STORY Sep 12, 2019

Oil’s contribution to Middle Eastern economies has fluctuated in recent years

Oil rents in the Middle East and North Africa hit a low in 2016, accounting for less than 12 percent of GDP. Revenues above the cost of extracting natural resources such as oil, coal and natural gas are termed economic “rents”. They recovered slightly in 2017 due to OPEC’s decision to limit production of oil. In the Middle East and North Africa economies are driven partly by the extraction of oil and natural gas, and the region’s oil rents, as a share of GDP, have fluctuated as demand for oil and oil prices have varied.

A large dip in oil rents worldwide occurred in 2009 but, despite economic recovery, the demand for oil among the largest oil importers, such as China, slowed after 2010. Despite fluctuations oil rents remain important for MENA countries: for example, in Kuwait and Iraq they account for over 40 percent of GDP. Yemen’s oil rents have fallen dramatically over the last ten years where continuing conflict has thwarted oil production and export.