The oil era in Algeria is coming to an end

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Algeria has been an OPEC member since 1969 and is the third largest supplier of pipeline gas and oil to Europe, with hydrocarbon exports providing 60% of the country’s budget. However, the Covid-19 pandemic has walloped Algeria’s already stretched finances and put even more stress on its lifeblood oil industry. As the global decline in fuel prices this year forced the Algerian government to reduce public spending by 50 percent, as the state budget suffers from a financial deficit of more than 16 percent.

The Minister Delegate to the Prime Minister in Charge of Prospecting, Mohamed Cherif Belmihoub, said that Algeria will be unable to export a single barrel of oil by 2025 if the current rate of consumption continues.

Belmihoub, who was a guest at the “Chaab” newspaper forum, considered that Algeria is a non-oil country, and this is contrary to what was promoted in previous periods.

He stressed that Algeria is a small petroleum country, which reflects its 13th position in OPEC, which is considered a very late position.

Belmihoub explained in his statement that the domestic consumption of fuel is becoming very high in Algeria.

The spokesman considered, “The matter is very positive and gives a rosy picture, but the public opinion must know that individual consumption is much greater than industrial consumption.”

The Minister Delegate added in this context: “Continuing this approach in 2025 until 2030 makes Algeria unable to export a single barrel of oil.”

The American “Brookings” Institute revealed last December shocking data about the Algerian oil industry, after confirming that the latest prospecting studies carried out by the International Monetary Fund indicate that the country’s reserves of oil and gas will soon run out.

According to the same study, Algerian oil wells will be completely depleted by 2035, while natural gas reserves will run out in 2050.

These data would put Algeria in front of a very big dilemma, as the country’s budget relies at 60 percent on gas and oil revenues, while these two articles constitute approximately 94 percent of the total exported goods.

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