EDITORIAL: Brace for oil spike
The resurgent oil price – now at a five-year high – provides yet another opportunity for Africa’s oil-producing nations
Africa has a tendency of missing out on the boom cycles in its own commodities.
Through poorly thought-out and short-term policies, SA missed out on the last gold and coal booms while its officials actively abetted the state capture project of corruption.
Zimbabwe has been eating itself over the past 20 years, missing out on bountiful tobacco crops and elevated gold and platinum prices, while it squandered the revenues from its Marange diamond fields.
The DRC has been even worse. Thanks to a state that can be generously dubbed kleptocratic, the DRC’s citizens were robbed of any benefit from its vast mineral wealth.
But the resurgent oil price — now at a five-year high — provides yet another opportunity for Africa’s oil-producing nations. Nigeria and Angola are best placed to hike production to close the gap left by the US’s sanctions against Iranian oil.
These two countries have had a brutal past four years, in which the oil price stagnated. But they have only themselves (and their corruption and anti-free-market practices) to blame for not banking anything from the boom years to cover the lean years. Nigeria alone has the capacity to produce up to 2.5-million barrels a day.
While most countries on the continent, including SA, can only grimace and bear the hardship of high oil prices, Africa’s producers should not miss the looming boom.