Venezuela Surpasses Saudi Arabia as World's Largest Oil Reserves Holder

Strategic Insights -

Venezuela's proven crude oil reserves exceeded those of Saudi Arabia in 2010, making it the world's largest oil reserves holder, according to the Organization of Petroleum Exporting Countries (OPEC). The boost in reserves, combined with increases from Iran and Iraq, may empower OPEC members who favor a defense of high prices. However, doubts remain over the economic viability of Venezuela's heavy oil discoveries.

Key Takeaways:

  • Venezuela's proven crude oil reserves reached 296.5 billion barrels in 2010, surpassing Saudi Arabia's 264.5 billion barrels.
  • The upgrade in reserves is due to discoveries in the Orinoco Belt, which is challenging and expensive to extract.
  • Venezuela, along with Iran and Iraq, refused to endorse a Saudi-led push to hike output at an OPEC meeting in June 2010.
  • Analysts question the economic viability of Venezuela's reserves additions, citing the difficulty and expense of extracting heavy and extra-heavy oil.
  • The International Energy Agency (IEA) revised its method for calculating Venezuela's oil-production figures, bringing its estimates closer to those of Caracas.
  • Iran's oil exports to Europe rose 34.5% in 2010, despite EU sanctions, which may vindicate Iran's claims that sanctions are not crippling the development of its oil and gas industry.
  • Nigerian oil industry saw a recovery in 2010, with 17 more rigs active and 437 additional producing wells, following a successful amnesty for militants in 2009.
  • OPEC members strongly benefited from higher oil prices in 2010, with the total value of their petroleum exports up 27.2% to $745.1 billion and their overall gross domestic product rising 11.2% to $2,325 billion.

Statistics:

  • Venezuela's proven crude oil reserves: 296.5 billion barrels in 2010.
  • Saudi Arabia's proven crude oil reserves: 264.5 billion barrels in 2010.
  • Iran's proven crude oil reserves: 151.2 billion barrels in 2010, an increase of 10.3% from 2009.
  • Iraq's proven crude oil reserves: 143.1 billion barrels in 2010, an increase of 24.4% from 2009.
  • Iranian oil exports to Europe: 764,000 barrels per day on average in 2010, a 34.5% increase from 2009.
  • Total value of OPEC members' petroleum exports: $745.1 billion in 2010, a 27.2% increase from 2009.
  • OPEC members' overall gross domestic product: $2,325 billion in 2010, an 11.2% increase from 2009.

Sources:

  • Dow Jones Commodities News via Comtex, "Venezuela now world's largest oil reserves holder" (July 18, 2011)
  • Dow Jones NewsWires, "Venezuela Surpasses Saudi Arabia as World's Largest Oil Reserves Holder" (July 18, 2011) by Benoit Faucon.