Saudi Arabia oil export revenue jumps 5%, American output in future focus

The Organization of Petroleum Exporting Countries said in its Annual Statistical Bulletin today that Saudi Arabias revenue from exports of crude oil and other petroleum products rose by 5.3% in 2012 to $336.1 billion, up from the preceding years $319.1 billion. However, income from outbound shipments surged at a much slower pace than 2011 it they jumped 49%. The countrys sales abroad of oil and products surged by 3.7% to an average of 8.42 million barrels per day in 2012.

Meanwhile, Irans income from crude exports tumbled 12% as many consumers limited purchases from the country as part from the introduced sanctions by the U.S. against the countrys nuclear program. Revenues from exports fell to $101.5 billion as shipments tumbled 14% to an average of 2.56 million barrels per day.

OPECs petroleum exports jumped by 9.2% in 2012 and totaled $1.26 trillion, up from the previous years revised $1.15 trillion. Shipments of crude and petroleum products stood at 29.6 million barrels per day and equaled 46% of global output.

However, despite the overall better last year, demand prospects for OPEC oil are not so good as increasing shale oil output in North America is boosting self-sustainability and will likely result in reduced crude imports by the U.S.

Saudi billionaire Prince Alwaleed bin Talal said in an open letter to Oil Minister Ali al-Naimi and other ministers, published via his Twitter account, the kingdom needs to reduce its reliance on crude oil and diversify its revenues as demand for OPEC oil was “in continuous decline.” He sees a threat for demand in the face of shale technology, which allowed the U.S. and Canada to exploit unconventional oil deposits that were unreachable until a few years ago.

As a result of the tougher competition, Saudi Arabia will not be able to boost its output to 15 million barrels per day as intended before the global financial crisis started and will instead remain at 12.5 million bpd. The Organization of Petroleum Exporting Countries said in a report this month that it expects demand for its oil in 2014 would to average 29.61 million bpd, down 250 000 barrels per day from 2013, as a result from increased production in the U.S.

Prince Alwaleed said: “Our country is facing a threat with the continuation of its near-complete reliance on oil, especially as 92 percent of the budget for this year depends on oil. It is necessary to diversify sources of revenue, establish a clear vision for that and start implementing it immediately.”