Angola Commodities March 2019

Angola: Cabinda crude oil prices rise to five-month high in March

The average price of Angola’s Cabinda crude oil rose from USD 65.2 per barrel (pb) in February to a five-month high of USD 66.8 pb in March. March’s price was 2.4% above the average price observed in the previous month and 0.2% higher in year-on-year terms.

Global oil prices climbed further in March largely on the back of tightening global supply. The voluntary production cuts agreed upon by OPEC+ members and involuntary output reductions in Venezuela and Iran, which reflect the effectiveness of U.S.-imposed sanctions, helped boost prices over the past month. Political instability and escalating fighting in Libya also contributed to reduced supply and thus to the firming up of prices.

Oil production in Angola, however, inched up from an over 12-year low of 1.46 million barrels per day (mbpd) in February to 1.47 mbpd in March. Meanwhile, crude oil production among OPEC countries declined from 30.56 mbpd in February to 30.02 mbpd in March, according to the latest OPEC report published on 10 April.

Looking forward, the outlook for oil prices remains somewhat uncertain. OPEC+ members are set to meet in June to discuss whether to extend production cuts for the rest of the year, which would further prop up prices. At the same time, heightened concerns over the pace of global growth could dent demand, thus weighing on the price outlook.

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