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Annual Report 2016

could not continue in the same way. Eventually the

idea of having energy stakeholders around the world

engage in broad discussions took hold. In this, OPEC

played a leadership role.

As it has done many times before, during similarly

challenging times, OPEC began to intensify its long-

standing dialogue with other global actors in the energy

industry and the oil market in particular. Broad consul-

tations, which the Organization had been having since

the second half of 2015, were expanded to include non-

OPEC oil producers from around the world. These and

other discussions centred on the possibility of finding a

way to realize a broad-based rebalancing of the market

and put it on a path of sustainable stability.

Amid these extensive bilateral and multilateral dis-

cussions, the Organization’sMember Countries reached

a landmark decision at the 170th (Extraordinary) Meet-

ing of the Conference held in Algiers, Algeria, on 28 Sep-

tember 2016. At that meeting, OPEC delegates agreed

to overcome differences and seek a collective decision

for the good of the market, the industry, and producers

and consumers everywhere. The OPEC Conference thus

opted for a production level between 32.5 and 33.0

million barrels per day (mb/d) in support of the ongo-

ing drawdown of the stock overhang — and to bring the

necessary rebalancing forward.

During the latter half of 2016, OPEC continued

to use other platforms — such as the G24 Ministerial

Meeting and the IMF/World Bank meetings in Wash-

ington (7–9 October), as well as the World Energy

Congress in Istanbul (10–13 October) — to undertake

additional consultations with non-OPEC producers. In

the process, they shared outlooks and perspectives

regarding the market’s challenges, considered how to

advance the idea of joint collaboration, and discussed

the possible implementation of a broad-based produc-

tion adjustment.

Given the importance of holding extensive ex-

changes of perspectives on the challenges ahead,

additional platforms were used to confer with other

producers. These consultations were not only held

during plenary sessions nor did they only take place

within the context of formal events. In my capacity as

Secretary General, personal visits to nearly all Member

Countries were arranged during the final months of

2016 in an effort to consolidate the decision reached

in Algiers. These visits included high-level meetings in

Algeria, IR Iran, Iraq, Kuwait, Qatar, Saudi Arabia, the

UAE and Venezuela.

These personal consultations certainly contrib-

uted to a strengthening of the implementation of the

production decision reached in Algiers; but they also

provided the foundations of what would later become

the first High-Level Committee Meeting of Member

Countries held on 28 October. This meeting focused

on implementation of the production decision, as well

as on development of a framework for holding similar

high-level consultations between OPEC and non-OPEC

producing countries. This was followed on 29 October

by a meeting between OPEC and key non-OPEC produc-

ers, which was held at OPEC headquarters in Vienna.

The participation of several important countries

in these consultations, and the broad recognition that

the market required collaborative decisions on the part

of producers everywhere, led to a successful outcome.

Participating countries agreed that the OPEC and non-

OPEC dialogue should be institutionalized, and the

ensuing discussions emphasized the importance of

finding a way of achieving concrete results with regard

to production.

These were promising first steps. Nearly a month

later, at the second High-Level Committee Meeting,

delegates concluded once again that credible action

on the part of producers was needed, otherwise the

rebalancing of the oil market would remain elusive. A

week later, on 30 November, the 171st Meeting of the

OPEC Conference was held in Vienna, at which Mem-

ber Countries reached a concrete decision to adjust

oil production by 1.2 mb/d, effective 1 January 2017.

This decision also further established a framework for

structured, sustained and transparent dialogue and

collaboration with non-OPEC countries.

These various inter-related efforts eventually

culminated in the decision reached on 10 December.

This involved not just all 13 OPEC Member Countries

but also 11 key non-OPEC producers. After extensive