Opec's export revenue surged 43% last year amid high crude prices, EIA says

Saudi Arabia’s exports accounted for more than a third of the group’s total revenue

The logo of Opec outside its headquarters. Reuters

Opec's export revenue surged by nearly 43 per cent last year as Russia's war in Ukraine resulted in higher crude prices, according to the US Energy Information Administration.

The group’s net oil export revenue rose to $888 billion in 2022, from $622 billion a year earlier, the statistical arm of the US Department of Energy has said.

“The increase in net export revenue in 2022 is mostly attributable to higher crude oil prices, and to a lesser degree to higher petroleum liquids production,” the EIA said.

Brent, the benchmark for two thirds of the world’s oil, surged to nearly $140 a barrel after Moscow’s military offensive against Ukraine began in February last year.

The international benchmark has since given all up of its gains and is now trading below $80 a barrel as Russian crude supply remains steady and economic slowdown concerns weigh on investor sentiment.

Opec’s total oil output rose to nearly 34.2 million barrels per day last year, up 2.5 million bpd from 2021.

Top crude exporter Saudi Arabia’s export revenue stood at $311 billion in 2022, representing more than a third of the group’s total revenue.

Export revenues of Iran and Venezuela, who are exempt from Opec+ production quotas, rose by $15 billion and $2 billion, respectively, year-over-year, the EIA said.

However, these projections do not consider possible changes to discounts that Iran and Venezuela offered to their buyers, it added.

The EIA expects Opec’s net oil revenue to fall to $656 billion in 2023, largely due to Opec+ production cuts and lower crude prices.

The group’s total production this year is forecast to drop to 33.5 million bpd as Brent crude averages $80 a barrel, the EIA said.

On June 4, top crude exporter Saudi Arabia announced a unilateral output cut of 1 million bpd for July and said it could be extended.

The Opec+ alliance of 23 oil-producing countries has said it will stick to its existing output cuts until the end of 2024.

The group has total production curbs of 3.66 million bpd, or about 3.7 per cent of global demand, in place, including a 2 million bpd reduction agreed last year and voluntary cuts of 1.66 million bpd announced in April.

“We forecast global oil inventories to fall slightly in each of the next five quarters. We expect these draws will put some upward pressure on crude oil prices,” the EIA said.

This month, Opec raised its 2023 oil demand growth forecast for China, the world’s largest crude importer, and said the recent economic slowdown in the country may persist until the middle of the year.

Global oil demand is projected to grow by 2.3 million barrels per day to 101.9 million bpd this year, the group said in its monthly oil market report.

Opec+ is fighting against “uncertainties and sentiments” in the market that is behaving against the fundamentals and forcing oil producers to take precautions, Prince Abdulaziz bin Salman, Saudi Arabia’s Energy Minister, said at an event earlier this month.

“I think the physical market is telling us something and the futures market is telling us something else.”