Oil-dependent countries in the Middle East and Africa will see low crude prices hammer their fiscal positions in 2025, with only the UAE and gas-rich Qatar able to break even at current levels, according to a new report from S&P Global Market Intelligence.

Platts-assessed Dated Brent averaged $101/b as recently as 2022, but high non-OPEC+ supply, sluggish Chinese demand, US tariff announcements and OPEC+’s decision to unwind 2.2 million b/d of voluntary cuts have put a ceiling on prices this year. Platts is part of S&P Global Commodity Insights.
Analysts at Market Intelligence predict that the benchmark will average $68/b this year. It was last assessed at $70.01/b on July 16 and has averaged $71.79/b so far in 2025.

As a result, “low oil prices will damage the fiscal position of financially weaker countries in the Middle East and Africa, including Angola, Nigeria, Iraq and Oman, with the risk of downward multiplier effects,” the report notes.

Top of the pile is Gabon, which requires an oil price of $117/b to balance its books, while the UAE, which has taken major steps to diversify its economy in recent years, needs just $42/b.

Saudi Arabia, the de facto leader of OPEC, has a fiscal breakeven price of $93/b, thanks to an expensive economic reform agenda and infrastructure building spree, while the government of Nigeria — Africa’s biggest producer — can meet its running costs at $86/b, the report finds. Iraq, the second biggest producer in OPEC, needs an oil price of $99/b.

Broad consequences
Fiscal challenges owing to weak oil prices can have broad consequences for oil-exporting countries, particularly those that have seen sluggish non-oil development.

Perhaps most at risk is Iraq, which relies on oil revenues for the lion’s share of its budget, including to pay the salaries of millions of government employees.

“We expect Iraq’s foreign-exchange reserves to decline sharply, from $102.3 billion at end-2023 and $87.05 billion at end-2024 to $70 billion by end-2025, bringing it close to the level where emergency policy action is likely,” the report said.

“An accelerated decline in oil prices could lead to a more rapid fall of reserves and potentially require additional cuts to public-sector spending, potentially triggering protests against the government.”

In addition, Angola, which quit OPEC in 2024 following a row over its production quota, will only be able to cover 90% of its debt service costs at an oil price of $68/b, the report finds, increasing its risk of insolvency. Africa’s second biggest producer is estimated to owe some $60 billion to a slew of creditors, equivalent to two-thirds of GDP.

Meanwhile, Nigeria’s 2025 budget assumes an average oil price of $75/b and production of 2.06 million b/d, suggesting its fiscal position could come under severe strain this year. The country pumped just 1.7 million b/d of crude and condensate in June, according to the latest update from the Nigerian Upstream Petroleum Regulatory Commission.

Oman too could see its first fiscal deficit — of 4.2% of GDP — since 2021, with lower oil prices already leading to plans to levy income tax on high-earners from 2028, the report said.

OPEC+ unity
Besides illustrating the challenges faced by oil-dependent countries, the report could be a harbinger of future challenges for the OPEC+ alliance, particularly when it comes to maintaining group unity.

Since April, eight countries implementing voluntary production cuts have announced rapid quota hikes to return the barrels by the start of October, adding downward pressure on a market already digesting US President Donald Trump’s demand-sapping tariff announcements.

UAE energy minister Suhail al-Mazrouei told journalists in Vienna last week that low stocks around the world show the market “needed those barrels”.

To date, only Saudi Arabia has followed through on the planned production hikes, and analysts say the taper could hammer prices toward the end of the year by creating a supply glut, should the rest of the group do the same.

Fears of excess supply led some of the countries to seek a pause or reduction in quota hikes at the June meeting, sources told Platts at the time, while officials from oil-dependent countries have grumbled privately about the threat posed to their lifeblood oil revenues.
Source: Platts