2023-12-21 20:26:03
Angola decided to withdraw from the Organization of the Petroleum Exporting Countries (OPEC) amid a disagreement over oil production quotas, saying it was time to “focus more” on its own goals. The decision was taken after a meeting of the Council of Ministers held this Thursday (21) at the presidential palace in Luanda, according to a statement. On the same day, it was transformed into a decree with the force of law, signed by President João Lourenço.
Published on: 21/12/2023 – 19:26
4 min
“Until now, we have had no influence on the quotas, but if we remained in OPEC we would suffer the consequences of the decision to respect production quotas”, explained Diamantino de Azevedo, Minister of Natural Resources, Oil and Gas, on state television TPA, on Thursday -fair.
Angola would then be “forced to reduce its production, which goes against our policy of avoiding any reduction and respecting contracts”, according to Azevedo.
At the end of November, Angola and Nigeria, the two oil heavyweights on the African continent, expressed their dissatisfaction with their quotas at the alliance’s last ministerial meeting, which was postponed for several days due to disagreements.
OPEC has set a quota of 1.11 million barrels per day for Angola, which the country is vehemently contesting, pursuing its own target of 1.18 million barrels per day.
“At the moment, Angola has nothing to gain by remaining in the organization and, to defend its interests, it has decided to leave it,” explained the minister to the press gathered at the presidency, according to the official statement from the Angolan government.
“When we see that we are in organizations and that our contributions, our ideas, have no effect, it is better to leave”, emphasized the minister, after the country entered in 2007. Contacted by the agency AFPOPEC, which has its headquarters in Vienna, did not comment.
Own goals
Although “the impact on the group’s international reputation will be smaller” than if “a larger producer” such as Iraq, Saudi Arabia or the United Arab Emirates were to leave, “the timing of the announcement could not be worse, at a time when the cartel is working hard to convince its members to voluntarily cut production in order to support prices,” said Ricardo Evangelista, analyst at ActivTrades.
Despite the new cuts announced in November, crude oil prices remain anchored at their lowest level since June (between US$70 and US$80 a barrel), remaining above the average of the last five years. The announcement of the country’s departure led to a deepening of oil losses, with prices already pressured by expectations of weak economic demand.
At around 3:30 pm GMT (12:30 pm in Brasília), the price of a barrel of Brent North Sea oil for delivery in February fell 0.94%, to US$78.95. Its equivalent in the US, a barrel of West Texas Intermediate (WTI) for delivery in the same month, lost 0.96%, to US$ 73.51. OPEC and its ten OPEC+ allies appear to have lost some of their influence in recent times, amid dissension, competition from the United States and a feverish response to the climate emergency.
“We have always fulfilled our duty, but Angola decided to leave. The time has come for our country to focus more on its objectives”, explained the minister on television.
Angola has been very active, “but our role within the organization no longer seems relevant to us at the moment,” he declared. “The current results do not serve our interests.”
Opec+
Founded in 1960, OPEC, which has 13 members led by Riyadh, formed an alliance in 2016 with ten other countries, including Moscow, in the form of an agreement known as OPEC+, with the aim of limiting supply and supporting prices in the face of challenges posed by American competition.
The departure from Angola could, therefore, be part of President João Lourenço’s strategy of “fostering close ties with the United States”, points out Marisa Lourenço, a political and economic risk analyst specializing in the region.
In mid-December, at COP28 in Dubai, the world’s countries approved a historic commitment, paving the way for the gradual abandonment of fossil fuels that cause global warming, calling for “a transition away from fossil fuels in energy systems, in a fair, orderly and equitable manner, accelerating action in this crucial decade.”
(With AFP)
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