Key highlights for the first nine months of 2026:

• SOFAZ’s total assets stood at USD 74.0 billion (125.8 billion manats).
• Revenues generated from asset management activities totaled 3.6 billion manats.
• Oil and gas revenues from sales of hydrocarbons amounted to 7.3 billion manats.
• SOFAZ transferred 9.6 billion manats to the state budget.

The State Oil Fund of the Republic of Azerbaijan (SOFAZ) reports that its assets amounted to USD 73 542 million (125 021 million manats) at the beginning of 2026 and stood at USD 74 004 million (125 807 million manats) as of September 30, 2026.

During the period from January to September 2026, SOFAZ’s total revenues amounted to 12 341.3 million manats. The Fund’s revenues related to the implementation of oil and gas projects amounted to 8 740.6 million manats. Total revenues generated from asset management activities reached 3 600.7 million manats. Budget expenditures for the reporting period totalled 9 681.2 million manats.

Oil and gas revenues:

• SOFAZ's revenues related to the implementation of from oil and gas agreements totaled 8 740.6 million manats, consisting of:
• 7 343.9 million manats from the sale of oil and gas,
• 0.9 million manats from bonus payments and transit revenues,
• 4.9 million manats from acreage fees
• Proceeds from the sale of the state-owned share in “Southern Gas Corridor” CJSC amounted to AZN 1 390.9 million.

It should be noted that during the reporting period, SOFAZ received 6 570,6 million manats from the Azeri-Chirag-Gunashli field and 565,1 million manats from the Shah Deniz field (gas and condensate)

Budget expenditures:

• Transfer to the State budget. Within the framework of the 2026 SOFAZ budget implementation, a total of 9 628.0million manats were transferred into the state budget during the reporting period.
• Project expenditures. In January-September 2026, 27.7 million manats were allocated to the following ongoing projects:
• 3.6 million manats were directed to financing the "2019-2023 State Program on increasing the international competitiveness of the higher education system of Azerbaijan,"
• 21.9 million manats were allocated for the "State Program for the Education of Youth at Prestigious Universities of Foreign Countries for 2022-2028."
• Financing of international dual-degree programs amounted to 2.2 million manats.
• Operational expenditures. The operational expenditures of SOFAZ amounted to 25.5 million manats for the reporting period.

Extrabudgetary expenditures

During the reporting period, extrabudgetary expenditures arising from changes in gold prices and foreign exchange rates amounted to1 874.0 million manats.

Current state of financial markets and its impact on the portfolio

Global financial markets remained volatile during the third quarter of 2026, as persistent geopolitical tensions, inflationary pressures and expectations for monetary policy continued to influence all major asset classes. Global equities generated positive returns over the quarter despite volatility, while government bond markets came under pressure from rising yields. Commodity markets strengthened significantly, led by higher energy prices, while gold experienced considerable volatility and weakened toward the end of the quarter.

The bond sell-off was broad-based across major developed markets. Elevated energy costs, persistent inflation and resilient economic activity reinforced expectations that policy rates would stay higher for longer, while concerns over sovereign borrowing and heavy debt issuance added further upward pressure on longer-term yields. The increase in yields weighed on bond valuations, with September proving particularly challenging for fixed-income markets.

Equity gains were supported by resilient economic growth, strong corporate earnings and continued investment in artificial intelligence and related infrastructure. After a sharp rebound in August, sentiment deteriorated in September as higher yields and geopolitical flare-ups unsettled investors, but sound fundamentals allowed markets to hold on to their quarterly gains.

Gold climbed in August on safe-haven and investment demand, before reversing in September as U.S. Treasury yields and the dollar firmed.