Dubai (Platts)--26 Oct 2015 952 am EDT/1352 GMT

An oil price of $80/b would be "ideal" as the global economy moves towards higher growth, the UAE's minister of Economy, Sultan al-Mansouri said Sunday as his government approved a lower federal budget for 2016.

Anticipating a pickup in the global economy in the second half of 2016, Mansouri told journalists in Abu Dhabi the world could not afford to let oil stay at the current level of around $50/b.

His forecast goes against the International Energy Agency's, which forecast earlier this month that oil demand growth would reach a five-year high of 1.8 million b/d in 2015 before slowing in 2016 amid a weaker outlook for the world economy.

The UAE government Sunday approved a slightly lower federal budget of Dirham 48.56 billion ($13.2 billion) for 2016 as it cuts expenditure due to sustained low oil prices, according to state-run WAM news agency.

This is down from Dirham 49.1 billion in 2015, and the first cut in years. The IMF said last week it expects the UAE to post its first budget deficit since 2009.

The fund warned Gulf countries to adjust to the new oil price environment and streamline expenditure by raising non-oil taxes and reducing subsidies; something only the UAE has made any progress in by cutting fuel subsidies for motorists in August.

--Adal Mirza, adal.mirza@platts.com
--Edited by Wendy Wells, wendy.wells@platts.com

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