Gabon coup fuels crude oil price increase, raises supply concerns — Report
According to a Wall Street Journal report yesterday, there are indications that the recent coup in Gabon is supporting crude oil prices.
According to the WSJ, since Gabon’s coup announcement, global crude oil prices have seen a modest increase due to seeming threats to exports from the country. The Gabon coup is raising supply concerns alongside Hurricane Idalia in the United States, which has raised oil supply concerns as well.
However, Gabon is only a minimal contributor to the Organization of Petroleum Exporting Countries (OPEC), producing only 211,000 barrels per day of oil in July 2023, according to data from OPEC’s monthly oil market report.
Yesterday, OPEC’s chief correspondent, Amena Bake posted on Twitter that so far, it appears that oil production from fields in Gabon is not affected by the military coup.
“The coup and the threat of disruptions to Gabon’s oil exports are supporting oil prices, but only modestly as the nation is a minor OPEC oil producer, DNB Markets analysts Helge Andre Martinsen says. Brent crude oil is up 0.3 per cent at $85.19 a barrel.
“The nation’s output stands at a modest 190,000 barrels a day, but it has been the only African OPEC member to hit its production quotas. So far, there has been no sign of disruption to Gabon’s oil output. Still, the coup serves as a reminder of the geopolitical risk in the oil market, Martinsen says.”
It is important to note that as of 12:50 PM (GMT+1) on Wednesday, August 30, Brent crude price was at $86 per barrel.
Earlier, a cohort of senior military officers declared that they had assumed control following the announcement by the state election body that President Ali Bongo, had secured a third term. Note that Bongo’s Father had ruled as president before him for 42 years.
A part of the speech by the military officers read: “We have decided to defend peace by putting an end to the current regime. To this end, the general elections of 26 August 2023 and the truncated results are cancelled. All the institutions of the republic are dissolved: the government, the Senate, the National Assembly and the Constitutional Court, until further notice.”
What you should know: Gabon’s crude oil production averaged 197,000 barrels per day between April 2016 and July 2023. The data reached an all-time high of 239,000 barrels per day in May 2016 and a record low of 170,000 barrels per day in November 2018, according to data from CEIC.
