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8

OPEC bulletin 8–9/17

C o n f e r e n c e N o t e s

4

t h

M e e t i n g o f t h e J o i n t M i n i s t e r i a l M o n i t o r i n g C o m m i t t e e

Conference President says OPEC

and non-OPEC unity will make

the difference

In his opening remarks to the 4

th

Meeting of the JMMC in

St Petersburg, Khalid A Al-Falih, Saudi Arabia’s Minister of

Energy, Industry and Mineral Resources, and President of the

OPEC Conference, stressed that the continued unity among the 24

OPEC and non-OPEC participating countries of the ‘Declaration of

Cooperation’ will be the key ingredient to success in achieving a

stable and growing global oil market.

Al-Falih began his remarks with a brief tribute to the

Russian Federation and his colleague and host for the

occasion, Alexander Novak, Russian Minister of Energy.

“Itisapleasure tobebackinStPetersburg, and I would

like to thank Alexander Novak both for hosting this gath-

ering and for his tireless efforts and strong support for the

effective cooperation between OPEC and key non-OPEC

producers— including, of course, the Russian Federation.”

He went on to acknowledge the important work being

done by the JMMC, the JTC and their respective leader-

ship teams.

“I also want to acknowledge the efforts of the Joint

Ministerial Monitoring Committee under the leadership

of the Minister of Oil and Minister of Electricity andWater

of Kuwait, Issam A Almarzooq; the contributions of the

Joint Technical Committee; and the work of the OPEC

Secretariat and Mohammad Barkindo. I would note that

at our last meeting in May, delegates agreed to expand

the mandate of the JMMC to continue to monitor levels

of conformity and make additional recommendations, if

necessary, in light of changing market conditions.”

He then proceeded to outline the oil market develop-

ments that had transpired since the last meeting of the

JMMC, noting three important positive trends that were

developing despite the ongoing pressure placed on the

market due to uncertainty regarding supply and demand.

“First, almost a decade after the world economy was

rocked by financial turmoil, the global recovery has finally

become ‘broad-based and stable,’ according to most

major economic institutions,” he maintained. “Second,

oil demand is picking up, from moderate growth of 1m

b/d in the first quarter of the year to 1.5m b/d in the sec-

ond quarter, including rising demand growth in the key

consumingmarkets of China, India and the United States.

In coming years, we expect that oil demand will continue

to increase at a healthy pace.”

Decreasing inventories

And the third important trend he pointed out concerns

declining global inventories.

“And the third key positive trend is the reverse in the

build-up in global inventories. For example, US invento-

ries have fallen froma peak inMarch 2017 of about 538m

b to a little more than 490mb. The most recent data show

that OECD crude oil inventories as a whole are 250m b

above the five-year average, down from close to 340m

b in January. Over the first half of the year, our collective

efforts have pulled close to 350m b in aggregate from

global supply — so you can imagine where the market

would be had we not acted.”

Although this general upward trend is expected to

continue, he added that several challenges were to be

expected in the months ahead.