Angola: Angolan oil output rises in June
Brent crude oil prices averaged USD 82.92 per barrel in June, down 0.2% from May. On 28 June, the commodity traded at USD 86.43 per barrel, up 5.7% from 31 May. Prices initially dipped due to OPEC+’s unexpected decision on 2 June to begin winding down output curbs from October but rose towards the end of the month due to rising tensions between Israel and Hezbollah.
On the production front, Angolan oil output jumped to an eight-month high of 1.16 million barrels per day (mbpd) in June from 1.13 mbpd in May. June’s reading smashed national oil firm ANPG’s expectations of 1.12 mbpd.
In other news, multinational energy firms Chevron and Sonangol recently signed a contract for ultra-deep-water exploration in Angola’s lower Congo basin; the oil giants will invest around USD 7.2 million, and the project is expected to extract up to around 400,000 barrels per day.
Our Consensus is for oil output to rise this year from 2023’s slump to 1.12 mbpd; our panelists have recently upgraded their 2024 forecasts. In particular, Angola’s exit from OPEC at the tail end of 2023 has been driving increased investor interest in the hydrocarbons sector, translating into a protracted, but steady, recovery. Moreover, production is benefiting from the conclusion of maintenance in the Dalia oilfield in early 2024 and the continued implementation of the government’s 2020-2025 Hydrogen Exploration strategy. That said, maturing oil fields will limit the gains from this fresh flexibility, with production remaining well below the prior 10-year average of 1.44 mbpd.