The economy of Brunei is overwhelmingly dependent on the production of petroleum and natural gas. Oil fields were first discovered at Seria in 1929, but production has now expanded to offshore fields. Crude-oil output in 1999 was 75 million barrels. Of minor importance to the economy is the production of rubber, pepper, and animal hides. Production of the chief food crop, rice, does not meet national needs. Local industries include cloth weaving and metalwork. Exploitation of the country’s forest reserves is increasing. The country has 1,712 km (1,064 mi) of roads, mostly along the coast. Rivers form the principal network of transportation into the interior. The chief ports are Bandar Seri Begawan, Kuala Belait, and Muara. Royal Brunei Airlines, the state-owned carrier, provides service to a number of international destinations.

petroleum and natural gas, Brunei has rich—though undeveloped—deposits of white-quartz sand. Oil was first produced in 1929, while the natural gas industry was developed after the discovery in the 1960s of large deposits. Nearly all the oil and natural gas produced in Brunei comes from offshore fields located off the western enclave. All but a small percentage of the production is exported, a small refinery supplying local needs. Oil output peaked in the late 1970s and subsequently was reduced in order to conserve reserves. Brunei's huge deposits of natural gas were intensively developed in the 1970s, including the construction of a gas liquefaction plant. As a result, export earnings from liquid natural gas have come to roughly equal those from petroleum.

This small, wealthy economy is a mixture of foreign and domestic entrepreneurship, government regulation and welfare measures, and village tradition. Exports of crude oil and natural gas account for over half of GDP. Per capita GDP is far above most other Third World countries, and substantial income from overseas investment supplements income from domestic production. The government provides for all medical services and subsidizes rice and housing. Brunei's leaders are concerned that steadily increased integration in the world economy will undermine internal social cohesion although it became a more prominent player by serving as chairman for the 2000 APEC (Asian Pacific Economic Cooperation) forum. Plans for the future include upgrading the labor force, reducing unemployment, strengthening the banking and tourist sectors, and, in general, a further widening of the economic base beyond oil and gas.