Angola's Finance minister, Vera Daves de Sousa, admitted in an interview with the Lusaka news agency in London that public expenditure on fuel subsidies is expected to soar to 2.48% of Gross Domestic Product by December 2026, a significant increase compared to the 0.9% estimated in the State Budget, due to rising oil prices.
The 2026 State Budget is calibrated for an average production of 1.050 million barrels per day, although the country is currently operating around 1.040 million barrels daily. Despite the volume being slightly below forecast, revenue is benefiting from a barrel price significantly higher than the 61 dollars considered in the initial budget scenario.
The government official stated she prefers "not to get too enthusiastic" about the increase in oil revenues, prioritizing debt service and the acceleration of normal budget expenditures. In 2024, from a four billion dollar eurobond issuance, 1.2 billion were used in a liability management operation to repurchase bonds maturing in 2028 and 2029.
Vera Daves de Sousa justified the caution in completely removing fuel subsidies citing existing weaknesses in mobility and social protection coverage. The executive is analyzing the reinforcement of the bus fleet and the surface metro project in Luanda, and it is necessary to extend social transfers to urban areas before proceeding with the complete removal of subsidies, which would not be "politically and socially responsible" without these guarantees.
