Africa keeps going despite high oil prices

Kampala: Record high global oil prices have so far had a muted effect on sub-Saharan Africa, with exporters reaping rewards and importers less badly hit than many had feared.

A combination of demand, refinery bottlenecks and political fears drove crude oil to a record high last week. But economic worries, the debt market squeeze and falling stock prices have knocked US oil from an all-time high of $78.77 struck last week.

While the poorest on the world’s most impoverished continent are paying the price, the impact has not been the disaster some forecast.
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The largest threat is to infrastructure projects, many funded by donors like the African Development Bank (AfDB), which were planned when oil prices were much lower.

In a report last year, the Tunis-based AfDB said many ongoing thermal power production projects were in danger because they were set up on the assumption that oil prices would remain at around $25 a barrel.

It hopes higher prices to spur governments to invest in cleaner, alternative energies like solar and wind power.

Gulfnews