149th OPEC Conference reviews current oil market conditions
The 149th Meeting of the Conference of the Organization of the Petroleum Exporting Countries (OPEC) convened in Vienna, Austria, on 9th and 10th September 2008, under the Chairmanship of its President, HE Dr. Chakib Khelil, Minister of Energy & Mines of Algeria and Head of its Delegation, and its Alternate President, HE Desidério da Graça Verissímo e Costa, Minister of Petroleum of Angola and Head of its Delegation.
The Conference congratulated HE Eng. Mohammed Abdullah Al-Aleem on his appointment as Minister of Oil of the State of Kuwait and Head of its Delegation.
The Conference warmly welcomed the Minister of Petroleum of Egypt, the Deputy Prime Minister of the Russian Federation and the Minister of Energy & Mining of the Republic of Sudan, representatives of non-OPEC oil-producing countries with whom the Organization seeks concrete and constructive dialogue in the interests of maintaining order and stability in the oil market.
The Conference considered the Secretary General's report; the report of the Economic Commission Board; the report of the Ministerial Monitoring Sub-Committee (MMSC), chaired by HE Gholamhossein Nozari, Head of the Delegation of the Islamic Republic of Iran, whose Members the Conference again thanked for their continued efforts on the Organization's behalf; and various administrative matters.
The Conference exchanged views on, inter alia, recent developments in environment-related multilateral discussions and the outcome of the 5th Ministerial Meeting of the EU-OPEC Energy Dialogue.
Member Countries took this occasion to reiterate their abiding commitment to working with the international community towards achieving energy market stability and security, enhancing socio-economic development, alleviating poverty and protecting the environment, recognizing that energy is central to the achievement of the Millennium Development Goals.
The Conference reviewed current oil market conditions and future prospects and observed that production action taken by OPEC Member Countries has ensured that the oil market is well supplied and has enabled inventories to be built up to comfortable levels in terms of forward demand cover.
It further noted that prices have dropped significantly in recent weeks, driven by a weakening world economy, in particular in major OECD countries, with its concomitant lower oil demand growth, coupled with higher crude supply, a strengthening of the US dollar and an easing of geopolitical tensions. All the foregoing indicates a shift in market sentiment causing downside risks to the global oil market outlook.
Since the market is over-supplied, the Conference agreed to abide by September 2007 production allocations (adjusted to include new Members Angola and Ecuador and excluding Indonesia and Iraq), totalling 28.8 mb/d, levels with which Member Countries committed to strictly comply.
Further, given the role played by oil market stability in the world economy, the Conference reaffirmed its commitment to ensuring sound supply fundamentals and an adequate level of spare capacity for the benefit of the world at large.