Saudi oil export revenue slumps to lowest since 2021 as prices falter

Saudi Arabia faced a significant setback in its oil revenue as receipts from oil sales abroad plummeted by more than a third, hitting the lowest point since September 2021, due to a sluggish recovery in energy markets. During May, the kingdom’s oil exports registered a substantial drop to slightly over $19 billion, as reported by the General Authority for Statistics, encompassing both crude and refined products. Notably, the share of oil sales in total exports also witnessed a decline, slipping to 74% from the previous year’s nearly 81%. As the world’s largest oil exporter, Saudi Arabia experienced a windfall in 2022, benefitting from higher crude prices and production. However, this year, in response to persisting concerns over the global economy, the kingdom decided to extend its production cuts initiated earlier in 2023, aiming to bolster prices by controlling supply. Though crude oil prices saw gains in recent weeks, thanks to the impact of the production cuts, there remained apprehensions about the potential impact of higher interest rates on economic activity in the US and Europe. Brent prices averaged around $75 per barrel in May, trading at $82.61 on Tuesday. In the non-oil sector, which holds a vital role in Crown Prince Mohammed bin Salman’s plans to transform the economy, exports experienced a decline of nearly 9% year-on-year, amounting to 25 billion riyals ($6.7 billion) in May.