Brent crude, the benchmark for Angolan oil exports, was up 0.52%, trading at USD 65.20 per barrel. Despite the uptick, oil prices remain below the USD 70 per barrel mark set by the Angolan Government in its 2025 General State Budget (OGE). According to the OGE’s justification report, for every USD 5 drop below the reference price, the budget deficit doubles from the already projected 1.65% of GDP (1.5 billion Kz) to 3.3% (3.0 billion Kz), if prices stay at USD 65.
Oil prices are reversing Thursday’s earlier losses, which came after rising gasoline and diesel inventories in the U.S. pressured the commodity. This comes as traders weigh Saudi Arabia’s July price cuts for Asian oil buyers, alongside ongoing global economic uncertainty.
By 8:00 a.m. Luanda time, Brent crude had risen 0.52% to USD 65.20 per barrel, while West Texas Intermediate (WTI), the U.S. benchmark, gained 0.41% to USD 63.11.
Thus, oil remains below the USD 70 per barrel threshold set in Angola’s 2025 budget, which affects fiscal revenue, especially since oil production is also in decline. For every USD 5 drop in the barrel price, the deficit doubles, per the OGE’s official estimates.
On Wednesday, oil prices fell by about 1%, after official data showed that U.S. crude stockpiles rose more than expected, reflecting weaker demand in the world’s largest economy.
As for Saudi Arabia’s decision to lower prices for Asian buyers, ANZ analysts told Reuters that “although the Saudi cut was smaller than expected, it suggests weak demand, despite entering the peak demand season.”
The Saudi price cut follows OPEC+’s decision to increase crude output by 411,000 barrels per day in July.
Source: Expansão
