Cape Town - Fears that instability will spread further through the oil-supplying Middle Eastern and North African region in North Africa have driven the oil price above 2008 levels. The civil war in Libya has halved oil production in that country. And though the regional uprisings have not spread to Saudi Arabia, the world's most important oil producer, tensions rose when Saudi troops fired rubber bullets on street protestors last week.
These events will further hasten the scramble by both the East and the Western to carve for themselves a reliable supply of oil from Africa - dubbed the last oil frontier.
African oil comprises 13% of global supply, though proven reserves are just 9% of the world's known oil reserves. This is a fraction of the Middle East's 62%. "Africa is punching above her weight," Dr Duncan Clarke, oil researcher, consultant and CEO of Global Pacific and Partners SA, told delegates at the 5th annual Africa Economic Forum this week. "This is a modern scramble for resources in an energy hungry world."
In this scramble, Africa is increasingly important, particularly to the United States and China. They are, respectively, the world's biggest and third biggest (after Japan) importers of oil. The US, for example, wants a quarter of its crude imports to come from Africa within the next six years; already, Algeria, Angola and Nigeria combined supply almost 20%. China sources almost one-third of its imported oil from Africa, mostly from Angola, Sudan and Equatorial Guinea.
But the US and China are not the only ones eyeing Africa's oil. About 500 companies - from the oil majors, and state owned petrochemical firms like Petronas and SA's PetroSA to smaller exploration and drilling firms, are currently invested in Africa's oil industry. New entrants arrive every month. They are not all foreign owned either. According to Clarke, more and more African players are investing in the sector. "African private oil companies now number over 100 and come from 20 countries - a far cry from a decade ago," he says.
In parallel, oil is being discovered in more and more African countries. These include significant finds in Uganda, Ghana and Sierra Leone. Madagascar has discovered 15bn to 20bn barrels of heavy oil. And Niger will become an exporter of oil this year. There are also new discoveries in older oil and gas markets such as Nigeria and Angola. By 2030 there could be 40 African oil producers, from seven in the 1970s.
Though oil has been produced in Africa for 50 years, it is in the past decade that exploration and production has ramped up - as global oil consumption began to rise sharply. In the late 1980s Africa had about 60bn barrels of proven oil reserves. Today, Africa-wide oil reserves stand at about 120bn barrels - more than Russia's reserves.
"Africa stands at the beginning of a vast opportunity," says Clarke. "One that could drag her into a modern economy." Oil, far from being a curse, could actually save Africa, he says.
That is a bold statement in a continent that has failed to convert its oil wealth into meaningful social change for her people. To date no African nation has developed its people, infrastructure and economy on the back of its oil wealth. The converse is true and Nigeria is a prime example. Though that country has generated oil revenues in excess of US$350bn since independence, income has fallen by 1.5% per person per year, for the past 30 years.
Gabon, which produces 300 000 barrels per day and has one of the highest GDP rates per capita in Africa, has 60% of its population living on less than $1 per day.
Tony Hawkins, a professor at the graduate School of Management Zimbabwe, argues that oil is a "corrupting substance". Far from putting the oil wealth to effective public use, as has been done in Scandinavia, Alaska and the Gulf, Africa's oil bounty has seen her people grow poorer and their leaders richer.
An economy based purely on oil exports is not sustainable. "Eventually commodity super cycles must come to an end," he says. "African countries need to diversify their economies and grow their consumer base - the oil industry does not create jobs. "
Clarke is not ignorant of these facts. But governance is improving and democracy is spreading - even if it is haphazardly. The oil and gas landscape is changing fast. More companies enter the continent each year, and investment commitments and numbers of projects executed are rising - these generate secondary industries.
"I think competition will intensify over time as more players compete and the foreign state oil companies add to the overall portfolio."
The opportunities do not end there. Another growth area lies in gas. Clarke says with 500trn cubic feet of gas now proven in Africa, the continent's total hydrocarbon reserves stand at about 250bn barrels of oil equivalent. "The future for gas is very strong, with more reserve growth, discoveries and markets being developed, as well as exports to Europe and within Africa," Clarke says.
This bodes well for Africa's economic development - as long as the oil wealth is used constructively to develop infrastructure and unrelated industries. And if it's used to finance short-term consumption? Then nothing changes.