Saudi Arabia earns over $ 1 tn from oil in 40 years

Dec 16, 2003 01:00 AM

Saudi Arabia has netted more than $ 1 tn from the sale of over 90 bn barrels of oil since it began major commercial supplies 40 years ago, according to official figures. The world's dominant oil power has pumped 90.9 bn barrels of crude oil between 1962-2002 and output is set to climb to more than 94 bn barrels at the end of this year, showed the figures by the Saudi Ministry of Oil.
The supplies fetched the Gulf Kingdom a staggering 3.98 tn Saudi riyals ($ 1.06 tn) and the cumulative revenues are projected to grow by around $ 75 bn this year.

The state-owned producer Aramco, which controls the Kingdom's oil and gas sector, began production at a modest rate of around 1.6 mm bpd in 1962 and output started to climb steadily in the following years to peak at 9.9 mm bpd in 1980. After 1980, production fluctuated violently as the Kingdom had to play the role of a swing producer to cushion the impact of growing supplies from other areas.
Theoretically, such massive production should have slashed the Kingdom's underground crude oil reserves, which were estimated at around 56.8 bn barrels in 1962. But in effect, the reserves were massively revised up to reach around 260 bn barrels at the end of 2002, according to the Ministry's report.

Experts said the increase in the reserves was a result of an immense exploration programme and the introduction of advanced technology that could reach deeper layers. The increase enabled Saudi Arabia to control more than a quarter of the global recoverable oil wealth and to play a decisive role in the world market by hiking production when prices surge and lowering supplies when they plunge.
The Kingdom's role as a residual producer was underscored during recurrent price and production wars during the 1980s, when it was forced to cut supplies to only 3.17 mm bpd in 1985 from more than 9 mm bpd three years earlier. In 1990, when Iraq invaded Kuwait and deprived the global market of more than 4 mm bpd, Saudi Arabia, the UAE and other major producers quicklylifted output to make up for the loss and prevent a swift upward trend in prices.

From 56.8 bn barrels, Saudi Arabia's extractable crude oil deposits soared to 103 bn barrels in 1974 and continued their climb to reach 167 bn barrels in 1986. In 1987, they were massively revised up to 252 bn barrels after officials announced huge discoveries in some areas and more underground layers were reached.
The reserves are now officially estimated at around 260 bn barrels but Saudi oil industry analysts believe more crude are in place in hitherto inaccessible areas. It has also extended nearly $ 80 bn in financial aid to Arab and other developing countries but the aid has sharply slackened because of festering fiscal woes.

In current prices, Saudi Arabia's oil revenues this year are one of the highest in its financial history. But in real 1970 dollar price, the income is less than a third of its 1980 level and the problem is complicated by inflation, weakening US dollar and the Kingdom's growing development needs as a result of its surging population.
A breakdown by Aramco showed Saudi Arabia produced around 599 mm barrels in 1962 and output peaked at 3.62 bn barrels in 1980. It began slowing down in the following years to reach 1.1 bn barrels in 1985 before recovering to more than 3 bn barrels in 1998 and nearly 2.58 bn barrels last year.

Source: Al Nisr Publishing
Alexander's Commentary

Change of face - change of phase

In the period of July 20 till August 3, 2015, Alexander will be out of the office and the site will not or only irreg

read more ...
« August 2019 »
August
MoTuWeThFrSaSu
1 2 3 4
5 6 7 8 9 10 11
12 13 14 15 16 17 18
19 20 21 22 23 24 25
26 27 28 29 30 31

Register to announce Your Event

View All Events