UAE oil income drops by 40%

A decline in crude prices along with lower supplies depressed the UAE's oil income by more than 40 per cent in 2009 while the revenues of the other Gulf producers also fell sharply, according to official US data.

But the country's earnings appear to be recovering through 2010 as its income stood at around $11 billion (Dh40.3bn) in the first two months and oil prices are heading for nearly $10 above their 2009 average.

The figures by the Energy Information Administration (EIA) of the US Department of Energy showed the UAE's oil export earnings stood at $52bn in 2009, down by 40.2 per cent from its record income of $87bn in 2008.

EIA gave no reason for the decline, but analysts said it was a result of a 35 per cent fall in oil prices and a cut of more than 200,000 barrels per day in the UAE's crude supply in line with a collective agreement by the Organisation of Petroleum Exporting Countries (Opec) to keep oil prices firm.

Experts expect the UAE's oil revenues to rebound above $60bn in 2010 on projections that crude prices could average $70, nearly $10 above their 2009 level. The country's crude production could also edge up through 2010 as Opec might raise output for stronger global demand.

Lower oil prices and production were the main factors in the slowdown of the economies of the UAE and other Gulf nations last year, although the Emirates' fiscal balance remained in a surplus given the country's massive overseas assets, controlled mostly by the Abu Dhabi Investment Authority.

Saudi Arabia's oil income fell by 46 per cent in 2009.

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