Opec income to soar by more than $180bn

Higher oil prices will likely boost the income of the Organisation of Petroleum Exporting Countries (Opec) by more than $180 billion (Dh661bn) in 2010 and earnings could swell further in 2011, official US data showed on Monday.

The 12-nation Opec, which produces just under 40 per cent of the world’s oil supply, earned nearly $429bn in the first seven months of 2010, more than $100bn above its revenues in the same period of 2009, showed the figures by the Energy Information Administration (EIA) of the US Energy Department.

Opec's income stood at about $571bn in 2009 and it is projected to surge to nearly $752bn this year, an increase of $181bn, EIA said.

The earnings could rise to nearly $821bn in 2011 as crude price will likely remain strong and OPEC could hike output for higher global demand.

Despite the increase, the income this year and in 2011 will be far lower than the record high income of about $966bn achieved in 2008, when crude prices climbed to their highest average of about $147 a barrel.

EIA gave no forecasts on prices and Opec's output but according to the Institute of International Finance and other estimates, crude prices could average above $70 in 2010 and $80 in 2011 compared with nearly $60 in 2009.

Opec producers could also be prompted by an expected recovery in demand to hike output, which was officially cut by 4.2 million bpd at the start of 2009 following a sharp fall in demand because of the global fiscal turbulence.

EIA had previously projected Opec's 2010 income at below $600bn but has massively revised up its forecasts apparently because it expects crude prices to further improve and the Group’s production to be raised.

Opec, which controls more than 70 per cent of the global oil resources, netted its highest ever income in 2008 after prices hit an all time high and the cartel was pumping at one of its highest output levels.

A breakdown showed Saudi Arabia was the largest earner in the first seven months of 2010 as the Gulf kingdom pumps close to a third of Opec's production. EIA put its income at around $116bn.

Iran, which controls the world’s second largest oil deposits after Saudi Arabia, was number two, with an income of about $41 billion. It was followed by the UAE and Nigeria, which earned $38bn each in the first seven months of 2010.

Kuwait and Angola earned about $33bn each while the income was estimated at nearly $31bn in Algeria, $28bn in conflict-battered Iraq, $25bn in Libya, $22bn in Venezuela, $20bn in Qatar, and $4bn in Ecuador, the smallest Opec producer.

In the first half of 2010, the income of all Opec members sharply increased on higher oil prices, which averaged nearly $70 a barrel.

The price rise lifted the UAE’s oil export revenues by nearly $12bn in the while Opec earned more than $140bn in extra income.

From around $21bn in the first half of 2009, the UAE’s oil export revenue surged to nearly $33bn in the first half of 2010, EIA’s figures showed.

Saudi Arabia, which controls nearly a quarter of the recoverable global oil resources, saw its income leap by nearly 64 per cent to $100bn in the first half of this year from $61bn in the same period of 2009.

Kuwait, another Gulf oil heavyweight, also recorded a sharp rise in its earnings, which swelled to $29bn from $20bn in the same period.

The income of the other Gulf oil producers soared from $10 billion to $17bn in Qatar, to $35bn from $22bn in Iran and to around $24bn from $16bn in conflict-battered Iraq, which is not included in Opec's quota system.

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