Africa: Oil prices batter key economies

The recent sharp fall in oil prices will add to headwinds facing the economies of Nigeria and Angola. We estimate that both country’s export revenues will have fallen by about a US$1bn over the past month. This will provide a big hit to government revenue, particularly in Angola. Nigeria and Angola are both running current account surpluses, and we doubt that recent oil price falls will be enough to completely erode these. But the fall in export earnings will still put more pressure on the BNA, Angola’s central bank. The fall will, on the other hand, boost domestic incomes in oil importers, notably Kenya and South Africa.