OPEC Chasm of Doom
Comment of the Day

June 20 2016

Commentary by David Fuller

OPEC Chasm of Doom

Here is the opening of this informative article from Bloomberg:

OPEC's members are divided by many things: language; size; politics; sometimes outright war.

And money. Don't forget money.

If you want to understand why OPEC has responded to its current crisis with all the cohesion of cat herding, some numbers in the Energy Information Administration's "OPEC Revenue Fact Sheet," published on Tuesday, provide some important clues. First up, estimated revenue, adjusted for inflation:

Tight Oil

OPEC's real net oil export revenue is expected to be the lowest since 2003

The estimate for this year, $337 billion in real terms, is barely a third of 2012's peak -- and, uncannily, exactly the same as the consensus forecast for the combined revenue of Exxon Mobil and Chevron in 2016. Of course, those two only have to pay their employees, creditors and shareholders. OPEC's members have about 700 million people to answer to, roughly double the amount in 1980. So, on a per capita basis, those numbers look worse:

David Fuller's view

Note the charts in this article, including: “The gap between OPEC’s haves and have-nots in terms of oil export revenue.  

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