March 1, 2016 / 2:32 PM / 2 years ago

Azeri state oil fund's assets dropped 9.5 pct in 2015 to $33.6 bln

TBILISI, March 1 (Reuters) - Azeri state oil fund SOFAZ’s assets dropped by 9.5 percent year-on-year in 2015 to $33.57 billion, the fund said on Tuesday.

SOFAZ holds proceeds from oil contracts, oil and gas sales, transit fees and other revenue. It uses income from investments to pay for social spending and infrastructure projects.

The fund’s revenues reached 7.7 billion manats ($4.9 billion) in 2015, while its expenditure totalled 9.2 billion manats, SOFAZ said in a press release.

Revenue of about 7.4 billion manats was received from implementation of oil and gas agreements, it said.

The Caucasus nation of about 10 million people relies on oil and gas exports for about 75 percent of its revenues, but the oil price’s slump has triggered a plunge in the manat.

Azerbaijan’s parliament on Feb. 19 approved amendments to the 2016 state budget based on an average oil price of $25 per barrel, down from original forecasts of $50, part of a global squeeze on oil producers amid tumbling prices.

After amendments, transfers from SOFAZ to the state budget are expected to rise by 26.9 percent to 7.6 billion manats, while the rainy day fund’s own revenues are expected to decline to 3.5 billion manats from an initially projected 6.7 billion this year due to the plunge in oil prices.

SOFAZ sells dollars on the foreign exchange market in a bid to prop up the manat.

$1=1.56 manats Reporting by Nailia Bagirova and Margarita Antidze; Writing by Margarita Antidze; Editing by Mark Potter

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