Mozambique plans to supply petroleum products to Zimbabwe, Malawi, Zambia and the Democratic Republic of Congo (DRC), as the Southern African nation moves to become a major oil exporter within the next five years.
Oiltanking, a German company with operations in the country, is considering the construction of a new terminal in Mozambique’s Port of Beira to facilitate the import of oil products to supply the aforementioned nations.
While Mozambique’s government expects the move to boost the nation’s economy, it comes at a time when global oil prices have been on a decline in recent years. The price of crude oil fell by more than half to $58 this year from $110 in 2014. Nonetheless, experts from energy hedge fund Again Capital said in early December that prices could reach as high as $67 a barrel.
Traders this week said market conditions were relatively tight due to ongoing supply cuts led by the Middle East-dominated Organization of the Petroleum Exporting Countries (OPEC), and Russia, one of the world’s top producers.
Oanda, a Singaporean brokerage firm, confirmed on December 28th that global oil prices were stable at the time with trading activity drying up ahead of the New Year weekend.
Roughly a week ago, Oiltanking set up a new oil storage facility in Matola, a municipality in Mozambique.
The Matola terminal, Oiltanking’s first petroleum products facility on the African continent, offers an excellent access to fuel importers in the Eastern half of South Africa, as well as Botswana, Zambia, Zimbabwe and the Southern provinces of Mozambique.
The company has so far expanded its investments in the ports of Matola and Beira by increasing its direct stake in Oiltanking Mozambique from 60 to 80 percent.