OPEC is unlikely to change its production quota when it meets at the end of next week, said Jose Maria Botelho de Vasconcelos, Angola’s Minister of Petroleum.
The members of the Organization of Petroleum Exporting Countries “feel” oil at $80 to $85 a barrel is a “comfortable price” and will probably keep the group’s output targets unchanged at their meeting on Dec. 11 in Quito, Ecuador, Vasconcelos said in an interview late yesterday in Luanda.
“The current environment is of some stability,” he said. “The sentiment among members is for maintaining the production level.”
Angola, which vies with Nigeria for the rank of Africa’s top oil producer, joins fellow OPEC members Venezuela and Libya in saying that the group is likely to leave quotas unchanged, as they did as OPEC’s last meeting on Oct. 14.
OPEC, which produces about 40 percent of the world’s oil, hasn’t changed quotas since agreeing to its biggest-ever cuts in production in December 2008. Brent crude oil futures for January settlement were trading near $89 a barrel this morning on London’s ICE Futures Europe exchange.
Vasconcelos also said Angola is studying exactly when and where to auction new oil exploration blocks for drilling.
2011 Bidding Round
“It will happen next year,” he said, confirming a Nov. 26 statement by Deputy Oil Minister Anibal Octavio da Silva.
Angola suspended a license bidding round in 2008 because of the country’s legislative elections.
Vasconcelos said he expected oil production to increase to 1.9 million barrels a day next year, which is close to its maximum capacity. The country pumped an average of 1.73 million barrels a day in November, according to a Bloomberg survey of producers and analysts on Nov. 30. Nigeria produced 2.12 million a day.
The government’s 2011 budget is based on production of 1.9 million barrels of oil a day being sold at a “conservative” $68 a barrel, Finance Minister Carlos Alberto Lopes said on Nov. 18. Lopes forecast an economic growth rate of 7.6 percent next year.
Oil accounts for about 60 percent of Angola’s gross domestic product and 80 to 90 percent of its export revenue, Vasconcelos said.
Almost one third of Angola’s production is operated by Chevron Corp., the second-largest U.S. oil company, from off the coast of Cabinda, a northern province separated from the rest of Angola by the 25-mile (40-kilometer) coastline of the Democratic Republic of Congo. Disputes over ownership of the border region’s oil are being handled by a bilateral commission, Vasconcelos said.
“Sometimes the negotiations have certain rhythm and sometimes another rhythm,” he said. “We’re looking for a solution that will satisfy the two countries.”