Special Feature: Fiscal revenues from non-renewable natural resources in Latin America and the Caribbean

Global oil markets stabilised to some extent in 2019 following volatility in the fourth quarter of 2018 related to significant over-supply. In December 2018, the members of OPEC and allied oil-producing countries – most notably the Russian Federation – committed to reducing their overall output volume by a combined 1.2 million barrels per day (0.8 million for OPEC members) for the first half of 2019. The accord was largely successful and overall world liquid fuels production slowed markedly in the first quarter of 2019 (). Crude oil spot prices rallied as the market moved to greater equilibrium during the first months of the year. Nevertheless, prices again trended lower in May on the back of weakening macroeconomic fundamentals, rising trade tensions between China and the United States and a build-up of crude oil stockpiles in the United States. In response, OPEC and allied exporters agreed in July to extend crude oil production cuts until 2020. These trends notwithstanding, oil consumption jumped in the second half of the year, largely bolstered by record crude oil imports in China as several new mega-refineries came online. Despite the up-tick registered in the fourth quarter, annual average crude oil spot prices fell for the year, with Brent down 10% (from USD 71.1 per barrel to USD 64.0) and Western Texas Intermediate (WTI) declining by 12% (from USD 64.8 per barrel to USD 57.0).