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7

OPEC bulletin 3–4/17

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

stability in the oil market — in the interest of oil produc-

ers, consumers and the industry. The Committee there-

after reiterated its resolve to full and timely conformity

to the decisions.”

Almarzooq said the task of the JMMC was to discuss

oversight and conformity issues and report its findings to

the OPEC/non-OPEC Ministerial Meeting, due to be held

on May 25. “So far, we have seen some progress with

very positive signs that the conformity from both OPEC

and non-OPEC countries has successfully been demon-

strated to the outside world,” he asserted.

“In addition, production numbers for January

and February were well received and the market has

responded affirmatively to the determined efforts of all

participating countries.”

The Minister said he wanted to emphasize that some

producers had over-performed. “They certainly deserve

recognition for their efforts. So I would like to expressly

offer my appreciation to both Angola and Saudi Arabia

for conforming beyond expectation. I hope their achieve-

ments will motivate other participants to reach their own

goals and perhaps to even go further.”

He noted that some other countries had not been able

to meet their production adjustments due to temporary

difficulties.

“I would like to candidly say that, in general, more

has to be done. We need to see conformity across

the board. We assured ourselves — and the world

— that we would reach our adjustment to 100 per cent

conformity.

“Our voluntary adjustment is and will remain 100

per cent and although this should be seen as a collec-

tive effort, individual countries also need to take their

conformity very seriously.

“If we reach our common objective, we could see bal-

ance returning to the market by the third quarter of 2017.

If not, this date may be pushed further out,” warned

Almarzooq.

The Minister stated that as the JMMC had observed,

over the past couple of weeks stocks remained stub-

bornly high, particularly in the US, where a seasonally

rising trend had hit new historically high levels.

“We have also seen some traders liquidate their long

positions and Brent prices have dropped from the mid-

50s to the low-50s. Volatility has also increased.”

At the same time, said the Minister, while invest-

ments may be returning in some of the industry’s

short-cycle projects, there was little investment going

into the long-cycle projects that were the baseload of the

industry.

“All this should focus our minds. We need to further

intensify our efforts. The uncertainty we have witnessed

may continue until the trend of inventory drawdowns

asserts itself and the market becomes more comfortable

with its capacity to absorb additional marginal supplies.”

The Minister reminded delegates that there would

The Jumeirah Messilah Beach Hotel in Kuwait, which hosted the meeting.