IMF sees the pact with Iran as bad news for oil exporters

Imagen: EFE

For Latin American exporting oil countries is bad news the agreement between the US and Iran because it will mean an increase of between 500,000 and 800,000 barrels a day in oil supply, said the International Monetary Fund.

“It now faces an additional fence which will be the additional supply from Iran,” said Alejandro Werner, chief economist for Latin American IMF, at a press conference Alejandro Werner, who indicated that the expected recovery in the medium term of the oil price, which he described gradual and still below the levels reached in 2013.

The entity expects that a barrel of oil will cost an average of $ 59 this year. The greatest impact was felt a year ago with the drastic fall in prices, so that countries like Mexico and Ecuador are on the way to implement fiscal adjustment to mitigate the drop in revenues, Werner said.

But the expert said that Venezuela will have this year an inflation of over 100% and added that there has been no announcement from Caracas in the framework of fiscal and monetary policy in the medium term “involving setting and correction of imbalances.”

Although he kept his forecast that the Venezuelan economy will contract this year by 7%, last week, the IMF adjusted downwards its forecast for growth of the regional economy with regard to the forecast it had issued in April and stood it at 0.5 % this year and 1.7% the next.

Werner said Wednesday that the downward adjustment for 2015 included Chile (0.2), Colombia (0.4%) and Peru (0.6%), while it adjusted upwards the forecast for Argentina (0.4 %).

The economist emphasized an increase in investment and productivity as priorities that governments should focus in the region to reverse the downward trend of the last five years.