Angola quits OPEC amid production quota dispute
Angola has officially announced its departure from the Organization of the Petroleum Exporting Countries (OPEC).
The announcent was made on Thursday, following a heated disagreement over production quotas.
The decision, not taken lightly, was confirmed by Mineral Resources and Petroleum minister Diamantino Azevedo, who asserted that OPEC membership no longer served Angola’s best interests.
Minister Azevedo, speaking on behalf of the African nation, stated, “We feel that at this moment Angola gains nothing by remaining in the organization and, in defense of its interests, it decided to leave.”
The decision was made during a cabinet meeting chaired by President Joao Lourenco in the capital, Luanda, and subsequently formalized by a decree signed by President Lourenco.
The primary point of contention stemmed from OPEC’s recent decision to further reduce oil production in the upcoming year, a move intended to stabilize volatile prices.
Azevedo expressed Angola’s dissatisfaction, highlighting that continued OPEC membership would compel the country to cut production, contradicting its policy of avoiding decline and respecting contracts.
Angola, a key player in Sub-Saharan Africa’s oil exports alongside Nigeria, had already voiced displeasure over its production quotas during the November OPEC ministerial meeting. The gathering faced delays due to disagreements among member nations.
Azevedo explained, “When we see that we are in organizations and our contributions, our ideas, do not produce any effect, the best thing is to withdraw.”
This decision reflects Angola’s commitment to focusing on its national goals amid perceived ineffectiveness within the OPEC framework.
The move comes at a time when global crude prices linger near a six-month low, despite OPEC’s previous announcement to cut output. Recent geopolitical tensions, including drone and missile attacks by Huthi rebels leading to the avoidance of the Red Sea and Suez Canal, have caused a slight uptick in prices. However, they remain below the $80 per barrel mark.
While OPEC+ has implemented substantial supply cuts exceeding five million barrels per day since the end of 2022 to support prices, internal discord poses an additional challenge. Established in 1960, the 13-member OPEC cartel partnered with 10 other producers in 2016 to form OPEC+, aiming to enhance collective influence.
This development underscores the broader challenges faced by OPEC+, including rising US crude production and the impending transition away from fossil fuels.
Angola’s departure marks a notable shift in the dynamics of global oil alliances, adding complexity to an already intricate landscape.
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