(Business in Cameroon) - Regardless of the scale of the Coronavirus crisis, CEMAC oil-producing countries will suffer a violent oil shock.

Based on macro-economic data available as of March 22, 2020, the Steering Committee of the Economic and Financial Reform Program of CEMAC (PREF-CEMAC) has outlined two scenarios.

The first scenario assumes that "the crisis will be transitory and rapidly controlled.” Under that scenario, the price of a barrel of oil could be $39.1.

The second scenario assumes “a rapid spread of the crisis with, among other things, lowering average price of oil to $20 dollars per barrel in 2020 (pessimistic scenario)."

According to PREF-CEMAC, in the transitional scenario, the cumulative losses of oil revenues in the Cemac zone will amount to a little more than XAF992 billion. These revenue losses could triple if the Covid-19 crisis worsens, the committee indicates.

If the so-called pessimistic scenario were to occur, the five oil-producing countries in the CEMAC region would lose a total of XAF2,653.7 billion, the committee adds.

Overall, the shock will not be felt to the same extent in all the countries of this Community. Equatorial Guinea, Congo, Gabon and Chad will be more affected by this fall in revenue since oil often contributes up to 80% of their revenues against 25% in Cameroon.  

Brice R. Mbodiam