OPEC: Nigeria, Other Members Lost $240bn to Collapse in Oil Demand in 2020

The Organisation of Petroleum Exporting Countries (OPEC) lost over $240 billion last year,  following the collapse in demand and prices due to the Covid-19 pandemic, the cartel’s Annual Statistical Bulletin (ASB) 2021, released yesterday showed.

The total value of OPEC’s petroleum exports plummeted to $321 billion in 2020, compared to $562 billion in 2019, according to the data, as demand as well as prices took a hit and countries began to embark on lockdowns and place travel restrictions.

Shipments fell by 12.4 per cent even as OPEC members’ petroleum exports, which include crude oil and oil products, dropped significantly, decreasing by 42.9 per cent in 2020.

OPEC member countries in 2020 exported an average of 19.70 million barrels per day (bpd) of crude oil, marking a sharp decline of 2.78 million bpd, by 12.4 per cent from 2019, while all member countries exported less crude except for Equatorial Guinea and the United Arab Emirates (UAE), where they increased marginally.

According to the OPEC document, the cartels reference basket averaged $41.47 a barrel in nominal terms during 2020, down from $64.04 per barrel in 2019, which was a massive decrease of $22.57 a barrel, or 35.2 per cent, while the volatility level was $12.55 a barrel, or 30.3 per cent, relative to the yearly average.

As a result, the value of OPEC’s oil exports, the main, and in many cases indispensable, part of OPEC members’ government revenues dramatically fell last year compared to 2019.

Crude oil export volumes also slumped to an average of 19.70 million bpd in 2020, a sharp decrease of 12.4 percent compared to 2019, the fourth consecutive annual decline in OPEC’s crude oil exports.

However, as in previous years, most of OPEC’s crude oil, roughly 73.2 per cent of exports, went to Asia, particularly China and India.

The ASB offers detailed and comprehensive data on several aspects of the global petroleum industry, including production, demand, imports and exports, as well as exploration and transportation activities and contains key statistical data on oil and natural gas activities in each of OPEC’s 13 member countries.

In total, the statistical bulletin showed that world crude oil production declined in 2020 by 6.15 million barrels/day  or 8.2 per cent, as compared to 2019, to average 69.09 mb/d, marking a historical year on-year drop after the outbreak of the COVID-19 pandemic.

Furthermore, OPEC crude oil production declined sharply year-on year by 3.72 mb/d, or 12.7 per cent, while crude production by non OPEC countries fell by 2.43 mb/d, or 5.3 per cent.

“With an average of 90.73 mb/d in 2020, world oil demand was heavily impacted by the COVID-19 pandemic and fell by a historic 9.30 mb/d y-o-y, while demand in OPEC member countries was sluggish in 2020, losing 8.2 per cent y-o-y.

Distillates and gasoline accounted for around 55.1 per cent of 2020 world oil demand with a steep downward trend amid Covid-19 containment measures, according to the document.

Member countries exported an average of 19.70 mb/d of crude oil in the month under review, a sharp decrease of about 2.78 mb/d, or 12.4 per cent, compared to 2019.

Following the pattern in previous years, the bulk of crude oil from OPEC member countries’ 14.43 mb/d or 73.2 per cent was exported to Asia, particularly to China and India.

The ASB indicated that exports of petroleum products from OPEC member countries averaged 3.48 mb/d during 2020, down by around 0.40 mb/d, or 10.4 per cent, compared to 2019 imports of petroleum products by OPEC member countries averaged at 1.52 mb/d in 2020, roughly 0.17 mb/d, or 9.8 per cent, lower than in 2019.

But world proven crude oil reserves stood at 1.549 trillion barrels at the end of 2020, increasing by 0.2 per cent from the level of 1.546 billion recorded at the end of 2019.

In the same vein  proven crude oil reserves in OPEC member countries increased by 0.3 per cent to 1.237 at the end of 2020, following a firm increase during 2019.

Also, world refinery capacity shrank by 0.3 million barrels to stand at 101.1 mb/cd during 2020, but China and other Asia and the Middle East, recorded refining capacity additions.

Speaking at the launch, OPEC Secretary General, Dr Sanusi Barkindo, noted that data will continue to stay at the core of OPEC’s ongoing activities in the global energy markets as the organisation continues to make highly responsible and effective decisions based predominantly on accurate, timely and transparent data and statistics.

“Additionally, OPEC continues to collaborate with the Joint Organisations Data Initiative (JODI), to ensure that accurate, timely and transparent data flows are constantly being optimised for the benefit of our joint efforts and for the wider oil industry.

“These initiatives all point to OPEC’s ongoing commitment to 100 per cent transparency in all that we do. The credibility of the organisation has indeed been further enhanced thanks to these endeavours,” he said.

Emmanuel Addeh in Abuja

Follow us on: