By Velda Addison, Hart Energy

If projections pan out, Organization of Petroleum Exporting Countries’ (OPEC) net oil export revenues will continue falling this year, possibly dropping to about $380 billion, according to a report released March 31 by the U.S. Energy Information Administration (EIA).

The estimate nearly cuts in half OPEC’s net oil export revenues in 2014 of about $730 billion. In 2014, revenue also dropped from the previous year, down 11% from $824 million in 2013.

The forecast assumes the cartel’s production and exports will be at 2014 levels. It’s also important to note that the figures exclude Iran due to difficulties in estimating its revenues.

The cash crunch has been attributed to declining crude oil prices.

OPEC has been unwilling to cut production because it apparently needs the money, although its reluctance to do so is partly to blame for its predicament. Other contributing factors include slow demand and rising production in the U.S., where producers are trying to convince legislators to lift a crude oil export ban.

Of the OPEC members, de facto leader Saudi Arabia brought in the most oil export revenue in 2014—$246 billion.

“Saudi Arabia has indicated its intention to maintain its export market share rather than cut production to keep prices higher,” EIA said in the report. “In the past, Saudi Arabia often played the role of the swing producer, temporarily cutting its production to offset supply growth elsewhere or weaker global demand, or increasing its output level to make up for a supply shortfall.”

That does not appear to be the case this time, but it doesn’t mean the circumstance isn’t costing them.

The Wood Mackenzie consultancy said Saudi Arabia might offer price discounts to stay competitive and keep market share in Asia. In a news release, the consultancy pointed out that other suppliers are making inroads into the Asian market, and Saudi Arabia’s piece of the market could drop by 2 percentage points to 21% by 2020, if it keeps its existing crude oil export volume to Asia at 227 million tonnes.

“Asia is the largest market for Saudi Arabia’s crude oil exports. Asia’s share of Saudi crude exports has risen from 60% in 2006 to approximately 65% in 2014,” said Sushant Gupta, head of Asia downstream research at Wood Mackenzie. “Clearly, it is important for Saudi Arabia to protect its market share in Asia. However, competition has intensified and Asia now has more options to source crude oil supply.”

Emerging competitors include Iraq, Russia and the United Arab Emirates. Colombia, Venezuela and some countries in West Africa also could take a piece of Saudi’s market share.

In addition, crude trade flows are being altered by tight oil production growth in the U.S., which has increased heavy crude imports from Canada while reducing imports from Latin America and West Africa, he said. In turn, the shift is causing suppliers from these regions to redirect supplies.

Destination: Asia.

“Having competitive prices will be an important mechanism that Saudi Arabia would be adopting to secure its market share,” Gupta said in the release. “Other suppliers looking to position themselves in Asia will have to pay close attention to the Saudi's pricing strategy for Asia. Meanwhile, Asian refiners are set to benefit from this competition.”

The EIA projects OPEC revenues will start to bounce back in 2016. Oil export revenues are projected to reach $515 billion. That is, of course, if crude oil prices rally.

Contact the author, Velda Addison, at