The Organization of the Petroleum Exporting Countries (OPEC) released its monthly oil market report. The report highlights how the global oil demand forecast for 2024 has remained unchanged. The group had earlier projected that demand would rise by 2.25mn b/d to 104.46mn b/d this year and by a further 1.85mn b/d to 106.31mn b/d next year.
Oil Prices Rise Despite Downward Trend in Refining
According to the report, the OPEC Reference Basket (ORB) value rose by nearly $5 per barrel (5.8%) to an average of $89.12/b in April. Similarly, the ICE Brent and NYMEX WTI front-month contracts saw increases of around 5%. Despite a decrease in refinery margins due to increased processing and product output, oil futures prices experienced a significant jump. Crude oil futures prices jumped by 5% compared to the previous month.
This surge in oil futures prices is attributed to a combination of factors. Increased risk premiums due to geopolitical concerns and a positive outlook from money managers have contributed to the upward trend. However, the diesel market has shown signs of weakening. Traders remain cautiously optimistic about oil market fundamentals heading into the driving season.
However, the recent report reveals a mixed picture from African member states. Most African OPEC members saw a decline in production compared to the previous period. Here are the top oil-producing countries in Africa for April 2024.
| Rank | Country | Oil produced tb/d |
|---|---|---|
| 1. | Nigeria | 1,354 tb/d |
| 2. | Libya | 1,179 tb/d |
| 3. | Algeria | 909 tb/d |
| 4. | Congo | 271 tb/d |
| 5. | Gabon | 219 tb/d |
1. Nigeria
Nigeria’s crude oil production rose by 51 thousand barrels in April to 1.28 million barrels. OPEC is still forecasting steady global oil demand for the oil giant. Including condensate oil, Nigeria’s oil production rose to 1.447 million barrels per day (mbpd) in April, compared to 1.438 mbpd the prior month. Nigeria’s output dropped by 6.8% to 1.23 million barrels per day in March 2024 from 1.32 bpd in February 2024. Still, Nigeria has set a goal to hit two million barrels of oil production by the end of 2024.
2. Libya
Libya has always been a very significant player in global oil markets. However, primary politics and poor governance have hindered Libya from fully capitalizing on its oil wealth. Earlier this year, protesters from its southern region disrupted Libya’s major oil fields, El Sharara, the country’s largest, and El-Feel. The turmoil was over high fuel prices and general economic distress. However, in March, Libya’s oil output rose by 5.4% to 1.236 million bpd in March 2024, from 1.173 million bpd in February 2024, making it Africa’s highest crude oil producer. The International Energy Agency (IEA) forecasts a modest increase in Libya’s oil production capacity, reaching 1.2 million barrels per day by 2028.
3. Algeria
Earlier this year, Algeria announced a voluntary reduction of 51,000 bpd as part of the OPEC+ alliance’s production cut agreement to cut oil production by 2.2 million barrels per day in the first quarter of 2024. Algeria has expressed confidence that it can reach a production capacity of 1.155 million barrels per day in 2025. Last month, the country announced a $50 million investment in oil and gas projects over the next four years to boost production.
4. Congo
International operators are actively increasing exploration and production efforts in Congo. Oil and gas asset development company Trident OGX Congo is leading the charge. Their seven-year development program in the Mengo-Kundji-Bindi oilfields, backed by a $300 million investment from the African Export-Import Bank, is projected to increase Congo’s crude oil production by 30%. Crude Oil Production in the Republic of the Congo increased to 259 BBL/D/1K in April from 254 BBL/D/1K in March 2024.
5. Gabon
Gabon is currently the eighth largest oil producer in sub-Saharan Africa, with an average production of 198,000 barrels per day. Last month, Gabon increased output to 230,000 barrels a day, around 60,000 above its quota. This is coming after BW Energy successfully commenced oil production from the DHBSM-1H well in Gabon in March, five months after its discovery. The company reported that production is performing as expected, currently stable at around 5,000-6,000 barrels of oil per day.