The net oil export revenues of OPEC are expected to fall in 2015 due to falling oil prices and lower oil exports, said the U.S.’ Energy Information Administration on Wednesday.
The U.S. agency projects that the net oil export revenues of OPEC are to fall to $446 billion in 2015, which is 46 percent below the 2013 level.
It is also estimated that OPEC members earned about $700 billion in revenue from net oil exports in 2014, which is a 14 percent decrease from 2013 earnings and the lowest earnings for the oil cartel since 2010, the agency added.
The agency stated that Iran is excluded from the projections since the current sanctions on the country and restrictions on accessing international payment systems make it hard to estimate their crude oil export revenues.
According to the agency’s Short-Term Energy Outlook report of Dec. 2014, several OPEC oil producers rely heavily on oil revenues to finance their fiscal budgets.
“Some producers have already started adjusting their upcoming budgets to reflect the crude oil price decline,” said the report.
The price of Brent crude oil is projected to average $68 per barrel in 2015, down from $100 per barrel in 2014 and $109 per barrel in 2013, the agency added.
The price of the global benchmark for oil has fallen almost 50 percent since June from $115 per barrel to below the $60 per barrel mark in December due to low global oil demand and a glut in oil supply on the markets.
In addition, the slow growth rate of Asian and European economies and the rise in the value of the U.S. dollar, of which the oil prices are indexed to, hamper the purchasing power of oil-dependent countries and lead to lower global demand for oil.
“Prolonged periods of lower oil prices have the largest effect on OPEC countries that are more sensitive to losses in revenue, most notably Venezuela, Iraq, and Ecuador, while their governments in these countries were already running fiscal deficits in 2013,” said the agency.
While some countries of the oil cartel, led by Venezuela, advocated lower production volumes for members to resist falling oil prices before the OPEC meeting on Nov. 27, the organization decided not to cut production and agreed to maintain 30 million barrels per day of output until June 2015.
The total net oil export revenues of OPEC was $821 billion in 2013, while Saudi Arabia leads the member states with $274 billion, followed by Kuwait with $92 billion, Iraq with $86 billion, Nigeria with $84 billion and Venezuela with $62 billion.
Other medium and small scale producers, like Algeria had $57 billion, United Arab Emirates had $53 billion, Qatar had $42 billion, Libya had $33 billion, Angola had $27 billion and Ecuador gained $11 billion from net oil export revenues.
Courtesy of Journal of Turkish Weekly (JTW)
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