• 4 minutes Oil Price Editorial: Beware Of Saudi Oil Tanker Sabotage Stories
  • 6 minutes UAE says four vessels subjected to 'sabotage' near Fujairah port
  • 9 minutes Why is Strait of Hormuz the World's Most Important Oil Artery
  • 13 minutes Mueller Report Brings Into Focus Obama's Attempted Coup Against Trump
  • 2 hours California's Oil Industry Collapses Despite Shale Boom
  • 13 mins Greenpeace Blocks BP HQ
  • 6 hours Knock-Knock: Aircraft Carrier Seen As Barometer Of Tensions With Iran
  • 11 hours The Consequences: Full-Blown Trade War Will Push World Towards Recession
  • 8 hours Australian Voters Reject 'Climate Change' Politicians
  • 2 hours Shale to be profitable in 2019!!!
  • 10 hours IMO2020 To scrub or not to scrub
  • 5 hours Will Canada drop Liberals, vote in Conservatives?
  • 14 hours Global Warming Making The Rich Richer
  • 6 hours UK Needs New Wind Turbines
  • 12 hours Did Saudi Arabia pull a "Jussie Smollett" and fake an attack on themselves to justify indiscriminate bombing on Yemen city population ?
  • 16 hours Shell ‘to have commercial wind farms’ by early 2020s
  • 14 hours California Threatens Ban on ICE Cars
  • 8 hours Wonders of Shale- Gas,bringing investments and jobs to the US
  • 15 mins Get First Access To The Oilprice App!
The Biggest Losers Of The Trade War

The Biggest Losers Of The Trade War

The U.S.-China trade war entered…

Russia Hints At OPEC+ Deal Exit

Russia Hints At OPEC+ Deal Exit

Russian policymakers have shown themselves…

Oil Prices Still Too Low To Allow Angola Balance Its Budget

Oil Barrels

Angola, whose economy is highly dependent on the oil industry and crude export revenues, needs a price of oil at around $85 per barrel in order to balance its budget, and persistently much lower oil prices have piled pressure on the African country’s fiscal situation, Neil Ford writes for Platts.

Oil production and its supporting activities account for around 45 percent of Angola’s GDP and more than 95 percent of exports, according to data by OPEC.

OPEC’s production cuts are not expected to lift oil prices to more than $60 per barrel this year. Thus, in order to inject more revenues into government coffers, Angola faces the choice of either maximizing its oil production—currently constrained by its pledge to adhere to the OPEC deal—or lifting the share of revenues, Ford argues.

Angola’s oil production averaged 1.748 million bpd in 2016, and its production capacity is expected to reach 1.9-2.0 million bpd by the end of this year.

Angola reported $950 million in crude oil export revenues for January this year, the highest in 16 months.

But if the OPEC/non-OPEC agreement to collectively curtail output fails to deliver in terms of oil price gains, Angola may be faced with both low oil prices and declining production, according to Platt’s Ford.

In affirming Angola’s B1 ratings and ‘negative’ outlook, Moody’s said earlier this month that the country’s oil and gas production this year is trending towards 1.825 million bpd, up from 1.748 million bpd in 2016. Several offshore projects launched before the oil shock are coming online over the next 18 months, and would add more than 400,000 bpd to Angola’s oil production.

Related: Oil Prices Edge Lower As Imports Keep Inventories Buoyed

According to the International Monetary Fund (IMF), despite the fact that Angola took some steps to improve non-oil primary fiscal balance, “further policy actions are needed to continue adjusting the economy to the ‘new normal’ in the oil market and to return growth to a level consistent with poverty reduction”. Angola’s real GDP was flat in 2016 and is expected to grow by 1.3 percent this year.

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage

Leave a comment

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News