KEY POINTS
- Nigeria remains Africa’s largest oil producer at 1.48 million b/d, driving GDP despite theft and pipeline challenges.
- Angola’s steady output supports economic diversification, exiting OPEC for independent production growth.
- Algeria balances energy export reliance with renewable investments, sustaining 908,000 b/d output amid OPEC quota extensions.
The oil industry remains one of the most significant success factors in Africa’s economic growth. In light of large untapped oil resources and a growing energy deficit (World Bank, 2023), the production of oil has become a driving force of GDP for many African countries.
Worldwide demand for petroleum is expected to increase to 115 mb/d by 2025 — an increase of 38 mb/d per year on average or 1.7 percent per year from 2002 to 2025.
However, Organisation for Economic Co-operation and Development (OECD) countries will retain the largest proportion of total oil demand in the foreseeable future.
International nations in the continent depend on oil exportation to finance infrastructural build-up, social services provision, and more diversification of economic structures (OPEC World Oil Outlook, 2024).
With the changing dynamics in the global energy picture, to which OPEC expects demand for oil to increase by 1.93 mb/d in 2024 and 1.64 mb/d in 2025, Africa’s main oil exporting nations are poised for both the challenges and the opportunities which underline the importance of their role within Africa’s energy evolution.
Africa’s oil producers in Africa are crucial to the future of the continent’s economy. If the nations identify and manage these challenges while working on opportunities, they can post sustainable development and support energy markets (International Monetary Fund, Regional Economic Outlook, 2024).
Given the strong investment, improved environmental standards and partnership, Africa’s oil industry will be a catalyst for change for the continent.
Let’s delve into the ten leading oil-producing countries in Africa for 2024 and their effect on economic development.
1. Nigeria: Africa’s largest oil producer (1.48 million b/d)
Projections: Nigeria is targeting an oil production of 2.06 million barrels per day.
Economic priorities: While oil and gas remain central, contributing significantly to export earnings, Nigeria is also focusing on sectors like agriculture, telecommunications, and services to diversify its economy.
Oil refineries: Nigeria has four old refineries, including the newly operational 20.5 billion Dangote Refinery boasting the world’s largest single-train capacity (650,000 barrels per day).The Dangote Oil Refinery aims to wean Nigeria off its reliance on imported fuels (Billionaires Africa). Abdulsamad Rabiu entered the refinery race with the BUA Refinery. Situated in Akwa Ibom, Nigeria, the BUA Refinery aims to refine 200,000 barrels per day, contributing significantly to Nigeria’s refining capacity.
Oil-producing states: Key states include Rivers, Delta, Bayelsa, and Akwa Ibom.
Economically Developed States and Capital: Lagos State is the economic hub, while Abuja serves as the capital city.
GDP: Nigeria with over 250 million population is among one of the countries with the highest GDP in Africa.
The Gross Domestic Product (GDP) of Nigeria was worth $362.81 billion in 2023, according to official data from the World Bank. reflecting its large economy driven by oil revenues and a growing services sector.
Nigeria cemented its status as Africa’s top oil producer in November 2024, ramping up production to 1.48 million barrels per day(bpd)—a 15.3 percent increase from October’s 1.3 million bpd. The milestone widened its lead over Algeria, which produced 908,000 bpd, and Congo, which posted an output of 268,000 bpd.
Resilient recovery amid structural challenges: Compared to November 2023, when output stood at 1.5 million bpd, production grew by 13.3% year-on-year. Despite this upward trajectory, Nigeria remains shy of its OPEC-imposed target of 1.5 million bpd. Long-standing issues, including crude theft and pipeline sabotage—especially in the Niger Delta—continue to suppress the sector’s potential.
Efforts to combat these challenges have seen mixed results, with losses from theft alone amounting to billions of dollars annually. The government’s focus on increasing security and adopting advanced monitoring technologies has yet to yield the desired impact.
Economic impact of oil production: Oil production remains a cornerstone of Nigeria’s $500 billion economy, influencing government revenue, foreign exchange earnings, and fiscal stability. Despite a strong 3.46 percent GDP growth in Q3 2024, driven largely by the services sector, oil volatility continues to shape macroeconomic outcomes.
Production shortfalls exacerbate fiscal pressures, leading to budget deficits and foreign exchange shortages. Conversely, sustained output growth could stabilize the naira and enhance public finances.
Global implications: On a broader scale, Nigeria’s output fluctuations contribute to global oil market dynamics, adding a layer of volatility. With OPEC’s production cuts tightening supply, Nigeria’s challenges weigh heavily on price stability.
Analysts suggest that sustained production above 1.5 million bpd could not only bolster Nigeria’s economic resilience but also enhance its influence in OPEC’s policy decisions.
As Nigeria seeks to balance recovery efforts with structural reforms, its performance in 2024 underscores both its potential and the persistent challenges undermining its ambitions in the global energy landscape.
2. Angola: Second-largest oil producer (1.1 million b/d)
Projections: With an estimated 9 billion barrels of proven crude oil reserves, this makes Angola the 18th largest oil reserve holder in the world. Growth in Angola is expected to continue accelerating into 2025 at 2.8 percent after +2.4 percent in 2024 due to an increase in oil production, which is expected to reach 1.3 million barrels per day(bpd) in 2025.
Economic priorities: Angola is investing in agriculture, mining, and manufacturing to reduce its dependence on oil.
Oil refineries: Angola currently has two active refineries, one refinery in Luanda with a 65,000 barrels per day production capacity but currently only processes 45,000 barrels per day. It is operated by Sonangol Refinaria de Luanda and is a topping unit in Cabinda with a 16,000 barrels per day production capacity.
Lobito Petroleum Refinery Located in Benguela province, this refinery is proposed to have a production capacity of 200,000 barrels per day. Namibe Petrochemical Refinery Located in Namibe province, this refinery is proposed to have a production capacity of 400,000 barrels per day.
Oil-producing states: Angola’s oil-producing states include Cabinda, Congo River estuary, Soyo, and Luanda.
Economically developed states and capital: Luanda is both the capital and the primary economic center.
GDP: Angola’s GDP was $84.72 billion as of 2023
Angola’s crude oil production held steady at approximately 1.1 million barrels per day (bpd) in November 2024, mirroring its output from a year earlier.
This stability followed Angola’s high-stakes departure from OPEC in January 1, 2024, driven by clashes over production quotas that conflicted with its national policies and economic ambitions.
Oil dominates Angola’s economy amid growth hurdles: In 2024, Angola’s population reached an estimated 37.2 million, with oil contributing 90% of export revenues. The sector plays a crucial role in sustaining the country’s GDP of $113.3 billion nominally, with purchasing power parity (PPP) figures suggesting a broader economic footprint of $374.9 billion. This heavy reliance on oil underscores the resource’s dominance in Angola’s financial structure.
The decision to exit OPEC granted Angola greater flexibility in managing its oil output, positioning the country to stabilize and potentially increase production levels. However, this newfound independence comes at a cost.
Aging infrastructure and years of underinvestment remain significant obstacles, stymieing the country’s ability to capitalize on its resources and drive meaningful growth.
Global role and domestic imperatives
Angola’s steady production provides a consistent, though modest, contribution to global oil supply, influencing regional markets and price trends. Domestically, oil revenues are a lifeline for the economy, funding infrastructure and public services critical to development.
Yet, heavy dependence on hydrocarbons underscores the need for structural reforms and investment in non-oil sectors to secure sustainable growth.
The stakes are high for Angola as it navigates its post-OPEC trajectory. Balancing short-term fiscal stability with long-term economic diversification will be key to weathering global uncertainties while fostering a resilient, inclusive economy.
3. Algeria: Third-largest oil producer (908,000 b/d)
Projections: Along with gas, Algeria is a large oil producer with 12.2 billion barrels of proven oil reserves. The country exports 540,000 b/d of its total production of about 1.1 million b/d. All proven oil reserves are held onshore, though offshore exploration is in the early stages.
Economic priorities: The country is focusing on renewable energy, mining, and agriculture alongside its hydrocarbon sector.
Oil refineries: Skikda refinery with a capacity of 355,000 barrels per calendar day. It’s located on the northern coastline of Algeria and is operated by Sonatrach, the state-owned oil company.
Oil-producing states: Algeria’s main oil-producing areas are the Hassi Messaoud- in the northeastern Sahara, Zarzaïtine-Edjeleh- along the Libyan border El-Borma, and El-Borma fields located on the Tunisian border.
GDP: With a population of 46.28 million according to the World Bank, Algeria’s GDP was $266.78 billion as of 2023
Algeria’s crude oil production in November 2024 averaged 908,000 barrels per day (bpd), a marginal dip from 909,000 bpd in October.
The country’s economic backbone remains its oil and gas sector, which accounts for nearly 89 percent of export revenues.
Algeria’s extension aims to mitigate global oil price fluctuationsIn a bid to stabilize global oil prices, Algeria, in coordination with OPEC+, extended its voluntary output cut of 48,000 bpd until December 2024. The extension aligns with OPEC+’s broader strategy to balance the global oil market, with cuts now stretching into 2025 amid fluctuating demand and supply pressures.
Algeria faces economic crossroads: With an estimated GDP of $266.78 billion in 2024 and a population of 47 million, Algeria’s fiscal health is tightly coupled with the volatility of global oil prices. While rising oil prices can provide a boost to oil-dependent economies like Algeria’s, they also carry the risk of dampening global economic momentum.
Algeria’s November production figures reflect a modest decline, with OPEC+’s ongoing production cuts continuing to play a pivotal role in both local economic conditions and broader market stability.
4. Libya: Fourth-largest oil producer
Libya’s crude oil production has shown significant fluctuations throughout 2024, reflecting the nation’s complex political and economic landscape.
Oil production dynamics
In November 2024, Libya’s crude oil production increased to approximately 1.238 million barrels per day (bpd), up from 1.097 million bpd in October (Trading Economics). The rise followed a period of instability; in August, production had plummeted by about 63 percent due to oilfield closures amid political disputes (Reuters)
By December, the National Oil Corporation (NOC) announced that daily crude oil production had surpassed the 2024 target of 1.4 million bpd, reaching 1.4 million bpd (Libya Review)
The economic significance of oil:
Oil remains the cornerstone of Libya’s economy, accounting for a substantial portion of government revenues and export earnings. In the first quarter of 2024, oil revenues reached $6 billion, with annual revenues projected at $25 billion (Energy Capital & Power). The NOC has set ambitious goals to boost production to over 1.5 million bpd by the end of 2024 and 2 million bpd by 2025, aiming to enhance economic stability and growth (U.S. Energy Information Administration).
Challenges and outlook:
Despite these positive developments, Libya’s oil sector faces ongoing challenges, including political instability, infrastructure deficiencies, and security concerns.
The International Monetary Fund (IMF) projects GDP growth of nearly 8% in 2024, contingent upon stable hydrocarbon production and prices (International Monetary Fund). However, the IMF also warns of potential declines in fiscal and external balances in the coming years, highlighting the need for economic diversification and structural reforms to reduce dependence on oil revenues.
While Libya’s oil production has rebounded in 2024, contributing to economic growth, the nation must address underlying challenges to ensure sustainable development and stability in the future.
5. Egypt: Fifth-largest oil producer (537,000 b/d)
Egypt’s crude oil production has experienced fluctuations in 2024. In August, production decreased to 526,000 barrels per day (bpd) from 537,000 bpd in July, marking the lowest output since 1994 (Trading Economics).
Despite these challenges, Egypt is targeting a 9% increase in daily crude oil production for the fiscal year 2024/2025, aiming to reach 637,000 bpd from the current levels (AmCham Egypt). The oil and gas sector remains a cornerstone of Egypt’s economy, with the government implementing strategies to enhance energy efficiency and sustainability. The Energy Efficiency Strategy 2022-2035 aims to achieve 10 percent energy savings by 2027 and 18 percent by 2035, reflecting the Ministry of Petroleum and Mineral Resources’ commitment to decarbonizing the industry and strengthening energy security (Egypt Oil & Gas).
In July 2024, Egypt signed two strategic agreements with international companies, totaling $340 million, to boost oil and gas production in the Mediterranean and Gulf of Suez regions. The investments are part of broader efforts to strengthen the energy sector and increase production capacities (Reuters).
However, the country has faced challenges, including power blackouts during the summer of 2024 due to gas shortages. This situation led Egypt to resume LNG imports and allocate $1.2 billion for initial energy imports, including LNG cargoes mainly from the US (Financial Times). To address these issues, Egypt is focusing on attracting investments and implementing structural reforms to enhance the oil and gas sector’s efficiency and sustainability.
The government’s commitment to energy efficiency and the adoption of advanced technologies are crucial steps toward optimizing production and ensuring long-term economic growth (Egypt Oil & Gas).
6. Equatorial Guinea: Sixth-largest oil producer (500,000 b/d)
Equatorial Guinea’s oil production in November 2024 reached 0.06 million barrels per day (mb/d), showing a 20 percent rise compared to October’s 0.05 mb/d.
Nonetheless, it did not meet its OPEC-implied target of 0.07 mb/d, highlighting its operational constraints.
Compared to the same period in 2023, production has stayed fairly consistent, as Equatorial Guinea encounters difficulties in increasing capacity.
With a population of over 1.8 million and a GDP of close to $12.34 billion (2023 estimates), oil plays a crucial role in its economy, making up more than 50 percent of government income. The country’s failure to fulfill its OPEC quota, along with having no spare capacity, underscores its difficulty in maximizing resource use despite depending on oil exports.
Production obstacles, such as outdated infrastructure, insufficient funding for new initiatives, and possible operational inefficiencies, impede growth. These challenges limit Equatorial Guinea’s capacity to make a substantial contribution to the global oil market, where its production ranks among the lowest in OPEC.
Although the deficiency has little direct effect on global oil supply and prices, it highlights the larger issues encountered by smaller producers in the cartel. Economically, the production gap could pressure fiscal budgets, particularly if oil prices drop, highlighting the importance of diversification and capacity-building initiatives to maintain revenue and economic stability.
7. Gabon: Seventh-largest oil producer
In November 2024, Gabon’s oil production remained steady at 0.23 million barrels per day (mbpd), the same as in October, but it was 0.06 mbpd above its assigned OPEC target of 0.17 mbpd.In comparison to the same timeframe in 2023, Gabon’s output has marginally decreased, indicating wider issues in its oil industry.
Gabon, with a population nearing 2.5 million and a GDP of $19.39 billion. Gabon operates an oil-reliant economy where hydrocarbons make up about 40 percent of its GDP and 70 percent of its export revenue.
This heavy dependence makes variations in production especially significant for its economic stability.
The nation’s minimal excess capacity (-0.01 mbpd) suggests that it is functioning close to its highest sustainable output, which might stress resources.
Gabon encounters issues like outdated oil infrastructure, insufficient funding for new exploration, and political unrest, which have hindered production. Surpassing its OPEC quota could enhance immediate earnings but pose potential penalties or reputational concerns within the organization.
Gabon plays a minor role in global oil markets, yet when combined with other OPEC members, its overproduction helps alleviate supply limitations a bit, which may lead to more stable oil prices.
Economically, maintaining or enhancing production is vital for Gabon’s financial stability, but it also needs to achieve a balance by diversifying its economy to reduce risks associated with fluctuations in oil prices.
8. Republic of the Congo: Eight-largest oil producer
The Republic of the Congo’s oil and gas sector experienced notable developments in 2024, reflecting both opportunities and challenges.
Crude oil production trends
As of November 2024, the Republic of the Congo’s crude oil production increased to 268,000 barrels per day (bpd) from 265,000 bpd in October (Trading Economics).
Historically, the country’s production peaked at 437,000 bpd in May 2010, with a record low of 33,000 bpd in January 1977 (Trading Economics).
Economic significance of oil and gas
Oil remains a cornerstone of the Congolese economy, significantly contributing to government revenues and export earnings.
In 2024, the economy is projected to grow by 3.5 percent, supported by increases in both the oil (4.2 percent) and non-oil (3.5 percent) sectors (World Bank).
However, the volatility of oil production continues to pose challenges to economic stability.
Strategic shifts and investments
Facing declining crude oil production, the Republic of the Congo is pivoting towards natural gas to bolster its hydrocarbons output.
The government is preparing to launch a Gas Master Plan and a new Gas Code to attract investment in gas exploration and production (World Oil). This strategic shift aims to diversify the energy sector and enhance economic resilience.
Recent developments
In November 2024, Italian energy company Eni launched the hull of the Nguya Floating Liquefied Natural Gas (FLNG) facility, with a capacity of 2.4 million tons per annum (MTPA), to be deployed offshore in the Republic of the Congo.
Challenges and outlook
Despite these advancements, the Republic of the Congo faces challenges, including infrastructure deficits, debt distress, and the need for economic diversification.
The International Monetary Fund (IMF) emphasizes the importance of structural reforms to reduce dependence on oil revenues and promote sustainable growth (IMF eLibrary).
In summary, while the Republic of the Congo is making strategic moves to enhance its oil and gas sector, addressing underlying economic challenges remains crucial for long-term stability and development.
9. South Sudan: Ninth-largest oil producer
South Sudan’s oil sector, the backbone of its economy, has faced significant challenges and developments throughout 2024.
Crude oil production trends:
In early 2024, South Sudan’s oil exports were severely disrupted due to damage to the pipeline that transports approximately 70 percent of its oil through Sudan (International Monetary Fund).
This disruption led to a sharp decline in oil exports, causing substantial revenue losses for the government. By October 2024, South Sudan resumed oil exports via the Bashayer port on the Red Sea and expressed readiness to increase oil production (Sudan Tribune).
Before the civil war, the country’s crude oil production peaked at 350,000 to 400,000 barrels per day (bpd) (Reuters).
South Sudan is pursuing an ambitious plan to increase its oil production to 230,000 bpd in the short term, with a long-term goal of reaching 450,000 bpd (AEC Week).
Economic impact
The disruptions in oil production and exports have had a profound impact on South Sudan’s economy.
The International Monetary Fund (IMF) estimated a real GDP contraction of approximately 6% for the fiscal year 2023/24, driven by the decline in oil exports during the first half of 2024 (International Monetary Fund).
The economic slowdown is projected to continue into the fiscal year 2024/25 as the oil production shock persists.
Additionally, the African Development Bank projected a 5 percent contraction in real GDP for 2023/24 due to the vandalization of an oil pipeline amid the ongoing conflict in Sudan (African Development Bank).
The economy is expected to recover to 1 percent growth in 2024/25 as oil production and exports stabilize.
Challenges and outlook
South Sudan’s heavy reliance on oil revenues, which constitute about 90 percent of its exports and government revenue, makes its economy highly vulnerable to external shocks (African Development Bank). The recent disruptions have exacerbated an already dire economic situation, leading to unpaid salaries for civil servants and soldiers, increased inflation, and a depreciating currency (The Wall Street Journal).
The World Bank has highlighted the need for economic diversification to mitigate the impact of such shocks and promote sustainable growth (World Bank).
In summary, while South Sudan is making efforts to restore and enhance its oil production capabilities, the country faces significant economic challenges.
Addressing these issues will require not only stabilizing oil production but also implementing structural reforms to diversify the economy and reduce dependence on oil revenues.
10. Ghana
Ghana’s oil and gas sector experienced significant developments in 2024, marking a notable shift after years of declining production.
Crude oil production trends: In the first half of 2024, Ghana’s crude oil production increased by 10.7 percent year-on-year, reaching approximately 24.86 million barrels. This uptick reverses a four-year trend of declining output and is largely attributed to the commissioning of new wells under the Jubilee South East (JSE) project (PIAC Ghana).
Economic impact: The resurgence in oil production has positively influenced Ghana’s economic performance. In the first half of 2024, the country’s GDP grew by 5.9 percent, up from 2.8 percent during the same period in 2023. This growth was driven by a 8.1 percent expansion in the industrial sector, particularly in oil and gas (World Bank).
Despite this progress, challenges persist. Inflation peaked at over 54 percent in December 2022 but has shown signs of stabilization, dropping to 23.2 percent in February 2024. However, economic vulnerabilities remain, necessitating prudent fiscal management and diversification efforts (U.S. Department of State).
Strategic Initiatives and Future Outlook: Ghana is undertaking strategic initiatives to bolster its regional oil and gas market position. The government has launched an ambitious “Petroleum Hub” project to become the leading oil refiner in West Africa. This project, estimated at $60 billion and to be executed in three phases until 2036, plans to construct three refineries with a total capacity of 900,000 barrels per day, along with associated petrochemical facilities and infrastructure (Le Monde).
Additionally, Ghana is exploring the possibility of importing petroleum products from Nigeria’s Dangote Oil Refinery once it reaches full capacity. This move aims to reduce the cost of fuel imports, which currently amount to $400 million monthly, and to lower freight costs, potentially decreasing prices of goods and services domestically (Reuters).
In summary, Ghana’s oil and gas sector is witnessing a rebound in production, contributing to economic growth. The government’s strategic initiatives indicate a commitment to enhancing the sector’s capacity and regional influence. However, addressing economic challenges and ensuring sustainable development remain critical for long-term stability.
