Opening address to the 166th Meeting of the OPEC Conference

No 6/2014
Vienna, Austria
27 Nov 2014

by HE Abdourhman Ataher Al-Ahirish, Libya's Vice Prime Minister for Corporations and President of the OPEC Conference

Excellencies, ladies and gentlemen,

It is my pleasure to welcome you all to Vienna for the 166th Meeting of the OPEC Conference.

I would like to extend a special welcome to His Excellency Adil Abd Al-Mahdi, the new Minister of Oil of Iraq, who is attending a Meeting of the Conference for the first time as Head of his Country’s Delegation.

On behalf of all the Heads of Delegation, I would also like to thank his predecessor in office, His Excellency Abdul-Kareem Luaibi Bahedh, for his service to his country and for his valuable contributions to the work of the Organization.  We wish him further success in the future.

Excellencies, ladies and gentlemen,

It has now been a little more than five months since the Conference last convened here in Vienna to discuss the oil market situation.  At that time, we spoke of improving stability in the oil market resulting from the ongoing recovery of the world economy.

Since then, the global economic recovery has continued, although at lower levels, while the global oil market has seen ample supplies.

Given this backdrop – and even though some uncertainties remain – global economic growth in 2015 is expected to grow to 3.6 per cent from 3.2 per cent in the current year.

In line with this economic outlook, world oil demand in 2015 is forecast to grow by around 1.1 million barrels per day, with total world consumption at around 92.3 million barrels per day.

The bulk of this net oil demand growth will continue to come from non-OECD countries.

Non-OPEC oil supply is also anticipated to rise next year by 1. 4 million barrels per day to average 57.3 million barrels per day.  The region of ‘OECD Americas’ is expected to be the main non-OPEC contributor to this supply growth – supported by some increases in Brazil.

In terms of prices, the situation has changed in recent months.  Although the OPEC Reference Basket had been fairly stable during the last three and a half years, with the annual average ranging between roughly $105 and $110 per barrel since mid-June, the Basket has lost nearly 30% of its value – or more than $30 per barrel.

A careful look at the current situation suggests the recent fall in prices may not be exclusively attributed to oil market fundamentals.

Ample supply, moderate demand, a stronger US dollar and uncertainties about global economic growth have been key factors in this recent price trend.  In addition, as OPEC has noted in the past, the impact of speculative activity in the oil market has also been an important factor.

Nevertheless, it is important to recognize that if the recent price trend continues, the long-term sustainability of capacity expansion plans and investment projects may be put at risk.

Excellencies, ladies and gentlemen,

The recent price developments are a sign that the oil market is currently searching for stability and balance.  At today’s meeting, OPEC will consider these issues – and discuss the market outlook for 2015.

As always, our deliberations will be focused on contributing towards stability in the market.  This is what most benefits global economic growth – and it is what matters most to all stakeholders, producers and consumers alike.

We also recognize that dialogue has always been instrumental for the achievement of such goals.

That is why OPEC is committed to engaging further in international dialogue and cooperation efforts – through participation in meetings, symposia and workshops.  These include dialogue with the G20, the EU and Russia, as well as working programmes with the International Energy Forum, the International Energy Agency and other international institutions.

In conclusion, I should like to reiterate that such opportunities for dialogue and collaboration – with oil companies, non-OPEC producers, investors and consumers – make important contribution to our common endeavour of attaining stability in the oil market.

Excellencies, ladies and gentlemen,

Thank you for your attention.