Angola: Cabinda prices fall in May
The average price for Cabinda oil fell to USD 77.1 per barrel (pb) in May from April’s 85.7 pb. This marked a 10.1% decrease month on month. Meanwhile, prices were down 33.7% year on year, reflecting last year’s large increase in prices at the outset of the war in Ukraine.
Oil prices declined in May amid disappointing Chinese data and uncertainty ahead of the Fed’s June meeting. On the supply side, downward pressure on prices was exacerbated by resilient Russian oil exports.
Turning to production, Cabinda oil output increased to 1.15 million barrels per day (mbpd) in May from April’s 1.09 mbpd. Average production among other OPEC+ members trended down; output declined in Saudi Arabia, Kuwait and the UAE, while it remained unchanged in Iraq and increased in Iran.
Global oil prices are seen rising from current levels by year-end but are forecast to remain below the highs recorded at the outset of the war in Ukraine. The reopening of the Chinese economy will buttress demand and is likely to offset the negative impact of a global economic slowdown. Supply-wise, new OPEC+ cuts effective from May onwards, coupled with cuts in Saudi Arabia starting in July, will exert upward pressures on prices for the black gold. Key factors to watch include the health of the global economy, the evolution of OPEC+ cuts, the effect of sanctions on Russian exports, and the production levels of other crude producers. Turning to output, our panelists see Angolan oil production slightly below last year’s levels.