Angola: Cabinda prices rise in May
Cabinda oil sold for USD 68.6 per barrel (pb) on average in May, up from USD 64.2 pb in April. The print marked a 6.8% month-on-month increase (April: -2.3% mom). Meanwhile, the average price rose 146.1% year-on-year in May on the back of a favorable base effect, as oil prices nosedived last year amid the first wave of the Covid-19 pandemic. However, this was down from the 356.0% year-on-year increase logged in April.
Improving demand dynamics have supported prices in recent weeks due to the global rollout of Covid-19 vaccines and the gradual easing of restrictive measures. Consequently, road usage has picked up pace. Turning to output, Angolan output eased to 1.12 million barrels per day (mbpd) in May from 1.18 mbpd in April. OPEC+ production, however, rose amid significantly greater output in Saudi Arabia.
Oil prices should average higher this year relative to 2020 as global activity gains traction and stimulates demand for the black gold. That said, questions remain over the strength of the global recovery, as well as vaccine availability and efficacy. In terms of output, Angolan production should ease slightly this year compared to last year due to the effect of previous production cuts.