Prospect of lower oil prices puts pressure on Angola, finance minister says

The prospect of lower oil prices puts "lots of pressure" on Angola, the country's finance minister told Reuters on Friday, adding that she expected to see prices average around US$70 to US$72 per barrel compared with US$75 in 2024.

The government of Africa's second-largest crude oil exporter will also continue to phase out fuel subsidies, finance minister Vera Daves de Sousa said in an interview on the sidelines of the International Monetary Fund (IMF) and World Bank annual meetings in Washington.

"How many steps we didn't decide yet, but our idea is to do it in steps," she said, confirming that subsidies were amounting to around 4% of gross domestic product (GDP) this year.

Angola left the Organisation of the Petroleum Exporting Countries (OPEC) at the beginning of this year.

Brent crude futures settled up 2.25% to US$76.05 a barrel on Friday. Analysts have warned that oil prices would come under pressure next year due to ample supply and lacklustre demand.

Daves de Sousa said the government will present its budget to parliament next week, with figures on external financing needs being finalised over the next few days.

She said Angola was internally examining the possibility of requesting a financing programme from the IMF.

"We asked for a note with options of programmes in case we request, and considering our current situation, what they understand as a good programme for us," she said.

She said the government was also considering other options, such as a mix of funding from other multilateral sources such as the World Bank and the African Development Bank, as well as domestic capital markets and banks.

The most recent IMF programme with Angola was for US$3.7 billion, approved in December 2018 after global crude prices tanked, decimating the country's revenues.