Opec’s war chest for an energy transition is shrinking

WAR was good for the Organization of the Petroleum Exporting Countries (Opec) last year. The group’s haul was the highest since 2013, according to one measure – just, as it happens, not the most meaningful measure. A deeper look at Opec’s earnings reveals structural weaknesses and helps explain the oil exporter club’s recent efforts to support prices – and why that is so important to its de facto leader, Saudi Arabia.

The Energy Information Administration publishes an annual estimate of Opec oil export revenue, with the latest showing US$888 billion for 2022, up 54 per cent from 2021 and a shade over the total for 2014, when oil prices began their mid-decade crash.

So much for nominal numbers. In real terms, Opec’s revenue was up 43 per cent from 2021 – still not bad – but down almost a fifth from 2014. Now adjust for population: At US$2,035 per capita, last year’s figure was 30 per cent below the level of 2014.