Angola has declared its decision to withdraw from the Organization of the Petroleum Exporting Countries (OPEC) due to a disagreement regarding production quotas. The move reduces OPEC’s membership to 12 nations.
In a statement on Thursday, Diamantino Azevedo, the Minister for Mineral Resources, Petroleum, and Gas, announced that Angola, with a daily oil production of approximately 1.1 million barrels, finds no benefit in remaining within the organization, citing a misalignment with the country’s interests.
“We feel that … Angola currently gains nothing by remaining in the organisation and, in defence of its interests, decided to leave,” Azevedo stated.
Angola, an OPEC member since 2007, has grappled with meeting production quotas in recent years. Joining the ranks of countries like Qatar and Ecuador, which departed OPEC in the past decade, Angola’s departure adds to the uncertainties surrounding the organization’s future.
Questions about potential production cuts, particularly advocated by leading oil producers like Saudi Arabia, have sparked recent debates within OPEC. Following Angola’s exit, OPEC nations are expected to collectively produce around 27 million barrels of oil per day, constituting about 27 percent of the global supply.
While Angola’s contribution to OPEC was relatively modest, the departure raises broader concerns about the organization’s cohesion. The announcement led to a more than 1.5 percent drop in crude prices.
Giovanni Staunovo, a commodity analyst with UBS, commented on the market impact, stating, “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.”
Despite the minimal direct impact on the oil market, the decision has fueled concerns about the unity of OPEC+, although there is currently no indication that other heavyweight members within the alliance plan to follow Angola’s path.
Oil and gas constitute approximately 90 percent of Angola’s exports, serving as a critical economic lifeline for the nation. Last month, Azevedo’s office protested against an OPEC decision to reduce its production quota for 2024, expressing concerns about potential damage to Angola’s capacity to increase output.
Angola’s peak production capacity of 2 million barrels per day in 2008 has since declined due to aging infrastructure, reflecting the challenges faced by the nation within the oil market.