OPEC 156th Meeting concludes

No 2/2010
Vienna, Austria
17 Mar 2010

The 156th Meeting of the Conference of the Organization of the Petroleum Exporting Countries (OPEC) convened in Vienna, Austria, on 17 March 2010, under the Chairmanship of its President, HE Germánico Pinto, Minister of Non-Renewable Natural Resources of Ecuador and Head of its Delegation, and its Alternate President, HE Masoud Mir-Kazemi, Minister of Petroleum of the Islamic Republic of Iran and Head of its Delegation.

The Conference marked this first Meeting to be held in the Organization’s new Headquarters’ Premises in Vienna with an inauguration ceremony attended by HE Dr Michael Spindelegger, the Austrian Federal Minister of International and European Affairs, HE Dr Michael Häupl, Mayor of the City of Vienna, the Heads of other Vienna-based international organizations and various high-level dignitaries.  In so doing, the Conference recorded its appreciation to the Government of the Federal Republic of Austria and the Government of the State of Vienna for providing the Organization with these new modern office premises.

The Conference reviewed the Secretary General's report, the report of the Economic Commission Board, the report of the Ministerial Monitoring Sub-Committee – whose Members the Conference thanked for their continuous endeavours on behalf of the Organization – and various administrative matters.  As customary, the Conference also exchanged views on, inter alia, the ongoing multilateral developments on environment matters and preparations for the forthcoming 12th International Energy Forum.

The Conference reviewed recent oil market developments, in particular supply/demand projections, as well as the outlook for 2010, and noted that, while the global economy is clearly rebounding from the late 2008 and early 2009 recession, with continued positive signals coming from the manufacturing and services sectors, serious threats remain.  Downside risks include: the mounting and potentially unsustainable public debt in the most advanced economies; a degrading fiscal position which might lead OECD governments to tighten fiscal and monetary policy, despite rising unemployment; weak demand; persistent global imbalances; and rising protectionism.

The Conference further noted with concern that, although world oil demand is projected to increase marginally during the year, this rise will be more than offset by the expected increase in non-OPEC supply, meaning that 2010 is likely to witness a decline in the demand for OPEC crude oil for the third consecutive year.  The persistently high OECD stock levels (estimated to currently stand at 59-61 days of forward cover i.e. well above their five-year average) indicate that there has been a contra-seasonal stock build in the first quarter 2010 and the overhang in terms of forward cover is expected to continue throughout the year.

In light of the foregoing, the Conference again decided to maintain the current oil production ceiling unchanged.  Member Countries reiterated their commitment to their individually agreed production allocations, thereby complying fully with the decision taken by Oran Conference in December 2008, just as they reaffirmed their readiness to swiftly respond to any developments which might place oil market stability in jeopardy.

Given the uncertainty in the macroeconomic environment and world oil demand, the Secretariat will continue to closely monitor developments in the months ahead, keeping Member Countries abreast of developments as they occur.  The situation will be reviewed at the next Ordinary Meeting of the Conference, which is scheduled to be convened in Vienna, Austria, on Thursday, 14 October 2010.

As always, in taking its decisions the Conference emphasized the commitment by the Organization and its Members to stabilizing the market, providing a regular supply of petroleum to consumers at price levels which not only are equitable for the world economy and consumers, but which also secure adequate future supply, in line with OPEC’s statutory objectives.

The Conference also decided that, among various events scheduled to mark the 50th Anniversary of the foundation of the Organization, an Anniversary Symposium would be held on a date to be coordinated between Iraq and the Secretary General.

The Conference listened to an updated presentation on Ecuador’s Yasuni-ITT initiative and reiterated its expression of support and interest, being of the view that this proposal is consistent with the energy and environment-protection objectives established at the Third Summit of OPEC Heads of State and Government.

The Conference passed Resolutions that will be published on 17 April 2010, after ratification by Member Countries.

Finally, the Conference again expressed its appreciation to the Government of the Republic of Austria and the authorities of the City of Vienna for their warm hospitality and the excellent arrangements made for the Meeting.