Editorial by Jean-Pierre Favennec
 Apr 8, 2024

An energy sector under pressure

Oil: on the way to $100?

After peaking two years ago at the start of the war in Ukraine, the price of oil fell sharply, to $70 a barrel or less. By 2023, successive efforts by OPEC and OPEC plus to raise prices had had little effect. The production cuts announced in particular by Saudi Arabia, the undisputed leader of OPEC, were not enough.

The situation changed at the start of 2024. Economic growth is strong in the United States and China's economic situation, although still fragile, has improved compared with 2023. Demand for oil, despite the announcements at COP 28 of an energy transition "away from fossil fuels", remains strong and rising. On the supply side, OPEC's decision to extend its production cuts leaves open the threat that oil production will be insufficient to meet demand at the end of the year.

All this against a worrying geopolitical backdrop: war in Ukraine, which shows no sign of abating; crisis in the Middle East.

Oil and gas projects in Africa

Africa has around 7% of the world's oil reserves and the same percentage of gas reserves. However, oil production has fallen sharply in 10 years (from 440 to 330 Mt/year), particularly in Nigeria and Angola, where combined production has fallen by around 40%, or 80 Mt/year. This fall in production is due to insufficient exploration efforts. In these two countries, international companies are playing an important role, and the context (energy transition aimed at reducing hydrocarbon production, pressure from NGOs on oil companies to reduce their activities, particularly in Africa, refusal by a growing number of banks to finance these activities) is dissuading them from investing the necessary sums, with a few exceptions.

But let's remember once again that while it is vital at global level to reduce greenhouse gas emissions, Africa, with 17% of the world's population, consumes barely 4% of energy and emits just over 3% of greenhouse gases. It is therefore vital that African countries that have hydrocarbon reserves can exploit them to meet their energy needs and benefit from the profits of exports for their development.

More renewables

Africa has considerable renewable energy potential, particularly in solar energy (Sahelian zone, southern Africa) and geothermal energy (Kenya). However, at the seminar entitled "COP 28 - Transition away from fossil fuels - What impact for African economies? organised in Paris by the African Business Club on 5 April, emphasis was placed on the urgent need to find sufficient funding for the development of renewables. Too many projects remain unfinished, due in particular to the lack of loans on reasonable terms. Interest rates are too high because of the risks faced by projects. Operations therefore need to be "de-risked".

Our next conference

The theme of our think tank's next conference will be "Refining and the supply of petroleum products in Africa".

The programme is available on the website

The conference will be held on 16 April at 4.30pm (Paris) by ZOOM

Register with Latifa Hanifi

Jean-Pierre Favennec
Association pour
le Développement
de l'Énergie en Afrique


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 Oct 5, 2023

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 Dec 13, 2022

In its latest report, the International Energy Agency reveals that the cost of technologies related to renewable energies has dropped significantly. A decrease that favors the development of these.
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Apr 16, 2024

Refining and supply of petroleum products in Africa

Tuesday, 16 April 2024
16:30 to 19:00 (14:30 to 17:00 Dakar)

More informations
Jan 23, 2024

SIEPA 2024

23 and 34 January 2024

Oct 16, 2023

Geopolitical aspects of oil and gas in Africa

Monday, 16 October 2023
14h00 – 16h15 Dakar
16h00 – 18h15 Paris

To access the conference please register withLatifa Hanifi

More informations