FLASHBACK: Gabon Re-joins OPEC
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On July 1, 2016, Gabon officially re-joined OPEC, two decades after leaving it in 1995 following disagreements on membership fees.
In 1995, Gabon, the group’s smallest member, asked for lower fees to reflect its modest production level. OPEC refused the grants its request for reduced annual contributions. Contributions to the group’s budget are shared equally between members regardless of their production levels. Gabon’s request was rejected as the group considered that altering the principle of equal budgetary contributions should entail a change in the principle of equal voting rights. The combined annual fees of all members reached $1,79 million that year.
In 2016, Gabon Minister of Oil and Hydrocarbons Etienne Dieudonné Ngoubou met with Oand they discussed the market situation and what impact oil prices may have on producing countries. Indeed, at the time, the oil price was around $50 a barrel, close to $30 in early 2016, down from records above $100 between 2011 and mid-2014.
Although Gabon is currently designing an economic diversification strategy to decrease reliance to oil exports, one third of its budget and two thirds of its export revenue were exclusively from oil production, in 2016. Production levels were around 200,000-240,000 barrels per day, down from peak production in the 1990s, around 350,000 barrels per day.
By re-joining OPEC, Gabon was intending to participate in the multilateral discussions elaborating the strategy to support increasing oil prices globally. At the time, a stabilization plan backed namely by Algeria and Venezuela was being vetoed by Saudi Arabia. Stakeholders were aiming to co ordinate their strategies in order to reverse the slump in global oil prices, but OPEC member states had thus far failed to agree on lower production quotas, preferring instead to maintain market share, thereby contributing to keeping prices low.
In 2016, Gabon was the only Economic and Monetary Community of Central Africa (CEMAC) country to be member of OPEC. Since, it has been joined by Equatorial Guinea in May 2017.