Saudi Arabia’s crude oil exports fell 20% in first half
Saudi Arabia was unable to ship more crude oil in the first half of the year because it voluntarily restricted production as part of the OPEC + production cut deal; however, high oil prices this year have helped the Kingdom to see stable revenues.
The Kingdom’s budget deficit narrowed sharply in the first six months of this year as the government applied more fiscal discipline and increased sources of non-oil revenue, mainly taxes.
The deficit for the first half of 2021 fell 92% from the same period last year to SR12 billion, while keeping spending at roughly the same levels.
“We expect the deficit to slide to SR 62 billion for the year as a whole, from SR 141 billion that we expected at the start of the year. This is supported by oil revenues which have benefited from oil revenues. ‘a market recovery,’ Mazen Al-Sudairi, head of research at Al-Rajhi Capital, recently told Arab News.
The Kingdom’s crude oil exports averaged 5.776 million barrels per day (bpd) in the first half of 2021, down 19.8% from 7.2 million bpd in the same period a year ago and 5.8% less than 6.129 million bpd in the second half of 2020, according to JODI data.
Likewise, average daily crude production fell in the first six months of 2021 to 8.499 million bpd or 10.9% from 9.54 million bpd during the same period of 2020. The average daily rate of production also fell 4.5% from 8.895 million bpd in the second half. from 2020.
On the other hand, the first half of 2021 saw a 17.9% year-on-year increase in average daily crude consumption at domestic refineries, which rose to 2.356 million bpd from 1.999 million bpd in the first half of 2020. and edged up 0.4%. , compared to the second half of 2020.
Oil refinery production averaged 2.423 million barrels per day in the first six months of 2021, which translates into an increase of 15.2% from the first six months of 2020 and 6.5 % from the second half of 2020. Average daily exports of petroleum products in the first half of this year also rose to 1.228 million bpd, up 28.5% and 14.3% from the first and second half 2020, accordingly.
Saudi Arabia, the world’s largest oil exporter, was hit last year by the double shock of COVID-19 and record oil prices.
The government has taken many measures to protect and stimulate the economy from the impact of the pandemic last year, which led to a swelling deficit in the second quarter, data from the Ministry of Finance showed.
This year, the economy has shown stronger signs of recovery in line with global growth, leading to increased overseas oil sales and more non-oil activity in the country.
Total state revenue in the first half of the year rose 39% to SR 453 billion, fueled by higher taxes and increased oil sales.
Oil prices this year have risen from $ 52 in January to $ 75 in July, alongside the steady increase in Saudi oil production under the OPEC + deal. The result was an 11% increase in oil revenues to SR 249 billion in the first six months of the year, the data showed.
Saudi Arabia is also seeking more trading partners under free trade agreements, as the country aims to increase the share of non-oil exports in GDP.
The target countries are China, India, Pakistan, Australia, New Zealand, Great Britain, Indonesia, the Philippines, Bangladesh, Sri Lanka and the United States.
The Kingdom aims to export services such as transport, distribution, professional and financial services, communication services, postal services as well as express mail, media, hospitality, construction and procurement, education and training, travel and tourism, environment and entertainment.
Source: Arab News