Falling Oil Prices and UAE Government Expenditure

Background Information

Globally, oil prices fell sharply in 2014 and have been in unstable trends since then. Arguably, the 2014 downfall in oil prices could be an indication to an end of the supercycles associated with the prices of hydrocarbons. It is imperative to note that the current trends do not support previous theses on oil price falls and the subsequent economic effects. Initially, decreases in oil prices were associated with positive economic outcomes, with the exporting countries getting to benefit more than the importing countries. On the other hand, sharp increases in oil prices led to a global recession like the cases of 1973, 1979, 1990, and 2008 economic meltdowns. The difference with the current price fall is that the exporting countries are feeling the negative impacts of low prices, and they are at high economic risks.

Although there were some indications of rises in prices at the beginning of 2016, experts predict further downward trends in the future (Berman 1).

The falling oil prices have adverse effects on the global economy and could lead to a global recession. The most affected economies are the countries that depend on oil as the major source of revenue. Some countries, especially Middle East countries, depend on oil to fund most of the government expenditures.

This paper evaluates the impact of falling oil prices on the UAE government expenditure on developmental projects from a risk management perspective. It is apparent that the UAE government depends on oil to fund developmental projects and, therefore, the falling oil prices and the subsequent loss of revenues expose the UAE government to huge economic risks.

Some vital data about the UAE

Table 1: the UAE GDP.

2010 2011 2012 2013 2014 2015
$ 286 B $ 347 B $ 372 B $ 402 B $ 402 B $ 402 B

Source: (Organization of the Petroleum Exporting Countries 15)

Since 2013, the UAE GDP has almost remained the same. The declining oil prices could negatively impact the growth in the country.

Table 2: Current account balances in OPEC Members (m $).

2010 2011 2012 2013 2014
7,24 50,948 68,961 64,846 48,453

(Organization of the Petroleum Exporting Countries 17).

Data from OPEC indicate a declining current account balance. These declines are attributed to lower oil prices as Bank Audi Sal reports (Bank Audi Sal 1-18). For instance, the year 2015 was characterized by widening deficit gaps for services and income balance. It, however, reflects the UAE efforts toward diversification of the economy and higher rates of spending. Accordingly, the country’s current account balance has recorded a year-over-year drop. The country’s non-oil exports have risen while oil and gas export share declined from 30% to 21% between 2014 and 2015.

It is observed that countries, such as the UAE, that are highly dependent on oil export have reacted with the significant fiscal stimulus to avert drawbacks associated with low revenues from hydrocarbon exports (Dabrowski). Nevertheless, the UAE now experiences deteriorating current account balances and weaker fiscal status on year-over-year basis. The reliability of this approach will be guided by future oil prices, fiscal stimulus, taxes, and reserves.

Table 3: OPEC Members’ values of petroleum exports (m $).

2010 2011 2012 2013 2014
74,638 111,607 119,986 122,973 107,853

Source: (Organization of the Petroleum Exporting Countries 17).

Economic Diversification / non-oil sectors

Bank Audi Sal reports that non-oil sectors, such as real estate and construction, tourism, and transport, have continued to record significant investment and growth despite the decline in oil and gas revenues. Nevertheless, the growth is slow, cautious, and targets specific areas like retail, commercial, and hospitality real estate investment (Bank Audi Sal 1-18).

The UAE has continued to spend heavily in the transportation sector. In fact, the UAE government plans to maintain upward trends for the next five years despite the drop in oil prices (Bank Audi Sal 1-18). Dubai, for instance, will increase spending by 20 percent in the transportation sector. The Vision 2021, the Dubai 2020 Expo, and the STMP of Abu Dhabi are the major driving forces behind huge sustained investments in the sector. About $20 billion will be invested between 2015 and 2017 in the UAE.

The tourism sector has also continued to grow with a contribution of about AED 61.6 billion (4.1%) to the GDP. It will grow by about 4.9% every year.

The financial sector, however, has reacted negatively to the decline in oil revenues. For instance, banks noted slowed activities in 2015 with a growth of 6.1% in 2015, but the volume of asset growth recorded a decrease of 42% relative to the year 2013. Nevertheless, they had favorable capitalization, asset quality, and notable profitability.

The capital markets in both Abu Dhabi and Dubai have recorded declines in trading.

The Federal Budget Cut

Following the drop in oil prices, the federal government of the UAE approved a budget cut by 1.2% (Wright 1). However, priority was only given to health and education because they impact the public directly.

The federal government commitment of AED 48.75 billion ($13.2 billion) reflected a decline in the budget. This decline clearly depicts a response to low oil prices. It is expected that 2016 commitment would be lower by about 1.1% as it focuses on funding social development.

The 2016 federal budget has allocated more than 50% to public services, education, social development, and health because they influence the lives of ordinary people directly. The federal budget allocation for education was 21.2%, social development was 15.4%, public services received 11.1%, and the health sector was allocated 7.9%. In addition, the federal government allocated funds to housing, defense, environment, culture, economy, and public safety (Wright 1). The spending-cut is most likely to continue if revenues from hydrocarbon exports decline.

Identification of the risks

The UAE’s economy is facing high risks from the volatility in global oil prices. It is evident that most of the government projects are highly affected. As such, the projects are likely to generate less revenue and, therefore, some will become less profitable while others will even incur losses. Actually, some of the government projects face elongated delays or even cancellations.

The consolidated UAE government revenue is expected to be in decline with the falling oil prices. In 2014, for instance, the consolidated revenue fell by approximately 23 percent, and the same (or even worse) is likely to recur. It is worth noting that the fall in prices had rippling effects on other macroeconomic and microeconomic elements. Consequently, there was a decline in the overall government expenditure in 2014.

From the 2014 scenario, it is evident that the situation might get worse if the prices continue falling. The risks will even get higher if the prices get lower than the country’s fiscal breakeven point, which is estimated to be US$72 pb (International Monetary Fund 1).

The UAE government has insisted that developmental projects, especially infrastructure, will be brought to completion. However, it is inevitable that the UAE will be compelled to cancel, suspend, or delay major government developmental projects due to the falling oil prices.

Major effects have already become apparent. In fact, some projects have already been canceled. For instance, in Abu Dhabi, government projects with an approximated worth of US$200 billion have been canceled due to their unviability and their high probability of making losses as their sources of revenues have declined.

It is evident that the cancellation and the suspension of the government developmental projects will raise not only economic risks but also litigation risks. Contractual disputes are more likely to emerge from all the affected stakeholders.

Analyzing the risks

Although the UAE has made considerable progress in diversifying its economy away from oil production in the recent past, the progress is not replicated in the diversification of sources of revenues to fund major government developmental projects. Therefore, the UAE developmental projects are still highly vulnerable to the downward trends of global oil prices.

The falling oil prices will make the UAE operate on a deficit budget, especially if an annual oil price falls below USD 72pb (International Monetary Fund 1). The negative budget will definitely have adverse effects on the government expenditure on projects exposing them to heightened risks.

Evaluating the risks

As mentioned earlier, the current fall in oil prices has made the exporting countries suffer losses of revenue as opposed to the previous scenarios where exporting countries had relative benefits from the falling oil prices. Therefore, oil exporters are faced with higher economic risks than oil importers.

Although the frequency of the occurrence of risks associated with falling oil prices in the past is low, the 2014 scenario set an extremely grave precedence. If the trend is to persist, the probability of the UAE suffering economic losses due to declining revenues is extremely high.

The occurrence of the risk is likely to have extremely adverse impacts on the UAE economy. The impacts of the risks are likely to have long-term effects on the UAE government source of revenue. Although the UAE has made some progress in the diversification of the economic activities, the sources of government revenues still have a substantial dependence on oil. Some of the elements that are likely to be impacted by the risks include the mega projects that the UAE government has initiated. Such projects could be canceled, postponed, or delayed.

The cancellations or delays of the developmental projects will have replicating effects that will heighten the level of risk impacts. For instance, contractual legal issues are likely to arise. Additionally, economic elements that necessitated the demand for the projects will be impacted.

Responding to the risks by formulating plans

Even though the UAE is faced with lesser levels of risks relative to other Middle East countries, the risk is substantial and should be mitigated by formulating appropriate plans. All stakeholders must be involved in processes of formulating plans for comprehensive mitigation strategies.

This paper gives suggestions of some of the plans that the UAE should take in order to respond to the evident risks associated with the fall of oil prices. First, the UAE government should consider rationalization of spending and augmenting non-oil revenue collections to fund developmental projects.

Additionally, the UAE government should protect all its investment on developmental projects to reduce fiscal vulnerabilities. The UAE government has many upcoming mega projects, especially on infrastructure. It is highly recommended that the UAE government should execute these projects to be in line with the expected economic demands. However, the UAE government should put strategies to oversee capital expenditures to enhance efficiency and transparency.

Further, the government should develop proper frameworks to manage domestic debt. Domestic debt can reduce the reliance of the government on the oil and, therefore, reduce the risk probability and potential impacts.

Risk Management Cycle

Risk Identification

The declining oil revenue from the oil sector globally has been identified as a major risk to the UAE government investments in development projects. Many observers have noted low and falling oil prices globally (Pettinger 1; Mathew 1). As such, low prices have resulted into declining revenue for oil exporting countries. As a result, such countries, including the UAE now have weak external and financial balances. In fact, the revenues for the year 2015 were estimated to decline by almost $300 billion globally relative to the year 2014. It has also been observed that the United Arab Emirates might not record any economic growth beyond 3% in the year 2016 due to low oil prices that affect revenues (Nagraj 1).

Currently, oil prices have reached multi-year lows, and they have affected the UAE economic progress. Brent crude oil price now ranges between $27 and $35 relative to highs of $114 in the year 2014.

Consequently, the UAE is most likely to clear its account surplus, cut new hiring, slow down government investments, and even face fiscal deficit if the situation continues. While foreign reserves and sovereign wealth funds are still available, they are meant for long-term measures and building wealth. As such, the UAE is now cancelling government projects under oil subsidies, water and electricity subsidies while watching prices (Gedvilas 1). The oil revenues accounts for more than 30% of the country’s GDP.

Identified likelihood and impacts

The UAE is now certain of the risks associated with the declining oil prices. In fact, while the global oil market is expected to recover, this is not likely to happen soon in the near future.

The impacts of declining oil prices are simply described as major. The impacts are long lasting, not protected by insurance, and the UAE citizens could miss critical development projects due to suspension or termination. The declining oil prices will be an extended discourse while its impacts on the government core developmental objectives are major.

Mitigation

Controlling global oil prices is beyond the capabilities of the UAE government. As such, the government has limited alternatives to mitigate the risk because it cannot transfer the risk to other parties. It will have to terminate some development projects and subsidies relying on oil revenues. While the UAE government can tolerate the risk, it would be difficult to sustain it in the end.

Implementation

Procedures can only be useful if they are sufficiently implemented. The UAE government should implement strategies to mitigate challenges associated with the risk of the declining oil revenue. The government must comprehend its roles and responsibilities in order to realize meaningful development in fiscal hardship.

Monitoring and Reviewing of Performance

Fiscal risks should not be left alone. The government must continuously conduct an on-going review to determine emerging issues and act proactively to avert development ruins. Hence, the UAE government can handle any emerging issues as they arise.

The internal and external environment for risks using PESTLE

PESTLE Analysis is chosen to assist in identifying and comprehending the environment in which the UAE operates based on the risk of declining oil revenues and strives to show how it may operate in the future.

Political

Government developmental projects are often influenced by new policies and decisions. In addition, oil prices often influence geopolitical relations. With the entry of Iran and the US shale oil and gas, the future of oil prices remains unpredictable. As such, the UAE government tax policies; employment laws and regulations; trade tariffs, trade barriers/restrictions; political stability and economic reforms will have to change, which will ultimately influence government investment decisions and objectives. In fact, it is now difficult to manipulate oil prices under the support of OPEC.

Since June 2015, the UAE government has continued to review oil-related subsidies with the aim of reducing costs.

Economic

Oil prices influence significant economic factors in the UAE. Interest rates, economic growth, exchange rates, wage rates, cost of living, inflation, and even working hours are linked to oil prices. These factors will have significant impacts on the government investment decisions in development projects. The UAE economy is projected to grow by less than three percent and employment rate will continue to dwindle because of declining oil revenues. With the growing budget deficit, it would be difficult for the government to execute some of its development projects in the near future and meet its development agenda.

Risk appetite and investment drives will continue to fall in the UAE.

Social

More young people and expatriates enter the UAE job market. With slow economic growth, it would be difficult for the government to meet its agenda of increasing the rates of employment and growing the economy. As such, social issues may emerge in the UAE. In fact, the UAE now charges for water and electricity from households.

Technological

The cost of oil production continues to rise. In the US, however, the so-called fracking technology has led to low cost of extracting shale gas and oil. To cut costs of oil production and protect revenues, the UAE government should consider new technologies from the West. Thus, more revenues will be available for investment opportunities.

Legal

Laws and regulations continue to impact the oil sector. It is required to cut emission significantly to combat global warming. Domestically, various policies are available to guide the investment of oil revenues in viable sectors.

Nevertheless, the falling oil prices have brought about multiple legal issues, which the industry must consider. Both the buyer and seller are now focused more on legal due diligence processes than previously witnessed (Rosychuk 1). The government now concentrates on the most appropriate ways to allocate liability that could result from decommissioning and environmental catastrophe. Hence, the focus is on the party responsible for the cost in cases.

Contracts are now being renegotiated while material adverse change clauses could have critical impacts on oil players.

The government must understand its abilities and financial position to tolerate low oil prices as many Joint Operating Agreement could becoming contentious.

Oil price hedging arrangements, ending portfolios, and lending redeterminations are most likely to bring about new legal complications for oil exporters based on price expectations.

Environmental

Low oil prices are now linked to increased uptake of green energy. The world largest oil exporters must now focus on how to curb increased local consumption of petroleum product (Goldenberg 1). They must now invest in green energy such as solar, and wind power.

Low oil prices have forced the UAE to encourage households to install solar panels and impose energy conservation policies with the aim of reducing domestic consumption and cutting the rate of carbon emission.

Risks classification

Several criteria are used to classify risks. Operational risks; business and strategic risks; financial risks; and safety and hazardous risks are given as four major classes of risks. This risk classification is essentially relevant to assist risk managers to understand the appropriate risk treatment processes and responsibilities by considering the risk type.

Financial risks

First, the UAE government is concerned about the oil pricing risk that eventually leads to low oil prices in the world market. This situation in turn affects the country’s revenues and subsequent investments in development projects. Second, credit risk is possible and the issue of liquidity has emerged among the UAE banks and small businesses. Thus, elongated high financial spending coupled with low oil revenues would eventually affect the UAE government fiscal position and creditworthiness.

This situation could affect bank ratings in the UAE. Finally, on liquidity risks, Moody had shown that the UAE liquidity would tighten. The direct government deposit had reduced by 13% since December 2014 because of falling oil revenues. The same situation has also extended to the public. Nevertheless, there are no immediate liquidity risks because of adequate deposits.

Operational risks

First, legal risks are bound to occur because of low oil prices and revenues. In fact, the above-mentioned risks reflect some legal challenges the UAE is most likely to face now. Second, personnel risks are now linked to declining recruitment of professionals in the UAE. Third, there are IT related risks. It would be difficult for the UAE to invest in new technologies that focus on cost reduction, time saving, and risk reduction.

It is however noted that service firms with IT solutions that enhance efficiency, risks, and costs have continued to perform well. Technology has allowed oil-producing nations to drill few wells but maximize output of oil and gas. At the same time, they have also focused on reducing costs of services and tools in the oil sector. Finally, process risks have resulted from reduced investments in systems that support the supply chain. As such, the oil sector will record increased losses.

Strategic and business risks

First, after the entry of Iran into the global oil and gas market, the UAE perhaps now has a weaker market position. Further, the fracking technology used in the US continues to generate more oil and gas, which ultimately weaken positions of all oil-producing countries. Low economic growth leads to reduced export of oil. Second, operating environment risks in the oil and gas sector have continued to increase. Specifically, legal, investment, costs, and revenues among others have presented risks beyond prediction. In fact, energy insurance continues to be shaped by low prices to reflect new realities. Lastly, one major management risk facing the UAE is how to identify specific areas for cost reduction and where savings can be realized in order to cope with low oil prices.

Safety and hazard risks

First, safety is an imperative consideration for the oil and gas industry. While the oil prices are falling, the UAE must maintain the recommended safety standards. Second, security arrangement is now critical in the Middle East countries. These countries must protect their oil installations from terror threats and sabotage from ISIS and other terrorist organizations. Hazard could result from oil spill, gas leakage, or fires. Finally, environmental protection remains a major source of concern not only for the UAE, but also for other nonoil producing countries. Overall, safety and hazard risks continue to be critical despite the low oil prices, and they cannot be compromised.

Risk evaluation based on likelihood, impact and magnitude and its effect on people, process, infrastructure, finance, profitability, and opportunities

Likelihood Level

Declining oil revenues for the UAE is the identified risk. It is imperative to recognize that the source of the threat is external and, therefore, beyond the control of the UAE government. Several factors, as previously mentioned, have motivated low oil prices leading to declining revenues for the government. It is not clear when the world oil prices will increase.

Declining revenues due to low oil prices puts the UAE at vulnerable position. That is, the government must cut its budget for development projects and subsidies. To deter the current impacts of declining revenues, the UAE government has started to charge for water and electricity while looking for specific areas for budget cut. These measures are most likely to deter immediate threats to the economy, but are not long-term solutions.

Likelihood Level Likelihood Definition
Medium The source of declining oil revenues continues to appear as sustained and capable of increasing. Nevertheless, the UAE has created some controls, which could impede effective exercise of the vulnerability.

Impact

It is imperative to understand threat levels associated with declining oil revenues to the government. The risk impact can be categorized as medium due to associated loss of revenues, declining values of assets, impacts of operation, and investment in public development projects.

Impact Impact Definition
Medium Costly loss of revenues, assets, hindrance on operations, and negatively impacts on investment in infrastructures and public services

Magnitude

The impact of declining revenues due to low oil prices is widespread and affects the entire UAE and nearly all other related element.

Effect on people, process, infrastructure, finance, profitability, and opportunities

The UAE households are already paying for electricity and water – commodities that were once highly subsidized in the country. In addition, the rate of employment in professional sectors has declined while liquidity could become a problem in the near future.

The loss of significant revenues has automatically led to slower processes in various sectors. For instance, the banking system is now slow to invest in oil-related ventures while legal processes have changed completely.

It is noted that the UAE, in particular, Abu Dhabi, is now channeling less fiscal resources toward high-profile infrastructure investments and other projects abroad. Moreover, there is emphasis on domestic economic growth. At the same time, some local projects now face delays or in some instances have been cancelled altogether. It is difficult to understand the true picture because of the secrecy surrounding the UAE budget, but spending patterns and details have changed in the recent months.

Financially, the impact of declining oil revenues is severe. More than 30% of the UAE GDP is derived from the oil and gas industry. Hence, any further financial assistance, investment, assets acquisitions, or aid to other poorer members of the UAE could be put on hold, slowed, or cancelled. In fact, low oil prices were projected to reduce the UAE consolidated revenue by more than 225. This would leave the government with a financial deficit of more than 30.6 billion dirhams (2.4% of the GDP).

Profitability from oil and oil-related sectors continues to drop. This implies that the UAE government may not have surplus for investment opportunities in developmental projects.

Declining oil revenues present both opportunities for progress and lost opportunities for development. Obviously, developmental projects in the UAE will suffer significantly. On the contrary, the UAE sees the drop of oil revenue as opportunities for greater diversification of the local economy. In this case, there is a growing emphasis on grow the local economy and invest in green energies.

Risk ranking or rating and priority list with reference to likelihood, impact, and magnitude

The likelihood of the risk is ranked as medium (0.34 to 0.66) to show that vulnerability factors are still present and may not be easy to eradicate.

The impact of declining revenues from oil is ranked as high (0.67 – 1.00). Multiple developmental projects are affected by the risk. In addition, the impact is major and can be felt throughout the UAE.

Finally, the magnitude is also high (0.67 – 1.00). The case of Abu Dhabi, which generally depends on oil relative to other members of the UAE, shows how declining oil revenues will affect the UAE investment opportunities in the near future.

Risk assessment matrix with areas of priority

The risk assessment priority rating reflects critical areas, which are most affected by the declining revenues because of low oil prices. The impacts, if not mitigated adequately, could present severe challenges to the UAE. While it is recognized that the UAE economy is highly diversified relative to other oil-exporting countries, it still relies heavily on oil revenues to fund major developmental projects.

Impacts
Likelihood Finance Infrastructure Process People Profitability Opportunities
M H H M H M H
H High risk— Action plan is required soon to avert possible extreme outcomes
M Moderate risk — Action plan is necessary to avoid budget deficits

A response based on the priority list generated

In the recent past, the UAE government came up with a plan meant to introduce new taxes. Sales and corporation tax is noted an immediate reaction to the low global oil prices. The value added tax, commonly referred to as the VAT, will mainly affect luxury products, alcohol, and tobacco. These goods will attract high rates while foodstuff will be exempted. The financial risks, people, and other opportunities will not be negatively affected.

It is also noted that the UAE has a wide variety of choices to revamp revenue collection and cut spending. In fact, the IMF has always urged countries with shortfalls to increase revenue collection and cut spending as immediate, short-term measures (International Monetary Fund 1).

For instance, the UAE government will cut spending on employee compensation by a significant margin, and increment was only expected at the rate of 3.4% in 2015.

Further cuts in subsidies are expected to help the government to reduce expenses. It had planned to reduce subsidies by 34% and grants by 48%.

The UAE government was expected to reduce its budget spending by 4.2% in 2015 as a reaction to low oil prices and declining revenues. While the UAE government rarely reveals its consolidated budget, the current available figures show a reaction to cheap oil.

By deregulating fuel prices, the UAE is stern about enhancing its financial position while protecting current investments and making fiscal reforms.

The UAE government is also focused on further diversification of sources of revenues, developing a resilient economy and improving competitiveness while eliminating dependence on the government subsidies.

Strategic risk management solutions with short term and long term focus

Given the declining revenues, the UAE economic outlook, as predicted by the IMF, was noted as moderate. In addition, it was most likely to experience a deficit in 2015. Thus, new taxes were seen as both long-term and short-term measures.

The IMF has claimed that the declining oil prices and revenues could become persistent. Thus, the UAE should consider stringent fiscal adjustment for fiscal sustainability to reflect new realities in the world oil market.

The UAE must continue to focus on encouraging foreign direct investment aggressively. This long-term measure will ensure that the UAE is less reliance on the government resources for developmental projects.

Other long-term measures to curtail declining revenues and related risks as previously mentioned include rationalizing spending, focusing on non-oil revenue sources, developing effective oversight to enhance efficiency and transparency in the state budget, and developing a proper framework for domestic borrowing.

Step 1: Identifying Risk Step 2: Categorising Risk Response
Risks identified Likelihood
High/Medium/Low
Magnitude
High/Medium/Low
Impact
High/Medium/Low
Loss of Revenues from oil export Medium (0.34 to 0.66)
The source of declining oil revenues continues to appear as sustained and capable of increasing.
  • The US fracking technologies
  • The entry of Iran in the international oil market

Nevertheless, the UAE has created some controls, which could impede effective exercise of the vulnerability.

Magnitude high (0.67 – 1.00)

Widespread and affects the entire UAE and nearly all other related elements – including government projects, such as subsidies, investments in development projects

High (0.67 – 1.00)
  • Federal budget cut
  • Fiscal deficit in 2015 budget
  • New taxes
  • Elimination of subsidies
  • Slow growth in the financial sector

Costly loss of revenues, assets, hindrance on operations, and negatively impacts on investment in infrastructures and public services

Impacts noted on people, process, infrastructure, finance, profitability, and opportunities

Reducing subsidies

Introducing new sales tax

Stringent fiscal adjustment for fiscal sustainability

Encouraging foreign direct investment

Curtail declining revenues and related risks – intense diversification

Conclusion

The declining revenue from low oil prices has been identified a risk to the UAE government investment in developmental projects. With widespread highly ranked impacts and magnitude, further declines could severely affect the UAE despite its relatively diversified economy, which has performed well so far.

Nevertheless, there are instructive strategic choices for both short-term and long-term measures to curb negative consequences of the risk. Fiscal reforms will help the UAE to implement some of its developmental projects. In fact, the UAE is advised to consider the low oil prices majorly as permanent and review its short-term and long-term fiscal plans to avert possible degradation of buffers and investments.

Works Cited

Bank Audi Sal. UAE Economic Report. Lebanon: Bank Audi Sal, 2016. Print.

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Dabrowski, Marek. The Impact of the Oil-price Shock on Net Oil Exporters. 2015. Web.

Gedvilas, Justas. Why the United Arab Emirates Refuse to Panic over the Falling Global Oil Prices? 2015. Web.

Goldenberg, Suzanne. “Slump in oil prices drives green energy takeup in top exporting nations.” The Guardian. 2016. Web.

International Monetary Fund. “Learning to Live With Cheaper Oil Amid Weaker Demand.” 2015. Web.

—. Oil Prices and the Global Economy: It’s Complicated. 2016. Web.

Mathew, Roy. Effect of Declining Oil Prices on Oil Exporting Countries. n.d. Web.

Nagraj, Aarti. “UAE economy hit by low oil, unlikely to grow over 3% in 2016 – minister.” Gulf Business. 2016. Web.

Organization of the Petroleum Exporting Countries. Annual Statistical Bulletin 2015. Vienna, Austria: OPEC, 2015. Print.

Pettinger, Tejvan. Impact of falling oil prices. 2015. Web.

Rosychuk, Jason. Looking at legal issues borne out of the oil price. 2015. Web.

Wright, Gary. UAE approves budget cut for 2016. 2015. Web.