OPEC : Opening address to the 158th (Extraordinary) Meeting of the OPEC Conference

Opening address to the 158th (Extraordinary) Meeting of the OPEC Conference

No 10/2010
Quito, Ecuador
11 Dec 2010

by HE Wilson Pástor-Morris, Minister of Non-Renewable Natural Resources of Ecuador and President of the Conference

Excellencies, ladies and gentlemen,

Welcome to Quito for the 158th (Extraordinary) Meeting of the OPEC Conference.

This is the first time we have had the honour of hosting a meeting of the Conference since my country, Ecuador, reactivated its Membership of the Organization three years ago.  Previously, we had invited Their Excellencies, the distinguished Heads of Delegation, to Quito in 1974 and 1982.  Much has changed in the meantime, of course, for the industry, for OPEC and for Ecuador.  However, the fundamental needs of producers and consumers remain the same, namely stable markets, reasonable prices, secure supply and demand, and fair returns to investors.

Since rejoining the Organization, Ecuador has shared, once again, both the benefits and the responsibilities of Membership with our fellow oil-producing developing countries.  During this period we faced and are continuing to face many challenges as doubts and uncertainties remain about the outlook for the world economy in the coming year, and these will continue to have an impact on the oil sector.  Ecuador's ability to cope with the present situation has been reinforced by its Membership of OPEC and demonstrates the importance of dialogue and cooperation within the industry.

When His Excellency Economista Rafael Correa Delgado became President of Ecuador in January 2007, it was decided that the country would become more assertive over its sovereign rights in the running of its oil industry.  This was in the spirit of landmark declarations by OPEC, such as the Declaratory Statement of Petroleum Policy in Member Countries of 1968 and the three Solemn Declarations of our Heads of State and Government of 1975, 2000 and 2007.  In doing this, we have frequently sought - and gratefully received - the wisdom and counsel of other Member Countries. We look forward to their continued support in this area in the future.

As you are already aware, Ecuador has been pursuing a visionary scheme to conserve indefinitely an area in the Yasuni National Park that is rich in biological diversity.  The Park offers the world an array of plants and animals some of which you would not find in any other part of the world.  Our willingness to conserve this area is a demonstration of our commitment to the common benefit of mankind.

Focusing now on today's meeting, this comes just two months after our last Conference in Vienna on 14 October.  Oil prices have strengthened since then, with the dollar price of OPEC's Reference Basket reaching the high '80s last week.  Despite the brief price rises in April this year, we have to go back to early autumn 2008 to see such levels again, and that was just before prices began their steep decline to around $33 a barrel in late-December of that year, as a result of the financial crisis.  The recent rise in the Basket price has been driven by bullish sentiment in the futures market, attributable mainly to the weaker United States dollar.  Nevertheless, there is a general feeling in the market that prices at today's levels are comfortable for both producers and consumers, as well as for the global economy.

The performance of the oil market, which remains well supplied with crude, continues to be influenced heavily by the state of the world economy, and there are still many uncertainties here.  Perhaps there is a little more cautious optimism around than there was when we last met in Vienna two months ago.  But nothing can be taken for granted, and, as we have seen all-too-often in the recent past, the situation can change radically in a very short time and with little warning.

However, our Secretariat has been monitoring oil market developments, and we shall study its report and recommendations at today's meeting, when we review the outlook for the winter months in the Northern Hemisphere and for 2011 as a whole.  Our present production agreement has held out well since it was introduced at the 151st Conference in Algeria two years ago.  Producers and consumers agree that is has lent valuable support to the improved level of market stability we have seen since then.

Finally, let me point out once again that oil market stability is the responsibility of all parties - OPEC and non-OPEC producers, consumers and other influential groups, such as the financial institutions.  All parties stand to gain from stability, and so all parties must contribute to achieving it and sustaining it.

Thank you for your attention.