Business & Economy
Written By: Faisal Darem
Article Date: Dec 26, 2009 - 11:00:58 AM
Yemeni crude oil experts decreased to $1.5 billion during the fiscal period from January –October of 2009, compared with $4.2 billion during the same period of 2008, a decrease of $2.7 billion, the Central Bank of Yemen reported.
The statement revealed that the record decline in oil returns was accompanied by the government’s ebbing share of total oil exports during this period, from 38.8 million barrels to 24.5 million barrels.
A report issued by CBY attribute the decline to the decrease of Yemen oil production in conjunction with the decrease of oil prices globally.
The report showed that Yemeni crude oil prices rate averaged $60 per barrel during the last ten months, tumbling well below the $107 prices of 2008.
There has been a unilateral increase of local consumption of oil by 2 million barrels during the last ten months.
The government intends to support investments in the non-oil export field in response to local and international requests for diversifying. The non-oil exports are expected to balance the declining returns of crude oil exports caused by the global financial crisis.
The Yemeni government’s share from the crude oil exports represents 70 percent of the general budget’s resources, 92 percent of Yemen’s exports and 30 percent of the gross domestic product (GDP).
Economic experts warn against national dependence on oil and emphasize the necessity of financing development projects in Yemen. Dr. Taha al-Fusail, an economic expert, confirmed, “Oil proceeds still constitute approximately 75 percent of the public budget, which form problem for Yemeni economy. I advice the government to work on diversifying the resources of revenue and develop non-oil sectors, which currently form just 8 percent of exports for Yemen, whereas oil exports form 92 percent.” Yemeni economic dependence on oil revenue, roughly 75 percent of the national income, is the main problem facing Yemeni development in general, experts say.
• Yemen government seeks $ 11 billion from donors
• Indonesia’s Medco Energi buys RIL’s stake in Yemen oil block
• Counterfeit currency enters money market in Yemen
• Yemen Ministry of Planning reviews emergency fund
• Yemen raises capital of the Reconstruction and Development Bank