Strong oil prices and high output will push this year's oil revenues for the Organisation of Petroleum Exporting Countries to their highest level ever in nominal terms.

The 20 per cent surge in oil income since last year is the result of record prices and the highest output level in quarter of a century. This will strengthen the fiscal position of countries in the Middle East that incurred big deficits during the oil price crash in 1998. Industry analysts and officials forecast Opec's 2004 oil revenues will be about $300bn, roughly double the annual average revenues throughout most of the 1980s and 1990s.