The consequences for Russia of Angola’s withdrawal from OPEC will be minimal. None of the large and important oil producing countries will leave the alliance in the coming months, which means oil prices will remain unchanged. This forecast was given to socialbites.ca by Sovcombank’s chief analyst Mikhail Vasiliev.
“After Angola leaves OPEC, there will be 12 countries left. Let’s remember that Qatar, Indonesia and Ecuador have left the cartel in recent years. Overall, Angola’s decision did not have a significant impact on the oil market. The country produces 1.1 million barrels per day and does not have enough capacity to significantly increase production and disrupt the supply-demand balance on the world market,” Vasiliev emphasized.
In this context, the analyst admitted that the price of a barrel of oil for the reference North Sea Brent brand will not change in the coming months, and the quotas will remain in the range of 73-83 dollars per barrel. In his 2024 forecasts, Vasiliev predicts the average Brent price at 80 dollars per barrel. The analyst therefore concluded that the impact of Angola’s exit from OPEC on Russia would be minimal.
However, the African country’s decision confirms the existence of internal disagreements within the OPEC+ alliance. At the previous OPEC+ meeting held at the end of November, African countries, including Angola, were among those dissatisfied with the reduction of oil production quotas on November 30. Angola’s production was below current production levels at 1.11 million barrels per day. When the alliance reached an agreement in June, the quota was 1.28 million, but the country could not produce that much oil. Reuters wrote that disputes over quotas for African countries caused the meeting of OPEC + representatives to be postponed for four days.
Previously analyst Koroev explained Market reaction to Angola’s withdrawal from OPEC is calm.