Voters in Guyana will cast their ballots on September 1, 2023, to elect a new parliament and president. Current President Irfaan Ali of the People’s Progressive Party (PPP) is vying for a second and final term. The upcoming elections come amid significant economic changes fueled by the country’s burgeoning oil sector.
The PPP won the last elections in 2020, securing a 33-seat majority in the 65-seat Parliament. While recent opinion polls suggest that the PPP is likely to win the most seats once again, a majority is not guaranteed. Should the party fall short, it may need to form a coalition to advance its legislative agenda.
Opposition parties are expressing discontent with the government’s handling of oil revenues. Many critics argue that not all citizens are benefiting from the spending programs financed by oil income, and they contend that overall quality of life has not improved for all residents. Three opposition parties have committed to pushing for a larger share of the benefits from the contract with ExxonMobil, which leads the oil production projects in Guyana. However, ExxonMobil has stated that it will not reopen negotiations on the existing contract, which the PPP and President Ali prefer to maintain as is.
Economic Impact of Oil Production
Guyana’s economy has experienced remarkable growth, largely attributed to its oil production capabilities. Recent developments have seen the country’s oil output rise to 900,000 barrels per day (bpd) following ExxonMobil’s launch of production from the Yellowtail project, the fourth in the highly productive Stabroek block. The Stabroek block has proven to be a valuable asset, with more than 11 billion oil equivalent barrels discovered. Prior to Yellowtail’s production, output was already exceeding 660,000 bpd.
The offshore oil field’s performance is significant, yielding substantial revenue potential for ExxonMobil and its partners. Even with fluctuating oil prices, Chevron and ExxonMobil stand to gain, as the breakeven price for operations in the Guyana block is estimated to be around $30 per barrel.
As the election approaches, the impact of oil wealth on governance and public welfare remains a central issue. The ruling party’s ability to effectively manage and distribute these resources could influence voter sentiment.
With the country’s economic landscape shifting rapidly, the upcoming elections will not only determine political leadership but also shape the future trajectory of Guyana’s oil-driven prosperity. The outcome may signal whether the benefits of oil wealth will be equitably shared among all Guyanese citizens or concentrated within select groups.
