Browsing: OPEC

Saudi Arabia has embarked on a goal to increase oil output.  With higher oil output, the global target to meet…

Half of OPEC Member Countries are African and this includes the continent’s most populous country, Nigeria, and the largest by…

If oil disappeared tomorrow, thousands of petroleum-based products would vanish with it. If oil disappeared tomorrow, it would be catastrophic…

Congo is working to increase its crude oil and gas production ahead of OPEC negotiations in November. Afreximbank is offering…

Nairobi will continue purchasing fuel on credit from three state-owned Gulf oil marketers until December 2024 in a plan the government is banking on to ease piling pressure on Kenya’s forex reserves.
The move comes in the wake of high expenditure on oil imports even as Kenya remains a net importer grappling with a widening trade deficit that hit $10.8 billion last year. Last year, Kenya’s expenditure on imports rose by 17.5 per cent to $16.9 billion (KSh2.5 trillion), despite growing export volumes.

Russia’s invasion of Ukraine in February 2022 threw oil and gas markets into disarray. Consequently, the world experienced the first real global energy crisis during the uneven economic recovery from the COVID-19 epidemic. Russia’s inclusion in the OPEC+ group has hampered international attempts to manage the situation. This has made it harder to handle the significant inflationary effects of rising global fuel prices, particularly in developing nations.

Global fuel prices have risen exponentially in the last few months. The rise is hugely significant, as it has seriously aggravated the global cost-of-living crisis. African economies have particularly been on the receiving end. The continent has suffered from disrupted supply chains and a slowdown in the global economic outlook. Thus, rising energy costs complicate matters even further.

For many Kenyans, life was unbearable during former President Uhuru Kenyatta’s reign. But just one year after President William Ruto came to power, life is getting more onerous. High taxation, the depreciation of the shilling against the dollar, and record-high fuel prices have highlighted the last few months. This has painted a grim picture of Kenya’s future and shattered citizens’ hopes for economic reinvigoration.
On September 14, 2023, the Energy and Petroleum Regulatory Authority (EPRA) announced record-high fuel prices for the September-October regulation cycle. A litre of super will now retail at Kes 211.64, diesel at Kes 200.90, and Kerosene at Kes 202.61. This represents an increase of Kes 16.96, 21.32, and 33.13, respectively, in the new prices announced last midnight.

African countries will be largely impacted by the decision by the global cartel of oil producing countries to cut oil production given that only 14 out of 54 countries in Sub-Sahara Africa produce oil, which accounts for the lion’s share of their annual export earnings.

Many African countries have to import refined oil and rely on oil products in power generation. A hike in oil prices will boost economies of oil producing countries, by gaining foreign exchange earnings to carry out development projects such as Nigeria, Angola, Gabon, Libya, Cameroon, and Congo among others.

Consequently, this will create more job opportunities and greatly aid in poverty alleviation. In addition, the revenues could be redirected to other sectors that make significant contributions to the respective economies. By example, in countries like Cameroon, Gabon and Congo, internet infrastructure and technology could largely benefit from re-investing.

African governments must consider strategies to optimise the effective use of imported oil. The optimisation will reduce net oil import proportions to minimise expenses. More generally, African nations must explore these strategies to minimise their reliance on oil as their only energy source.

Reducing oil consumption by shifting to renewable resources represents a long-term or short-term solution. In contrast, if Africa is to benefit or gain from the imminent possibility of an increase in oil prices, these few oil-producing nations must expand their crude oil production and refinery capacity.

Nigerian presidential contenders must confront persistent insecurity, chronic unemployment, and a deteriorating economic outlook. Bola Tinubu outlined his vision before the Nigeria elections in 2023 in an 80-page paper released by President Muhammadu Buhari at a lavish ceremony on October 21, 2022.