{
  "title": "Equilibrium Non-Oil Current Account Assessments for Oil Producing Countries",
  "publication": "IMF Working Papers, August 1, 2008",
  "sourceUrl": "https://www.imf.org/en/publications/wp/issues/2016/12/31/equilibrium-non-oil-current-account-assessments-for-oil-producing-countries-22271",
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  "summary": "This paper introduces a methodology for assessing external balance in countries with large stocks of non-renewable resources based on oil stock data, and applies it to selected oil producing countries.",
  "sections": [
    {
      "heading": "Summary of purpose and scope",
      "content": "- Introduces a methodology for assessing external balance in countries with large stocks of non-renewable resources based on oil stock data.\n- Applies the methodology to selected oil producing countries.\n- Uses a stock approach (instead of the more traditional flow approach) to estimate the equilibrium non-oil current account consistent with optimal consumption smoothing."
    },
    {
      "heading": "Methodology",
      "content": "- Stock approach: uses oil stock data and geological data for oil reserves to estimate oil wealth and the equilibrium non-oil current account.\n- Conceptual basis: consistent with optimal consumption smoothing and present discounted value/cash flow concepts.\n- Key methodological distinction: replaces or complements flow-based approaches by focusing on wealth implied by oil stocks."
    },
    {
      "heading": "Main findings and results",
      "content": "- Based on an oil price about US$70 per barrel prevailing in the summer of 2007:\n  - Baseline estimates indicate that the non-oil current accounts for most of the countries in the sample are broadly in equilibrium.\n- Using oil price projections as of the summer of 2008:\n  - Implies large disparities between the equilibrium non-oil current account position and the medium term forecast for all countries in the sample except for Malaysia."
    },
    {
      "heading": "Sensitivities and caveats",
      "content": "- The estimated non-oil current account norm is very sensitive to oil price projections.\n- Benefit of the stock approach: ability to use geological data for oil reserves to estimate oil wealth.\n- Caveat: sensitivity to oil price projections can produce markedly different equilibrium assessments depending on the price scenario used."
    },
    {
      "heading": "Publication and metadata",
      "content": "- Authors: Alun H. Thomas, Jun I Kim, Aqib Aslam\n- Date: August 1, 2008\n- Series: Working Paper No. 2008/198\n- Issue: 198\n- Volume: 2008\n- Pages: 24\n- DOI: https://doi.org/10.5089/9781451870565.001\n- Stock No: WPIEA2008198\n- ISBN: 9781451870565\n- ISSN: 1018-5941\n- Subjects: Consumption, Current account, Oil, Oil prices, Oil production\n- Keywords: cash flow, present discounted value, WP\n\nContent derived from the IMF working paper landing page for \"Equilibrium Non-Oil Current Account Assessments for Oil Producing Countries\".\n\n---\n\n Content in this bundle\n\n- wp08198\n  - wp08198 (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - wp08198 (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2016/12/31/equilibrium-non-oil-current-account-assessments-for-oil-producing-countries-22271"
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    "Authors: Alun H. Thomas, Jun I Kim, Aqib Aslam",
    "Published: August 1, 2008",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9781451870565.001",
    "Introduces a methodology for assessing external balance in countries with large stocks of non-renewable resources based on oil stock data.",
    "Applies the methodology to selected oil producing countries.",
    "Uses a stock approach (instead of the more traditional flow approach) to estimate the equilibrium non-oil current account consistent with optimal consumption smoothing.",
    "Stock approach: uses oil stock data and geological data for oil reserves to estimate oil wealth and the equilibrium non-oil current account.",
    "Conceptual basis: consistent with optimal consumption smoothing and present discounted value/cash flow concepts.",
    "Key methodological distinction: replaces or complements flow-based approaches by focusing on wealth implied by oil stocks.",
    "Based on an oil price about US$70 per barrel prevailing in the summer of 2007:",
    "Using oil price projections as of the summer of 2008:",
    "The estimated non-oil current account norm is very sensitive to oil price projections.",
    "Benefit of the stock approach: ability to use geological data for oil reserves to estimate oil wealth.",
    "Caveat: sensitivity to oil price projections can produce markedly different equilibrium assessments depending on the price scenario used.",
    "Authors: Alun H. Thomas, Jun I Kim, Aqib Aslam",
    "Date: August 1, 2008",
    "Series: Working Paper No. 2008/198",
    "Issue: 198",
    "Volume: 2008",
    "Pages: 24",
    "DOI: https://doi.org/10.5089/9781451870565.001",
    "Stock No: WPIEA2008198",
    "ISBN: 9781451870565",
    "ISSN: 1018-5941",
    "Subjects: Consumption, Current account, Oil, Oil prices, Oil production",
    "Keywords: cash flow, present discounted value, WP",
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