Members of the Organization of the Petroleum Exporting Countries (OPEC) are projected to earn about $323 billion in net oil export revenues in 2020, according to the U.S. Energy Information Administration (EIA). If realized, this would be the lowest revenue in 18 years.
Lower crude oil prices and lower export volumes contributed to the projected decline in export revenues. Crude oil prices have declined as a result of lower global demand for petroleum products because of responses to COVID-19. Export volumes also declined as a result of OPEC agreements to limit crude oil output that were made in response to low crude oil prices and production disruptions in Libya, Iran and Venezuela.
OPEC earned about $595 billion in net export revenues in 2019. This is less than half the record high of nearly $1.2 trillion that was earned in 2012. Continued revenue declines in 2020 could affect member countries’ fiscal budgets, which rely on revenues from oil sales to import goods and support social programs and public services. The expected decline in net oil export revenue in 2020 can be attributed to voluntary cuts and low crude oil prices.
The benchmark Brent crude oil spot price fell from an average of $71 per barrel in 2018 to $64 per barrel in 2019. The price decreased by $1 to $40 per barrel in October, from September, and it is expected to remain flat through the remainder of 2020. OPEC petroleum production declined to 34.5 million barrels per day in 2019, from 36.6 million barrels per day in 2018. The production is expected to fall by 3.9 million barrels per day to an average of 30.7 million barrels per day in 2020.
The OPEC revenues estimate is based on expected petroleum liquids production, including crude oil, condensate, and natural gas plant liquids, and expected values of OPEC petroleum consumption and crude oil prices.