Rising oil prices in 2018 strengthened fiscal and current-account balances, contributing to a pickup in economic growth in the Middle East, although recent crude oil production cuts are eroding some of those gains. New US sanctions have sent Iran's economy into recession as its oil production and exports decrease. IHS Global estimate that Iranian crude oil (including condensate) exports will soon be cut in half from around 1.2 million barrels/day in April. Real Gross Domestic Product (GDP) is expected to fall 4.3% in 2019. The oil price outlook is critical to expectations for the region. The global crude market is moving from surplus to deficit in response to several factors. Saudi Arabia has single-handedly fulfilled The Organisation of the Petroleum Exporting Countries (OPEC) agreed output cuts, while US sanctions are constraining the output of Iran and Venezuela. The latter's decaying infrastructure, domestic political turmoil and power blackouts are compounding production losses.
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