The Gulf states are experiencing low demand for oil, new lookup reveals

The Gulf states are experiencing low demand for oil, new lookup reveals. The economies of the six-member Gulf Cooperation Council will develop this 12 months by half of 2022 as oil revenues are hit by an predicted moderate international slowdown, in accordance to the median view of a Reuters ballot of economists.

Crude oil charges, a key driver of Gulf economies, have fallen by extra than a 3rd from final 12 months’s highs and had been predicted to stay underneath strain this 12 months amid fears of a recession in important economies that may weaken demand.

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Aggregate progress inside the six GCC economies was forecast to common 3.3 percentage and a pair of.8 percentage this 12 months and subsequent, respectively, the 9-23 ballot confirmed. January, down from 4.2 percentage and three.3 percentage inside the preceding ballot.

“The outlook for 2023 is more cautious given the weaker external environment, although the GCC is likely to continue to outperform many developed economies in terms of GDP growth,” wrote Khatija Haque, head of lookup and chief economist at Emirates NBD.

“While growth in oil and gas production is expected to slow this year, continued investment to increase production capacity in the region should see the sector contribute positively to overall GDP again in 2023.”

Brent crude is predicted to common $89.37 a barrel in 2023, almost 4.6 percentage decrease than the $93.65 consensus in a November survey and decrease than a median of $99 a barrel seen final 12 months, a separate Reuters confirmed -measurement.

Saudi Arabia, the area’s largest financial system and largest crude oil exporter, was predicted to develop 3.4 percentage this 12 months and three.1 percentage in 2024, barely higher than the area as an entire. The financial system grew at a report tempo of 8.8 percentage in 2022.

Economic progress inside the United Arab Emirates was predicted to be 3.3 percentage this 12 months, down from 6.4 percentage final 12 months.

Among different Gulf nations – Qatar, Oman and Bahrain – progress was predicted at 2.4 percentage – 2.7 percentage for 2023. Kuwait was seen developing at 1.7 percentage.

Despite decrease oil GDP progress, non-oil progress was predicted to stay strong in 2023, economists stated inside the survey.

Analysts predicted continued existing account surpluses for the primary Gulf economies founded on comparatively excessive oil charges.

Saudi Arabia, the United Arab Emirates, Qatar and Kuwait had been forecast to see double-digit progress in existing account surpluses in 2023, with Oman and Bahrain in single digits.

The inflation outlook was modest however various, with the bottom in Oman at 1.9 percentage and the very best at 3.1 percentage inside the UAE.

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