Daily Management Review

Situation in Algeria scares oil investors


Protests, which broke out 6 weeks ago in Algeria, have already involved millions of citizens of the country opposing current President Abdelaziz Bouteflika. A week ago, Exxon announced that it intends to suspend implementation of investment plans in the North African country.

This oil-and-gas-rich state, quite important for European investors, but the uncertainty is so high that they are ready to suspend their operations.

When Bouteflika announced that he intended to run for a fifth term, mass protests erupted in the country. This situation forced him to reverse his decision, but the protests did not subside. On the contrary, they have intensified and, judging by the mood of the protesters, they will continue until President leaves his post.

The most vivid fact about decline of Bouteflika’s career is that the large-scale protests in Algeria were broadcast live on three state channels. Usually local channels are silent about such events.

Bouteflika is losing support, and quite quickly, and now all attention is paid to the military grey eminence.

For the most part, they have already expressed themselves but this once again fueled the protests. This week the army commander urged to abide by the constitution in order to declare that the aging and sick Bouteflika is unable to continue to occupy the chosen position. However, for investors, everything that happens next is a complex transition process. The opposition leaders agreed with his roadmap, but uncertainty still rules.

The current presidential term ends April 28th. The opposition proposes to create a presidential authority that will rule less than 6 months. Its representatives will not be able to run for election or nominate after the transition period.

source: bloomberg.com