Angola the second largest oil producer in Africa after Nigeria is seemingly in a bell weather path. Its oil trade is expected to bounce back. Its export to Asian countries are now getting relatively better margins coupled with better demand profile. The expectation for 2020 is also buoyant, according to oil traders.
Crude from Angola is exported mostly to China, which is expected to pick up in September this year , Refinitiv Eikon data reveals. The International Maritime Organization’s (IMO) changed rules would help Angola to up its crude exports.
From January 2020, IMO will bar ships from using fuels containing more than 0.5% sulphur – compared with 3.5% currently – to reduce air pollution. Angola has in abundance IMO-compliant bunker fuels. Crude mined out from the Cabinda, Kissanje and Hungo grades especially are IMO complinat. While refiners across the world are looking for alternatives to present bunker fuel, Angolan grades will have increased demand. One of the reasons for current lackadaisical demand for crude from Angola was the huge buffer of crude kept by its main buyer China by importing oil from Iran in huge quantities to ward off possible back lash of US sanctions on Iran. Angola’s medium-to-heavy grades, which are processed for gasoil and jet fuel, have higher demand in U.S in 2019.
