Devastating News For OPEC As Oil Revenues Hit A 10-Year Low

OPEC oil export revenues took a $438 billion hit last year, according to OPEC's 2015 annual report released on Wednesday.

Despite the poor showing in OPEC revenues, which were the lowest since 2005-OPEC managed to increased production by 0.8 million barrels per day, largely due to Saudi Arabia and Iraq, in a successful play to boldly-and perhaps recklessly¬-defend its market share. The increase in OPEC oil production ironically added to the total revenue decline.

"In value, total OPEC exports declined by 29.1 per cent year-on-year (y-o-y)," according to one of the key messages of the report.

OPEC's 2015 oil export earnings came in at $518 billion according to the report-a 46 percent drop-thanks to $50 oil. The result of the low-priced environment was an overall account deficit for the 13-member countries to the tune of some $99 billion in 2015, compared to a $238 billion surplus in 2014.

Before 2015, the most recent OPEC deficit was in 1998, when high inventories pushed oil prices to $10.

The question remains whether OPEC can stay the course during this low-priced oil environment through the remainder of 2016, because according to a report by the U.S. Energy Information Administration, oil export revenues are expected to fall 15 percent in 2016, before rising in 2017.

By Julianne Geiger for Oilprice.com

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