On Thursday, the InfoTech news outlet published an analysis which shows the power balance in the global energy market is on course to shift markedly due to the BRICS group of nations, according to calculations based on OPEC oil exports and production data from 2022.
The calculations show that after the alliance expands following the addition of the six new nations it has admitted to its membership, it will be in control of almost half of the world’s oil production and reserves.
Currently the alliance is made up of Brazil, Russia, India, China, and South Africa. However the alliance announced at its summit in Johannesburg, South Africa this week, that it will be officially admitting Argentina, Egypt, Ethiopia, Iran, Saudi Arabia, and the United Arab Emirates to its ranks in January of 2024.
The report noted the group will enormously increase its influence in the global oil market with the inclusion of new members Saudi Arabia, the UAE, and Iran. When combined with Russia and Brazil, which are already members, the alliance will control 39% of the world’s total oil exports, or 17.1 million barrels per day (bpd). In total, the new expanded alliance of 11 nations will produce about 47.6% of total global oil production, data shows.
As for global oil reserves, the alliance will control almost half of the world’s total reserves, at 719.5 billion barrels out of 1.6 trillion. Analysts note that Venezuela, which recently applied for membership, would increase the alliance’s control over global reserves to about 65.4%, if it is admitted. By way of comparison, currently the G7 group of leading economies, comprised of the US, UK, Germany, Italy, Canada, France, and Japan, only control about 3.9% of known crude reserves.
Experts note that with BRICS expanding into the Gulf countries, the US will lose even more influence over the global oil market.
Economist Philip Pilkington wrote in an article in the British portal UnHerd, “Saudi Arabia and the UAE joining is… extremely significant. The United States used to rely on the Gulf monarchies, especially Saudi Arabia, to exert control over the oil price. With their accession to BRICS, it seems likely that America has lost any control it had over oil prices for the foreseeable future.”
Pilkington noted, with its entrance into BRICS, Iran’s economic isolation, and the ability of the United States to influence it through sanctions will now be greatly diminished.
He said, “Given that the country is the world’s eighth largest oil producer and possesses the third largest proven oil reserves, this is a substantial economic and geopolitical development.”
