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Overview
Expected impact of the crisis on the oil market
conditions (largely based on the EIU
estimations):
Oil demand
Oil supply
Oil prices
Impact on oil
market conditions: Demand
Decrease of world oil demand:
It declined by 0.2% in 2008
Is expected to decline by 0.4% in 2009
Impact on oil
market conditions: Demand
Table 1: World oil demand, 20082010
In million barrel/day
Oil consumption
2008
2009
2010
China
7.90
8.10
8.38
9.49
9.52
9.69
Total OECD
47.77
46.90
46.90
Total non-OECD
38.14
38.68
39.57
World total
85.91
85.58
86.47
China
7.98
8.17
8.41
9.24
9.16
9.24
Total OECD
47.47
45.84
45.76
Total non-OECD
38.18
38.43
39.38
World total
85.65
84.27
85.15
EIU estimates
US Department of Energy
estimates
Impact on oil
market conditions: Supply
A total cut of 4.2 million b/d in OEPCs
output:
A cut of 1.5 million b/d (November 2008)
A further cut of 2.7 million b/d (January 2009)
Impact on oil
market conditions: Supply
Table 2: World oil supply, 20082010
In million barrel/day
Oil production
2008
2009
2010
OPEC
37.18
34.87
36.12
Non-OPEC
48.98
50.29
51.23
World total
86.16
85.17
87.36
OPEC
35.71
33.78
35.44
Non-OPEC
49.75
49.76
49.95
World total
85.46
83.53
85.39
EIU estimates
US Department of Energy
estimates
Impact on oil
market conditions: Prices
The crisis has affected oil prices mainly thru
two channels:
Many operators have liquidated their positions in
the commodity markets
fall in oil prices
The severe slowdown in world demand
fall in
oil prices
Impact on oil
market conditions: Prices
Table 3: Crude oil prices, 20082010
In US dollar/barrel
Prices
2008
2009
2010
98.53
35.70
51.00
99.57
52.64
62.92
EIU estimates
West Texas Intermediate
(WTI)
US Department of Energy
estimates
WTI
2006
2007
2008
2009
2010
USA
2.9
2.8
2.0
1.1
-2.0
0.7
Japan
1.9
2.4
2.1
0.3
-0.5
0.7
Euro Area
2.0
2.9
2.6
1.1
-1.2
0.5
World
3.5
4.0
3.8
2.3
-0.4
1.5
7.5
9.1
7.4
4.9
-1.5
2.5
USA
3.4
3.2
2.9
4.0
0.3
1.0
Japan
-0.3
0.2
0.1
1.6
0.0
0.3
Euro Area
2.0
2.0
2.1
3.4
1.7
1.5
Real GDP
growth (%)
World trade
growth (%)
Goods
Inflation
Outlook
for GCC economies
A/ Fiscal balance
Expected decline in surpluses
Table 5: Budget balance
Percentage of GDP
Country
2005
2006
2007
2008
2009
2010
Bahrain
7.5
4.3
3.4
6.4
-1.6
-1.0
Kuwait
39.4
29.1
42.4
31.5
4.0
5.6
Oman
2.0
3.7
3.0
6.1
3.4
5.0
Qatar
9.2
9.7
8.0
10.9
2.3
3.6
Saudi Arabia
18.4
21.0
12.3
11.6
-2.8
-3.1
United Arab
Emirates
(UAE)
8.1
11.6
14.2
13.8
1.7
1.1
Outlook
for GCC economies
B/ Economic growth
Expected decline in growth rates
Table 6: Economic growth
Percentage change, market exchange rate weights
Country
2005
2006
2007
2008
2009
2010
Bahrain
7.9
6.7
8.1
6.1
3.0
4.3
Kuwait
11.4
6.3
4.7
8.5
4.2
5.5
Oman
5.8
7.5
5.8
6.4
3.2
6.2
Qatar
6.1
5.1
11.3
12.7
18.7
16.7
Saudi Arabia
5.5
3.2
3.4
6.1
3.0
4.6
UAE
8.2
9.4
7.6
7.9
4.0
5.6
Outlook
for GCC economies
C/ Inflation
Lower expected inflation rates
Table 7: Consumer price inflation
Percentage change
Country
2005
2006
2007
2008
2009
2010
Bahrain
2.6
2.0
3.3
7.0
4.5
3.9
Kuwait
4.1
3.0
5.5
11.7
9.0
7.3
Oman
1.2
3.0
5.9
13.5
9.6
6.0
Qatar
8.8
11.8
13.7
15.2
11.8
8.9
Saudi Arabia
0.6
2.3
4.1
9.4
4.3
3.8
UAE
12.5
13.5
13.3
14.4
7.5
8.6
Outlook
for GCC economies
D/ Current account
Moderate expected current account surpluses
Table 8: Current account
Percentage of GDP
2005
2006
2007
2008
2009
2010
GCC
27.1
27.9
22.7
25.6
8.1
10.1
Bahrain
11.0
13.8
17.2
11.3
1.1
1.9
Kuwait
42.5
50.7
42.3
39.7
19.0
19.4
Oman
16.0
14.2
5.1
12.0
0.2
2.1
Qatar
17.6
17.9
16.0
21.3
13.1
21.3
Saudi Arabia
28.8
28.0
22.5
29.1
4.3
5.3
UAE
20.9
21.4
18.3
13.9
3.7
5.1
Outlook
for GCC economies: sensitivity check
If oil prices were to stabilize at higher levels,
this would mean:
A moderate decrease in fiscal surpluses
A less severe economic slowdown
Higher current account surpluses
Conclusions
The current crisis has a particular feature: it is
accompanied with falling oil prices:
Thus significantly hurting GCC countries
Thank you