Crude Oil: Production Slumps

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Crude Oil: Production Slumps

02 août 2021 13:24

Crude oil accounts for most of the production and export of the extractive sector in Cameroon but the sector suffers from frequent price fluctuations.

Cameroon is one of the leading producers of crude oil in the world. Ranked 55th in the world with known oil reserves of some 200,000,000 barrels as at 2016, the country’s oil production stands at 92.469 barrels per day making it the 52nd highest producer in the world according to Worldometer statistics. In February 2021, production of crude oil for Cameroon was 64.51 thousand barrels per day. Production fell gradually from 67.68 thousand barrels per day in March 2020 to 64.51 thousand barrels per day in February 2021.

According to the National Hydrocarbons Corporation (SNH), production during the first quarter of 2019 (January to 30 April 2019) oil production stood at 8.10 million barrels recording a regression of -1.53 per cent compared to same period during the previous year. This, SNH attributed to the natural depletion of oil fields. Between January to April 30, 2021, SNH reported that crude oil production was at 8.419 million barrels recording a drop of -6.82 per cent compared to same period in 2020.

The share of oil revenues in the Cameroonian State budget is forecasted to drop from FCFA 450 billion this year to FCFA 409 billion in 2020 before further falling to FCFA 390 billion in 2021, making a total decline by FCFA 60 billion over the 3-year period. This was revealed in the provisional operation table made available by the finance department. With a 33.2 fall in the world crude oil prices Cameroon’s 2021 State budget projected oil revenue to FCFA 293 billion. While the real reasons for this diminution are not clearly specified, it can be attributable to the fluctuation in international crude oil prices per barrel, in relation to the value of the dollar, and even the evolution of local production, which has been declining in recent years. The average price of Cameroon crude oil according to SNH is USD 39.38 per barrel.