WSJ: Fall in Oil Prices Threatens Africa’s Economic Growth

Plunging oil prices are threatening Africa’s economic ascent. Recent oil and gas discoveries were hailed as a godsend for African nations aspiring to middle-income status. But billions of investment dollars are moving into projects just as crude prices have tumbled, raising fears that some may be put on hold.

Total, Exxon Mobil and other companies are at work on a $16-billion oil project in Angola that will be profitable only if oil prices average more than $70 a barrel, Citigroup analysts estimate. The price of Brent crude closed at a new five-year low on Thursday, falling nearly 1%, or 56 cents, to $63.68 a barrel.

Anadarko Petroleum and Eni SpA have spent more than $5 billion developing natural-gas fields in Mozambique that threaten to become much less profitable if global supply expands too rapidly. Ugandan officials say they fear lower oil prices could deter companies, including Tullow Oil and China’s Cnooc, from following through on plans to invest up to $15 billion to develop the country’s oil fields.
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