OPEC has been killed by this oil price cycle

[dan_s]

OPEC Revenue Down 46% in 2015 and Still Sinking

Low oil prices cost OPEC $349 billion

A report from the EIA showed OPEC’s revenues fell by nearly half from 2014 to 2015 as the group pursued a strategy of defending market share over oil prices. The EIA estimates that the members of OPEC earned about $404 billion in net oil export revenues last year, down $349 billion from 2014’s $753 billion. The 46% decline in revenues was the lowest the group has seen since 2010, according to the report.

Approximately one-third of total OPEC oil revenues went to Saudi Arabia, the group’s largest producer. The EIA estimates that OPEC’s de facto leader likely earned $130 billion in revenue last year, down from $247 billion in 2014. The net earnings included Iran, unlike in previous reports. However, Iran’s net export revenues were not adjusted for possible price discounts the country may have offered customers between late 2011 and January 2016 when international sanctions were in place. The EIA believes the Islamic Republic earned roughly $27 billion last year from oil exports.

EIA projects that OPEC net oil export revenues could fall further to about $341 billion this year, based on projects of global oil prices and OPEC production levels predicted in the EIA’s most recent Short-Term Energy Outlook. On a per capital basis, OPEC net oil export earnings are expected to decline about 17% from $606 in 2015 to $503 in 2016. < This is not even close to what they need to cover their massive entitlement programs. The "natives" are getting restless.

Lower prices have more than offset the groups increased production, which reached 32.4 MMBOPD in May. U.S. shale production and output from other parts of the globe has trended downward since the implementation of OPEC’s new policy, however, lending some support to prices along with unplanned outages in Canada and Nigeria.