Strong oil prices boosted the combined income of Gulf hydrocarbon producers by a whopping $182 billion in 2011 and the increase allowed them to nearly triple their fiscal surplus, according to a regional bank study.
From around $425 billion in 2010, the collective oil revenue of the six-nation Gulf Cooperation Council (GCC) surged to $607 billion in 2010, showed the study by Qatar National Bank (QNB), the Gulf’s largest bank by assets.
The increase sharply widened their fiscal surplus to about $138 billion in 2011 from $43.6 billion in 2010, the study showed.
The balance sharply expanded despite an increase in actual public spending from around $382 billion to $468 billion.
The 2011 surplus was the second largest positive balance recorded by the 31-year-old economic, defence and political Gulf alliance after the record surplus of nearly $229 billion in 2008, the report said.
The massive increase in their revenue was a result of a sharp rise in oil prices to a record high average of about $109 a barrel in 2011 from $78.7 in 2010.
The report expected the surplus to plunge to nearly $52 billion in 2012 because of an expected decline in oil export earnings to around $563 billion and an increase in actual expenditure to nearly $511 billion. It projected the surplus to rebound slightly to around $57 billion in 2013.
QNB gave no breakdown for the 2011 surplus but official data showed Saudi Arabia, the world’s oil powerhouse, recorded the largest positive fiscal balance of around SR306 billion ($81.6 billion).
It was much higher than the SR97 billion ($25.8 billion) surplus achieved in 2010 and in contrast with the 2009 deficit of SR87 billion ($23.4 billion).
In the UAE, IMF figures showed the fiscal balance reverted to a surplus of Dh38.5 billion last year from an actual shortfall of Dh22.9 billion in 2010.
QNB figures showed higher oil prices expanded the GCC’s combined GDP by 28.1 per cent to $1,383 billion in current prices last year from around $1,080 billion in 2010. It expected GDP to edge up to about $1,392 billion in 2012 and gain more than $100 billion to reach a record $1,495 billion in 2013.