Algiers — Algerian Prime Minister Abdelmalek Sellal said late Wednesday he expects the oil price to fall further, adding that Algeria is now in a state of economic "crisis."
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Speaking on state television, Sellal said Algeria is to defer a number of key infrastructure projects due to the falling oil price as the slump begins to hit the North African country's economy.
"The decline in the oil price will continue and it will not go back to $120/b," he said.
"We are in a state of crisis," Sellal said. "Oil is below $50/b, and no one anticipated such a fall."
Algeria's 2015 budget is based on a price of $60/b.
"We will continue to invest in social projects, but we will have to cut certain non-essential spending such as trams and railways. These will be postponed," Sellal said.
Despite the economic crisis, Sellal said Algeria had sufficient cash reserves to meet its development budgets for the "next three or four years" without any issues.
He added that the current crisis would prompt Algeria to seek to lessen its dependence on oil and gas.
"We will help companies -- private and public," he said.
Algeria earned $60.15 billion from its oil and gas exports last year, a fall of $2.85 billion, or 4.5%, compared with the previous year, the country's national statistics agency, CNIS, said Wednesday.
The revenues represented 95.5% of Algeria's foreign earnings, highlighting the country's dependence on its oil and gas exports.
Algerian Oil Minister Youcef Yousfi has been one of the most vocal among OPEC ministers calling for the group to reduce its production to shore up falling oil prices.
With global oil prices now languishing below $50/b, the impact on Algeria's economy this year will likely be more severe than in 2014.
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--Edited by Maurice Geller, firstname.lastname@example.org