Angola: Angolan oil output falls to a near two-year low in December
Latest reading: Brent crude oil prices averaged USD 73.23 per barrel in December, down 0.4% from November. On 31 December, the commodity traded at USD 74.74 per barrel, up 2.1% from 29 November. Prices remained broadly steady as trading volumes fell due to the holiday period.
On the production front, Angolan oil output fell to 1.02 million barrels per day (mbpd) in December from 1.13 mbpd in November. December’s reading underperformed the 1.03 mbpd that had been expected by the national oil firm ANPG. It also marked the worst result since March 2023 and moved further below the 2014–2023 average of 1.44 mbpd.
Outlook: Our panel expects oil production to increase in 2025 from 2024, reaching its highest level since 2020. Angola’s exit from OPEC at end-2023 has driven increased investor interest in the hydrocarbons sector; in 2025, rising capacity at the Begonia refinery and new TotalEnergies projects will buttress crude demand in Angola. Moreover, the continued implementation of the government’s 2020–2025 Hydrogen Exploration strategy should add further support to the sector. That said, production will remain well below its past-decade average through our forecast horizon in 2029, as maturing oil fields will continue to weigh on the sector; in 2025, this will drive a stagnation in the oil sector as a whole. Weaker-than-expected demand from China is a downside risk.
Panelist insight: Analysts at the EIU have a more optimistic outlook for production:
“We expect the tax cuts and other incentives to attract higher levels of foreign and domestic investment into Angola’s oil sector, helping to tap into the country’s vast proven oil reserves (of an estimated 9bn barrels), boosting oil production and therefore economic growth in the medium term. We expect oil output to rise […] to an average of 1.6m barrels/day (b/d) in 2029.”