170th (Extraordinary) Meeting of the OPEC Conference
28 Sep 2016
The Conference of the Organization of the Petroleum Exporting Countries (OPEC), following a Consultative Meeting in Algiers, Algeria, resolved to convene an Extraordinary Meeting of the Conference on Wednesday, 28th September 2016 under the Chairmanship of its President, HE Dr. Mohammed Bin Saleh Al-Sada, Qatar’s Minister of Energy and Industry and Head of its Delegation.
The Conference expressed its respect and deep appreciation to the President of Algeria, HE Abdelaziz Bouteflika, and to the Prime Minister, HE Abdelmalek Sellal, for hosting the 170th (Extraordinary) Meeting of the OPEC Conference. The Conference, furthermore, acknowledged and thanked HE Noureddine Boutarfa, Algeria’s Minister of Energy, for his untiring efforts and support for the ongoing consultations between all parties involved in the preparations for these meetings. At the same time, the Conference also congratulated HE Noureddine Boutarfa, who was attending a Meeting of OPEC Ministers for the first time since his appointment as Algeria’s Head of Delegation, and thanked his predecessor in office HE Dr. Salah Khebri, for his contribution to the work of the Organization.
The Conference warmly welcomed Gabon that was attending a Meeting of OPEC Ministers for the first time since officially rejoining the Organization in July, and HE Jabbar Ali Hussein Al-Luiebi, who was also attending a Meeting of the Conference for the first time since his appointment as Iraq’s Minister of Oil and Head of its Delegation.
In the last two years, the global oil market has witnessed many challenges, originating mainly from the supply side. As a result, prices have more than halved, while volatility has increased. Oil-exporting countries’ and oil companies’ revenues have dramatically declined, putting strains on their fiscal position and hindering their economic growth. The oil industry faced deep cuts in investment and massive layoffs, leading to a potential risk that oil supply may not meet demand in the future, with a detrimental effect on security of supply.
The Conference took into account current market conditions and immediate prospects and concluded that it is not advisable to ignore the potential risk that the present stock overhang may continue to weigh negatively well into the future, with a worsening impact on producers, consumers and the industry.
Based on the above observations and analysis, OPEC Member Countries have decided to conduct a serious and constructive dialogue with non-member producing countries, with the objective to stabilize the oil market and avoid the adverse impacts in the short- and medium-term.
The Conference concurs that there is firm and common ground that continuous collaborative efforts among producers, both within and outside OPEC, would help restore the balance and sustainability in the market.
At this juncture, it is foremost to reaffirm OPEC’s continued commitment to stable markets, for the mutual interests of producing nations, efficient and secure supplies to the consumers, with a fair return on invested capital for all producers.
The Conference, following the overall assessment of the global oil demand and supply balance presented by the OPEC Secretariat, noted that world oil demand remains robust, while the prospects of future supplies are being negatively impacted by deep cuts in investments and massive layoffs. The Conference, in particular, addressed the challenge of drawing down the excess stock levels in the coming quarters, and noted the drop in United States oil inventories seen in recent weeks.
The Conference opted for an OPEC-14 production target ranging between 32.5 and 33.0 mb/d, in order to accelerate the ongoing drawdown of the stock overhang and bring the rebalancing forward.
The Conference decided to establish a High Level Committee comprising representatives of Member Countries, supported by the OPEC Secretariat, to study and recommend the implementation of the production level of the Member Countries. Furthermore, the Committee shall develop a framework of high-level consultations between OPEC and non-OPEC oil-producing countries, including identifying risks and taking pro-active measures that would ensure a balanced oil market on a sustainable basis, to be considered at the November OPEC Conference.
Finally, the Conference again expressed its deepest appreciation to the Government and to the people of Algeria, and to the authorities of the City of Algiers for their warm hospitality and the excellent arrangements made for the Meeting.
HE Barkindo with OPEC Conference President and Algeria's Minister of Energy (right to left)
OPEC Ministers of Saudi Arabia, Algeria, Qatar and Nigeria with the Secretary General
OPEC Ministers with the Secretary General