Saudi Arabia’s oil export revenues fell to their lowest point in over three years in August, driven down by declining crude oil prices and weak global demand.
In August 2024, the value of Saudi oil exports reached $17.4 billion (65.3 billion Saudi riyals). This marked a 15.5% decrease from $20.6 billion (77.3 billion riyals) in August 2023, according to data released by the Kingdom’s General Authority for Statistics on Thursday.
August’s revenues also dropped by 6% compared to July, making it the lowest monthly total since June 2021, based on estimates from Bloomberg.
Oil prices experienced a decline throughout August and most of September due to growing concerns about global demand, particularly in China. Although Brent crude briefly surpassed $80 per barrel in early October amid renewed tensions from the Iran-Israel conflict, prices later fell back to around $75 per barrel. Market observers continue to anticipate a response from Israel following the Iranian missile attack on October 1.
With prices remaining in the low $70s during August, Saudi oil export revenues were negatively impacted. The overall merchandise trade exports from the Kingdom also declined, with a 9.8% drop in August 2024 compared to the previous year, primarily due to the 15.5% decrease in oil exports. As a result, the proportion of oil exports compared to total exports fell from 75.1% in August 2023 to 70.3% in August 2024.
Looking ahead, Saudi Arabia’s economy and oil export revenues are expected to recover if OPEC+ follows through with its plan to reverse production cuts in December. According to a recent Reuters poll of economists, Saudi Arabia’s economy is projected to grow by 4.4% next year, up from a forecasted 1.3% growth in 2024, as OPEC+ begins to unwind its oil production cuts.
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