Vienna, Austria - 05 Mar 2020
In view of market developments and following OPEC’s 178th Extraordinary meeting today, the Heads of Delegation of the OPEC Conference held further consultations and decided to recommend extending the duration of the proposed 1.5 million barrel per day additional adjustment until the end of 2020, instead of 30th of June 2020.
The consultations, monitoring and constant review undertaken of current market conditions demonstrate the strong commitment of OPEC Member Countries to work together to restore oil market stability. Declaration of Cooperation members are determined to jointly rise to meet the current pressing challenge.
OPEC 178th (Extraordinary) Meeting of the Conference concludes
Vienna, Austria - 05 Mar 2020
The 178th (Extraordinary) Meeting of the Conference of the Organization of the Petroleum Exporting Countries (OPEC) was held in Vienna, Austria, on Thursday, 5 March 2020, under the Chairmanship of its President, HE Mohamed Arkab, Minister of Energy of Algeria and Head of its Delegation.
The Conference took note of the announcement from Ecuador that it has withdrawn from its Membership of OPEC, with effect from 1 January 2020.
The Conference recalled the First OPEC Summit held from the 4-6 March 1975, exactly 45 years ago, in Algeria. The Summit saw the establishment of OPEC’s sister organization, the OPEC Fund for International Development. The Conference acknowledged Dr Abdulhamid Alkhalifa, Director-General of OFID, and his able staff, for their great achievements in contributing to reducing poverty and improving the lives of millions of people around the globe.
The Conference reviewed the report and recommendations of the Joint Ministerial Monitoring Committee (JMMC), whose work continues to be ably supported by the Joint Technical Committee (JTC) and the OPEC Secretariat.
The Conference took note of oil market developments since it last met in Vienna on 6 December 2019 and reviewed the oil market outlook for the remainder of 2020.
It noted the positive ramifications of the decision to further voluntarily adjust production at the 177th Meeting of the Conference, and subsequently the 7th OPEC and non-OPEC Ministerial Meeting, with market sentiment improving in the weeks thereafter.
However, the COVID-19 outbreak has had a major adverse impact on global economic and oil demand forecasts in 2020, particularly for the first and second quarters. Global oil demand growth in 2020 is now forecast to be 0.48 mb/d, down from 1.1 mb/d in December 2019. Moreover, the unprecedented situation, and the ever-shifting market dynamics, means risks are skewed to the downside.
The Conference noted that the further impact of the COVID-19 outbreak on oil market fundamentals necessitates further continuous monitoring.
Accordingly, in view of the current fundamentals and the consensus on market perspectives, the Conference decided to recommend to the 8th OPEC and non-OPEC Ministerial Meeting to extend the adjustment levels agreed at the 177th Meeting of the Conference and the 7th OPEC and non-OPEC Ministerial Meeting for the remainder of the year. It also agreed to recommend to the 8th OPEC and non-OPEC Ministerial Meeting a further adjustment of 1.5 mb/d until 30 June 2020 to be applied pro-rata between OPEC (1.0 mb/d) and non-OPEC producing countries (0.5 mb/d) participating in the Declaration of Cooperation.
The Conference commended all OPEC Member Countries, as well as non-OPEC countries participating in the Declaration of Cooperation, for their continued commitment to achieving and sustaining balance and stability in the market.
Member Countries reaffirmed their continued focus on fundamentals for a stable and balanced oil market, in the interests of producers, consumers, and the global economy. The Conference emphasized the ongoing dialogue with consuming countries, and the consultations undertaken in a collegial spirit before reaching decisions. Member Countries are resolute and committed to being dependable and reliable suppliers of crude and products to global markets.
The Conference confirmed that its next Ordinary Meeting will convene in Vienna, Austria, on 9 June 2020, and noted that September 2020 will mark the 60 Year Anniversary since the founding of OPEC in Baghdad in 1960.
The Conference expressed its continued gratitude to the Government and to the people of Austria, as well as the authorities of the City of Vienna, for their warm hospitality and excellent arrangements for the Meeting.
Opening address to the 178th (Extraordinary) Meeting of the OPEC Conference
Vienna, Austria - 05 Mar 2020
Excellencies, distinguished delegates,
In the name of Algeria and on behalf of the Heads of Delegation and the OPEC Secretariat, it is my pleasure to welcome you all to Vienna for the 178th Meeting of the OPEC Conference.
I would also like to pay tribute to my immediate predecessor as President of the OPEC Conference, HE Manuel Salvador Quevedo Fernandez, People’s Minister of Petroleum of Venezuela. Guiding the Conference in 2019 was an onerous task; however, HE Quevedo did so with tremendous skill, dedication and commitment. I thank you for your leadership and valuable contribution.
Excellencies, Ladies and Gentlemen,
The 18th meeting of the Joint Ministerial Monitoring Committee, this meeting of the OPEC Conference, and the 8th OPEC and non-OPEC Ministerial Meeting are taking place on dates of immense significance in the history of OPEC.
Exactly 45 years ago, between the 4th and 6th of March 1975, my own country, Algeria, hosted the First OPEC Summit, or to give its correct title, the ‘Conference of Sovereigns and Heads of State of OPEC Member Countries.’ It culminated in the adoption of the Organization’s First Solemn Declaration. It constitutes also the origin of the establishment of our sister organisation, known initially as the “The OPEC Special Fund” and later as the OPEC Fund for International Development, which has contributed since then to funding development projects in no less than 134 countries, in energy, transportation, agriculture, water and sanitation, health, and education. I would like to take this opportunity to express, personally and on behalf of the Conference, my thanks and gratitude to Dr Abdulhamid Al-khalifa, Director-General of OFID, and to his able staff, for their great achievements in contributing to reducing poverty and improving the lives of millions of people around the globe.
Complemented and strengthened by the Second Solemn Declaration issued in Caracas, Venezuela, in 2000, and the Third Solemn Declaration issued in Riyadh, in November 2007, the First Solemn Declaration continues to guide this Organization today.
In the Declaration, Member Countries “reaffirmed their support for dialogue, cooperation and concerted action for the solution of the major problems facing the world economy.”
These themes of cooperation, dialogue, soliciting the views of producers and consumers, and reaching out to non-OPEC partners are as relevant today, as they were in 1975.
Perhaps the most tangible manifestation of the seed that was planted in Algiers in 1975 is the current ‘Declaration of Cooperation’ process, the origin of which lies in the Algiers Accord adopted in September 2016. Under the DoC, OPEC works in tandem with our 10 non-OPEC partners in pursuit of sustainable oil market stability, in the interests of producers, consumers and the global economy.
It is only fitting therefore, that today, on this sapphire anniversary of the First OPEC Summit, we reflect on how far this Organization has come in 45 years. Given that the year 2020 marks the 60 year Anniversary of OPEC’s founding, it is more important than ever to benefit from the wisdom of our predecessors.
Turning to the current market situation and our business for today, it is clear that the decisions taken at the 177th Meeting of the OPEC Conference and the 7th OPEC and non-OPEC Ministerial Meeting of 5th and 6th December 2019, to further adjust production voluntarily, saw an improvement in market sentiment over the course of subsequent weeks.
That being said, we now convene at a time when the outbreak of COVID-19 has had a pronounced adverse impact on economic and oil demand forecasts in 2020, particularly in the first and second quarters.
This underscores the fact that events in the oil market are subject to critical uncertainties beyond the capacity of any one individual stakeholder to manage on their own. Complex challenges require collegiality and concerted action. For this reason, the ‘Declaration of Cooperation’ allies have been in close contact with our friends and partners in the People’s Republic of China at this difficult time. We must never lose sight of the fact that outbreak of COVID-19 is, first and foremost, a human tragedy. Our thoughts and prayers go the victims, their families and all bereaved.
We are extremely grateful to the Government of China for their cooperation with us over the last few weeks and months. HE Wang Qun, Permanent Representative of the People's Republic of China to the United Nations and other International Organizations in Vienna, provided a briefing at an extraordinary meeting of the Joint Technical Committee, which was held on the 4th of February. This is a clear indication of the warm relations that exist between China and our participating countries.
Excellencies, Ladies and gentlemen, Forty five years ago, OPEC Member Countries in their first Solemn Declaration stated that, “the interdependence of nations, manifested in the world economic situation, requires a new emphasis on international co-operation and declare themselves prepared to contribute with their efforts to the objectives of world economic development and stability.”
The timeless wisdom of these words has once more been vindicated as we meet to discuss the challenges of our own times. My country is proud of our Membership of OPEC, proud of the role we have played as a constructive partner over many decades and proud that Algeria hosted that first OPEC Summit.
We assume the Presidency of the OPEC Conference at a critical juncture in the Organization’s history, but inspired by the giants of the past and the spirit of the First Solemn Declaration, with all of your help and support, I have no doubt, that this Organization’s best days are ahead of it.
Thank you for your attention.
OPEC press release