The members of the Organisation of the Petroleum Exporting Countries (OPEC), including Nigeria, combined net oil export revenue will fall this year to its lowest level since 2002, according to the United States Energy Information Administration.
The EIA, in its latest forecast, said members of OPEC would earn about $323bn in net oil export revenues in 2020.
“If realised, this forecast revenue would be the lowest in 18 years. Lower crude oil prices and lower export volumes drive this expected decrease in export revenues,” it said.
It noted that crude oil prices had fallen as a result of lower global demand for petroleum products because of responses to COVID-19.
The EIA said export volumes had also decreased under OPEC agreements limiting crude oil output that were made in response to low crude oil prices and record-high production disruptions in Libya, Iran, and to a lesser extent, Venezuela.
It said, “OPEC earned an estimated $595bn in net oil export revenues in 2019, less than half of the estimated record high of $1.2tn, which was earned in 2012.
“Continued declines in revenue in 2020 could be detrimental to member countries’ fiscal budgets, which rely heavily on revenues from oil sales to import goods, fund social programmes, and support public services.”
The EIA said it expected a decline in net oil export revenue for OPEC in 2020 because of continued voluntary curtailments and low crude oil prices.
It noted that the benchmark Brent crude oil spot price fell from an annual average of $71 per barrel in 2018 to $64 per barrel in 2019.
“EIA expects Brent to average $41 per barrel in 2020, based on forecasts in EIA’s October 2020 Short-Term Energy Outlook,” it said.
The agency noted that OPEC petroleum production averaged 36.6 million barrels per day in 2018 and fell to 34.5 million bpd in 2019.
The EIA forecast that OPEC production will decline a further 3.9 million BPD to average 30.7 million BPD in 2020.
It based its OPEC revenues estimate on forecast petroleum liquids production — including crude oil, condensate, and natural gas plant liquids — and forecast values of OPEC petroleum consumption and crude oil prices.
OPEC production increased significantly last month, according to a Bloomberg survey.