The Organisation of the Petroleum Exporting Countries (Opec) decided on Thursday to enlarge its membership for the first time in 30 years by admitting African producer Angola, a decision aimed at reinforcing the cartel’s grip on world oil resources.
”The conference unanimously admitted the Republic of Angola as the 12th full member of the organisation, with effect from January 1 2007,” an Opec spokesperson said at the end of a ministerial meeting in Abuja, Nigeria.
Angola was one of three possible new members waiting to join Opec, which already produces about 40% of world supplies. The other two are Sudan and Ecuador.
”Only now we asked to be a member, but our wish to join Opec is since our independence” in 1975, said Angolan Oil Minister Desiderio da Gracia Verissimo e Costa as he made the application to join earlier on Thursday.
”We want to collaborate with Opec members to help to regulate a fair price for everybody, not only producers but also consumers. A price that is low is not good for Angola and for the other members also.”
Opec members aim to regulate their oil exports to influence the market and are thought currently to be aiming for a stable price of about $60 per barrel. The cartel also decided on Thursday to cut its output by 500 000 barrels per day from February 1.
Other candidates
Regarding other candidate countries, Sudan is still trying to pass its membership internally, which requires the approval of President Omar al-Bashir for the North African country to join the cartel.
”If they do [get approval], I expect them to present their application in March,” an Opec spokesperson said.
Ecuador, which joined the cartel in 1973 and left in 1992, must also clear political hurdles, but Venezuelan Energy Minister Rafael said on Thursday that there is domestic support for a membership application.
”We are waiting for Ecuador … There is political will but we have to wait and see. They have a new president,” said Venezuelan Energy Minister Rafael Ramirez, referring to newly elected leftist President Rafael Correa.
”This strengthens Opec and that is the most important thing for us. The more we are in the task of defending our interests and maintaining a balance, the better it is. I hope others will follow,” he added.
Ecuador, which has oil production of 545 000 barrels per day, withdrew from the cartel in 1992 after a dispute about its production quota.
‘Big impact’
Opec president and Nigeria Oil Minister Edmund Daukoru said Angola’s entry ”will make a big impact” because it is a light sweet producer, the highest quality crude, like Nigeria.
He said Angola will not be bound by the production cut of half a million barrels per day announced by Opec on Thursday. ”We have decided not to include Angola because technically they are not a member,” he said. ”They only just submitted their membership application formally.”
Angola will be bound by Opec’s production system, which assigns each member except Iraq a production target, in March.
Opec ministers are to meet in Vienna on March 15 for talks, which will be the first time Angola will take its seat as a fully fledged member.
The Southern African country currently produces 1,4-million barrels a day and aims to raise this figure to two million by the end of next year. The admission of the country is seen as extending the influence of Opec, which already produces about 40% of world oil supplies.
Analysts at Deutsche Bank recently said Angola would boost the world market share of Opec, but they warned that the decision would create uncertainty for foreign oil companies operating in the former Portuguese colony.
Exxon of the United States, Total of France and British group BP are all active in the country, which has seen a surge in interest since the end of its 27-year civil war in 2002.
Angola is the first member to join Opec since Gabon became a member in 1975. Gabon has since left the cartel. Other African oil producers Nigeria, the biggest producer in sub-Saharan Africa, Libya and Algeria are already members of the cartel.
Daukuro, who has pushed for Angola to join, said on Wednesday the decision by Angola ”would bring harmony to the Gulf of Guinea”, where the two countries have oil facilities. ”It was always an odd picture that Nigeria was a member of Opec … and a few kilometres down south is a high light sweet oil producer that’s just blasting,” he said. — Sapa-AFP