Brent oil prices fell to their lowest level during October, at about $47.17 per barrel, after having increased by the middle of the month to an average of $48.
Exporting companies are facing a major decline in revenues from crude oil exports, where Kuwait’s revenues have dropped by approximately 60%.
Former deputy chairman of the Egyptian General Petroleum Corporation (EGPC), Medhat Youssef, told Daily News Egypt that oil-exporting countries may resort to reducing their production in light of the economic pressure they face, due to the decline in revenues.
He pointed out that the price of a barrel of crude oil lost more than 55% of its value within a year as a result of the competition between exporting countries to increase their production and exports in an attempt to pressure Russia to reduce the price per barrel in world markets.
Youssef said signs of a financial crisis faced by the exporting countries have emerged in Kuwait and Saudi Arabia, as indicated by their announcements of urgent economic measures, including increasing the prices of petroleum products in local markets.
He called on the government to increase its imports of crude and petroleum products during the current period to exploit the price drops before they go back up.
The Emir of Kuwait, Sheikh Sabah Al-Ahmad Al-Jaber Al-Sabah, said the state’s revenues fell by 60% due to falling oil prices, while local public consumption continued as before.
He called for “urgent steps” to complete the economic reform efforts, reduce public consumption, and tackle corruption.
He further called on the government and the National Assembly to take urgent measures and procedures to reform the economic strategy, and search for other sources of income to make up for the revenue drop due to price decline of oil barrels.
Kuwait’s oil exports are estimated at about 1.995m barrels of crude per day to world markets, which puts it in fourth place among Arab oil exporting states in the OPEC. Its output reached 2.867m barrels of oil.
Saudi Arabia’s exports fell to 7.062m barrels of crude per day, compared to 7.153m barrels in the previous month.
Saudi Oil Minister Ali Al-Naimi said his country is considering raising energy prices, such as gasoline, which would mark one of the most major economic reforms in the Kingdom for many years.