Crude prices have started the…
Coming off the news of…
Angola has become the latest OPEC member to announce the beginning of production cuts as part of the cartel’s deal to curtail production in a bid to lift oil prices.
Angola’s state-run company Sonangol has said that it had cut crude production by 78,000 bpd to 1.673 million bpd as part of the OPEC agreement.
Angola, whose economy has heavily suffered from the oil price bust, is now complying with the OPEC deal, hoping that prices will go up. Oil output and supporting activities make up around 45 percent of Angola’s GDP, and oil accounts for more than 95 percent of the country’s exports, OPEC’s facts and figures show.
With the low oil prices battering state revenues, however, the International Monetary Fund (IMF) expects that Angola’s GDP did not rise at all in 2016, and will tick up 1.5 percent in 2017, while consumer prices are expected to have surged by 33.7 percent last year and to rise by 38.3 percent this year.
State oil company Sonangol has also felt the weight of the oil price slump, to the point that employees have recently complained that they were not being provided basic washroom supplies.
But it seems that Angola is honoring—at least for now—its commitment to start cutting oil output.
Related: Will Natural Gas Go On Another Run In 2017?
On Friday, Kuwait said that it lowered production for January as part of the deal, and statements and reports suggest that Saudi Arabia, Iraq and Venezuela are also cutting their respective output.
OPEC’s latest production figures show that in the second and third quarter of 2016, Angola was Africa’s largest oil producer, overtaking Nigeria which had to cope with militant attacks in the Niger Delta. In November 2016, OPEC’s secondary sources put Nigeria and Angola’s output at 1.692 million bpd each, with Angolan and Nigerian production rising the most from October. But while Nigeria is exempt from OPEC cuts, Angola has pledged to cut and has started reducing supply.
By Tsvetana Paraskova for Oilprice.com
More Top Reads From Oilprice.com:
Tsvetana is a writer for the U.S.-based Divergente LLC consulting firm with over a decade of experience writing for news outlets such as iNVEZZ and…