Oil in Global Economy Series: Bahrain discovers largest oil reserve in its history

After almost 90 years, Bahrain has made a major oil discovery, which is reportedly largest in its history. On Sunday, the country’s official news agency reported that highly significant quantities of oil and gas have been discovered off its west coast. Bahraini Oil Minister Shaikh Mohamed bin Khalifa al-Khalifa said that the initial analysis demonstrates the find is at substantial levels, capable of supporting the long-term extraction of tight oil and deep gas.

The find could significantly alter the regional politics for Bahrain which has long been sandwiched between two mega-producing neighbors, Saudi Arabia and the United Arab Emirates. Bahrain is currently the smallest oil producer in the region with a proven reserve of just 125 million barrels of crude oil. It receives revenues from two oil fields, the onshore Awali field, and the onshore Abu Safah. It currently splits revenue from the latter with Saudi Arabia under a 1958 agreement. Awali field produces around 45,000 barrels per day, and Abu Safah produces around 300,000 barrels per day.