Angola’s public debt will hit its ceiling in the next few years, the International Monetary Fund warned, advising the country to deploy an expected windfall from rising oil prices toward reducing debt and building buffers.

Africa’s oil-producing nations are set to receive a revenue boost due to shortened supply of oil on the international market due to the Iran war, with Nigeria estimated to be on track for a $3.6 billion windfall. Angola, Africa’s top recipient of Chinese loans and the continent’s second-largest oil producer after Nigeria, set a benchmark oil price of $61 for this year’s budget. The jump in crude prices above $100 a barrel could “provide a temporary offset to Angola’s declining oil revenues,” the IMF said. But the government would need to speed up revenue mobilization and fuel subsidy reforms to reach debt sustainability targets, the Washington-based lender said.

Several other African nations are still recovering from a post-pandemic shock that sent debt burdens soaring, and inflationary pressures triggered by the Iran war now risk undoing that progress. Malawi, Mozambique, and Senegal are in debt crisis situations that could lead to defaults in the next two years, Citi’s chief Africa economist has warned.