Angola: Cabinda prices fall again in October
On average, Angolan Cabinda oil sold at USD 40.3 per barrel (pb), down from September’s USD 41.0 pb. The print marked the second consecutive drop in the average price following August’s six-month high, likely due to the renewal of some restrictive measures across the globe as new Covid-19 cases surged. Moreover, the average price in October was down 1.8% month-on-month and remained notable depressed by historical standards as they dropped a staggering 34.8% year-on-year.
On top of likely softer demand, the downtick in prices was also influenced by a rise in global supply levels amid increased production in Iraq, Libya and Nigeria driving up OPEC+ output in the month. On the other hand, Angolan output declined to 1.12 million barrels per day (mbpd) in October from September’s 1.18 mbpd, marking the lowest level of output since February 2005.
Next year, prices should pick up on a recovering global economy driving up demand. That said, questions of the strength of the post-pandemic recovery remain as well as geopolitical tensions. Turning to output, production of Angolan Cabinda oil is expected to remain around this year’s level; strengthening demand amid a global economic recovery is expected to be offset by the effect of previous production cuts.