Angola to Exit OPEC Amid Dispute on Oil Production Quotas
TEHRAN (Tasnim) - Angola has declared its departure from the Organization of the Petroleum Exporting Countries (OPEC) due to a rift concerning production quotas, marking a move that will reduce the group's membership to 12 nations.
In a televised announcement on Thursday, Diamantino Azevedo, Angola's Minister for Mineral Resources, Petroleum, and Gas, expressed that the country, which produces approximately 1.1 million barrels of oil daily, finds it non-beneficial to remain within OPEC due to a lack of favorable outcomes aligned with its interests.
Azevedo emphasized Angola's decision as a defensive measure to secure its interests, as per a statement released by the president's office.
Having joined OPEC in 2007, Angola has grappled with meeting production quotas in recent years, aligning its exit with countries like Qatar and Ecuador that departed the organization during the last decade. Tensions regarding potential production reductions advocated by leading oil producers, notably Saudi Arabia, have sparked considerable discussions within the group.
With Angola's departure, OPEC's collective oil production is projected to drop to approximately 27 million barrels per day, representing around 27% of the global oil supply. Yet, the exit of Angola, albeit a relatively minor contributor within OPEC, poses broader inquiries about the organization's future dynamics.
Crude prices dropped by more than 1.5 percent after the announcement.
“From an oil market supply perspective, the impact is minimal as oil production in Angola was on a downward trend and higher production would first require higher investments,” said Giovanni Staunovo, a commodity analyst with UBS.
“However, prices still fell on concern of the unity of OPEC+ as a group, but there is no indication that more heavyweights within the alliance intend to follow the path of Angola.”
Oil and gas make up about 90 percent of Angola’s exports and are a crucial economic lifeline for the country.
Last month, Azevedo’s office protested against an OPEC decision to reduce its production quota for 2024, concerned that it would damage Angola’s ability to increase its output capacity.
OPEC and its allies in OPEC+ have agreed to cut production to prop up oil prices.
Angola’s production capacity peaked in 2008 at 2 million barrels per day but has dropped since due to ageing infrastructure.
