Adnoc oil revenues slip on global trend

Abu Dhabi: The official selling price (OSP) of Abu Dhabi's crude oil grades averaged $101.52 a barrel between January and November, 5.05 per cent lower than the January-October average of $106.65 a barrel, latest data extrapolated from the Abu Dhabi National Oil Company (Adnoc) reveals.

Adnoc's crude grade prices have been coming down in line with the steadily falling international oil prices due to the global financial crisis which has triggered fears of a long global recession.

The average OSP of Abu Dhabi crude oil grades -Murban, Upper Zakum, Lower Zakum and Umm Shaif - plunged to $50.21 a barrel in November from $68.1 a barrel in October.

Abu Dhabi accounts for nearly 94 per cent to the UAE's oil output.

Energy experts say because of Abu Dhabi's relatively lower oil production costs and high cash balance, the UAE is in a better position to come to grips with a fast-changing global economic scenario than some of the other oil producing countries in the Middle East.

On the back of skyrocketing oil prices in the first seven months of the year, they say, the UAE's oil export revenue is expected to cross the $100 billion mark for 2008, which would ensure smooth cash flows for development projects.

"I would imagine Abu Dhabi doesn't have a lot of external debt compared with some of the other oil producers so it would seem, it's better prepared for a crisis," Dalton Garis, associate professor of economics at the Petroleum Institute in Abu Dhabi said.

However, international oil prices remaining below $50 per barrel in the long run will have a negative impact on the UAE's oil revenues, say experts.