Opec to rake in $900 billion in 2008

The Organization of Petroleum Exporting Countries (Opec) will earn more than $900 billion in oil exports this year as the average price for the group's crude surpasses $100 a barrel for the first time.

Opec members may earn $927 billion from net oil exports in 2008, the US government's Energy Information Administration (EIA) has said, raising a January estimate by 9 per cent. 

OIL EXPORT REVENUE With the average price of a barrel of crude oil surpassing $100, Opec members are poised to bring in $927 bn in '08
Opec country	Oil export revenues  2007, in billions	Per capita oil export revenues
Saudi Arabia	$193.80	$7,012
UAE	$63.00	$23,817
Iran	$57.30	$876
Nigeria	$55.30	$409
Kuwait	$54.30	$21,619
Algeria	$50.60	$1,516
Venezuela	$48.30	$1,850
Angola	$43.80	$3,566
Libya	$40.60	$6,712
Iraq	$37.80	$1,372
Qatar	$26.60	$29,235
Ecuador	$7.80	$565
Indonesia	-$4.20	-$18
Opec	$674.70	$1,147

US crude futures have traded above $100 for most of the past three weeks and reached a record $111 on March 13. Opec's so-called basket price is cheaper than those futures, because Opec oil is generally heavier and lower quality. Opec pumps more than 40 per cent of the world's oil.

"Our forecast is oil at $140 by the end of 2011," Mark Mathias, chief executive officer at fund manager Dawnay Day Quantum in London, said. Among non-Opec nations, "production is going down because fields are old and they can't produce much more," he said.

Oil prices have rallied against a backdrop of a US economic slowdown because Asia continues to drive consumption. Adding to the gains are speculative investments in commodities as a hedge against inflation, as the value of the US dollar declines.

$1,146 per person
Opec's net oil export revenue last year was $676 billion, according to EIA. Saudi Arabia, the world's largest exporter, earned $194 billion, or 29 per cent of the group total.

Collectively, Opec earned $1,146 for each member of its population last year, according to EIA estimates.

A price of between $60 and $70 a barrel may now act as a floor for oil because renewable energy sources were competitive at those levels, Saudi Arabian Oil Minister Ali al-Naimi said at an Opec ministers meeting in Vienna on March 5.

In the past year, the Opec basket has averaged $3.44 less than the benchmark US oil futures contract traded on the New York Mercantile Exchange. The basket has gained 73 per cent in the past year, rising from $58.20 a barrel on March 9, 2007.

Opec ministers last week ignored calls by US President George W Bush to increase output in order to help the global economy and, instead, left production targets unchanged at the meeting, giving 12 of its 13 members a combined quota of 29.67 million barrels a day.

Some members, including Iran, had argued that a supply cut might be needed to offset an anticipated reduction in world demand.

'Beyond fundamentals'
Opec crude output fell 120,000 barrels a day in February to 32.1 million barrels a day, the Paris-based International Energy Agency (IEA) estimated in a monthly report recently.

Oil prices had gone "beyond fundamentals" and were being pushed higher by speculation and the weakening US dollar, Venezuelan Energy and Oil Minister Rafael Ramirez has said.

IEA reduced its this week forecast for 2008 global demand by 80,000 barrels to 87.54 million a day as high prices and weaker economic growth have "weighed down" demand from the world's richest economies. US oil demand will contract by 0.1 per cent, or 140,000 barrels a day, this year.

Demand from the West Asia and Asia is expected to remain strong with each region adding about 400,000 barrels to daily demand this year, according to IEA projections.

Opec comprises Algeria, Angola, Ecuador, Indonesia, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, the United Arab Emirates and Venezuela.