What are the countries with oil-based economies?
Oil is one of the most important (perhaps even the most vital) source of energy in the world today. The growth and development of many countries across the globe is fueled by oil. The industrial development of many nations depends on the oil that is produced or imported. While there are concentrated attempts to move to cleaner, greener, and more renewable energy sources, the supremacy of oil remains supreme. Oil exports from the very foundation of the economies of many nations. Before we get to them, however, let us take a look at the top oil exporting nations.
As of January 2018, Saudi Arabia remained the world’s largest oil exporter, with exports amounting to 9.3 million barrels a day. The United States came in second with 8.3 million barrels a day and was followed by Russia which exports about 7.4 million barrels a day. According to studies, it is likely that by 2019, the US will have overtaken Saudi Arabia as the top oil exporter in the world.
Top Oil Producing Countries of the World
Going by 2017 production figures, the US tops the list of oil producing countries. The country produced 14.72 million barrels each day. This was followed by Russia which produced 11.33 million barrels per day. Then comes Saudi Arabia with 9.96 million barrels a day. This was followed by Canada which produced 4.8 million barrels a day and Iraq with 4.47 million barrels a day. The remaining countries that featured on the top oil producing nations list were Iran (3.8 million barrels a day), China (3.77 million barrels a day), UAE (2.93 million barrels a day), Brazil (2.89 million barrels a day), Kuwait (2.71 million barrels a day), Venezuela (1.97 million barrels a day), and Norway (1.90 million barrels a day).
When we speak of economies dependent on oil, we are not referring to oil production or even exports. The US, for example, is one of the top oil producers, but the economy is not oil-based. By oil-based economy, we are referring to national economies in which the major revenue comes from oil exports. This could also mean that a great share of the national GDP depends on oil. To understand which countries are most dependent on oil for economic growth we refer to World Bank data from the year 2012. According to this data the top oil dependent economies are –
- Saudi Arabia
The top two countries from this list, Kuwait and Libya, reported about 45% (of GDP) dependence on oil. These are the countries that are also greatly impacted by the fall in oil prices over the recent years.
Kuwait is heavily dependent on oil export revenues to keep its GDP buoyant. So much so, that the Kuwaiti economy is referred to as a single-industry economy. The fall in oil prices has also adversely affected the inflow of foreign investments further dampening economic growth.
Libya, the other country on top of the list, is fighting a battle on many fronts. Oil export revenues not only account for almost half the GDP but also make up 95 % of the government’s revenue. With oil prices affecting these revenues, the political instability in the country is only exacerbated.
Saudi Arabia, while a relatively more diverse economy, is still greatly dependent on oil export revenues which account for a little less than 45 % of the GDP. About 90 % of the total export revenue of the country comes from oil and petroleum products. In 2016, the kingdom committed to reduce its dependency on oil calling its economy ‘oil-addicted.’ The country unveiled its ambitious ‘Saudi Vision 2030,’ an action plan that lays out the blueprint for a complete overhaul of its economic structure. One of the major highlights of this vision is the increased emphasis on diversification of the economy and a move from dependency on oil. Saudi Arabia had also resolved to reduce its own dependence on oil and increase its nuclear power generation capability to meet domestic demand.
Other countries that have borne the brunt of falling crude prices over the past years include Venezuela, Angola, and Russia. The countries that have profited from the fall in prices include developing nations such as India and South Korea.