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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