public services… with the fall in crude oil prices, countries
dependent on oil are entering a zone of turbulence.
With the risk of increasing social and political instability already endemic for some.

The price war that has been raging since Monday on the oil market is plunging the energy planet into uncertainty.
So much so that Donald Trump spoke on the phone with the Saudi Crown Prince on Monday to discuss the
falling prices. Crude prices rallied significantly on Tuesday. Brent gained more than 5% in
in the afternoon, returning to the bar of 36 dollars a barrel. But no one dares to predict a rise
sustainable, so powerful are the forces unleashed by Riyadh and Moscow.
Saudi Arabia, the world's third largest producer, has announced that it is increasing its production by 25% from the
April 1, rising to 12.3 million barrels per day, a record. These volumes are even greater than the capacities
of the Kingdom, which means that the national company, Aramco, will draw on its stocks to put the most
volumes possible on the market.
Worse than 2015
Russia replied a few minutes later. The country can increase its production by 500,000 barrels per
day, announced the Minister of Energy, Alexander Novak. Russia would thus increase to 11.8 million barrels, a
record there too.
In shock, the producing countries are beginning to assess the impact, which will no doubt be lasting, on their economy. " The
situation is even more complicated than during the previous collapse in prices in 2015, because the increase
oil supply is combined with immense uncertainty about the evolution of demand due to the epidemic",
emphasizes Marc-Antoine Eyl-Mazzega, Director of the Energy Center at Ifri. “In 2015, the global economy was
in a recovery phase, whereas today we are in a downturn", adds Catharina
Hillenbrand-Saponar, at the credit insurer Euler Hermes.
Already explosive situations
Among the most affected countries, some are already in difficulty because they have suffered since last year from the
fall in gas prices. This is the case of Algeria, Nigeria and Angola. “It will be very hard for them”, laments
Marc-Antoine Eyl-Mazzega.
For other states, the fall in oil revenues will accentuate an already explosive social and political situation.
This is particularly the case of Iraq, one of the main members of OPEC, which needs a barrel at 60 dollars
to balance its budget. “Baghdad will struggle to fund essential public services like health and
education," said Fatih Birol, Director General of the International Energy Agency. “became a place
of confrontation between Sunnis and Shiites and a stake for Iran and Saudi Arabia, Iraq is particularly
unstable, continues the Ifri researcher. Daesh could take advantage of this to come back in force. »
Most producing countries have failed to reduce their dependence on hydrocarbons. " Many
of them are undermined by conflicts or led by sclerotic regimes that have no strategy
economic”, continues Marc-Antoine Eyl-Mazzega. Only two, Russia and the United Arab Emirates,
can balance their balance of payments with a barrel around 30 dollars, according to Euler Hermes.
All the other Gulf countries and the former Soviet republics are in budget deficit when the barrel
drops below $45. If prices remain at current levels, Bahrain, Oman and Kazakhstan
would see their external deficits climb “to levels likely to disrupt investors and put
their currencies under pressure,” said the credit insurer.
Latin America also affected
Bahrain and Oman will be able to count on financial support from their Gulf allies, anxious to avoid "a
contagion for their own currencies which are pegged to the dollar”. Kazakhstan, on the other hand, could be
forced to devalue its currency, as in 2015. For the other petro-monarchies and Russia, the deficits will be
"manageable", according to Euler Hermes, even if Moscow suffers a sharp depreciation of the ruble.
Apart from the big producers, the "small" oil companies will also be hard hit, although their
economy is more diversified. Ecuador and Colombia would lose more than one point of GDP if the price per barrel
remained at this level for a year, estimates Euler Hermes. Mexico would give up half a point of wealth
national. “Unlike Saudi Arabia, the Emirates or Russia, these countries cannot compensate
lower prices by increasing their production,” explains Catharina Hillenbrand-Saponar.