Angola will have to cut about 18% of oil production on average by April 2022, under the agreement reached by the Organisation of Petroleum Exporting Countries (OPEC), according to calculations made by Lusa.
Last Sunday, OPEC and its main partners meeting within OPEC+, agreed on a cut in production of 9.7 million barrels per day (bpd) in May and June, to cope with the free-fall in oil prices.
Under the agreement, a reduction of 7.7 million barrels was also determined between July and December 2020 and 5.8 million between 1 January 2021 and 30 April 2022.
According to these adjustments, which take as reference the production of October 2018 (except Russia and Saudi Arabia), Angola should produce 1.18 million bpd in May and June, applying 23% of cut compared to 2018 production (1.528 million bpd), according to OPEC tables.
Between July and December 2020, according to the agreement, Angola’s production rises to 1.249 million bpd, as the global cut goes from 9.7 mpb to 7.7 mpb, reflecting a global adjustment from 23% to 18%.
The revised production forecast for Angola for 2020 is 1.360 million bpd.
Between January 2021 and April 2022, production cuts are alleviated to 14% and Angola could start producing 1.319 million bpd.
On average, the reduction in production between May 2020 and April 2022 is 18.3%.
The International Energy Agency (IEA) on Wednesday said in its monthly report on the oil market that world demand for oil is expected to fall by 9.3 million bpd this year due to the global economic paralysis generated by Covid-19.
This historic drop is expected to bring world consumption to the 2012 level of around 90.6 million bpd, predicts the Paris-based agency, blaming the causes on containment measures and the near-stoppage of transport around the world.
To fight the pandemic, governments have sent 4 billion people (more than half the planet’s population) home, shut down non-essential trade and drastically reduced air traffic, paralyzing entire sectors of the world economy.
The “Great Confinement” led the International Monetary Fund (IMF) to make unprecedented predictions in its nearly 75 years: the world economy will fall 3% in 2020, dragged by a 5.9% contraction in the United States, 7.5% in the euro zone and 5.2% in Japan.