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07 Dec 2018

OPEC 175th Meeting concludes

The 175th Meeting of the Conference of the Organization of the Petroleum Exporting Countries (OPEC) was held in Vienna, Austria, on Thursday, 06 December 2018, under the Chairmanship of its President, HE Suhail Mohamed Al Mazrouei, UAE Minister of Energy & Industry and Head of its Delegation.

The Conference congratulated HE Thamir Abbas Ghadhban, the new Minister of Oil of Iraq and thanked his predecessor in office, HE Jabbar Ali Hussein Al-luiebi of Iraq, who had ably and diligently led his country’s delegation to OPEC since August 2016.

The Conference took note of the announcement from Qatar that gives notice of its intention to withdraw from its Membership of OPEC, with effect from 1 January 2019.

The Conference reviewed the Secretary General’s report, the report and recommendations made by the Joint Ministerial Monitoring Committee (JMMC), whose work was supported by the Joint Technical Committee (JTC) and the OPEC Secretariat, the report of the Economic Commission Board, as well as various administrative matters.

The Conference took note of oil market developments since it last met in Vienna on 22 June 2018, and reviewed the oil market outlook for the remainder of 2018 and 2019. In this regard, the Conference observed that current oil supply and demand fundamentals confirm a well accommodated market following the concerted efforts of participating countries in the ‘Declaration of Cooperation’ toward restoring balance.

The Conference discussed the increasing market volatility and the broad consensus on the prospects for 2019 that suggests higher supply growth than global requirements, taking into account prevailing uncertainties.

It also noted that the global economic growth outlook for 2019 is slightly lower than for 2018, which combined with the implications of macroeconomic policies and associated uncertainties, could potentially have ramifications for global oil demand next year.

The Conference also observed the potential consequences of these developments on global inventory levels, as well as overall market and industry sentiment.

In view of the current fundamentals and the consensus view of a growing imbalance in 2019, the Conference decided to adjust OPEC overall production by 0.8 mb/d from October 2018 levels, effective as of January 2019, for an initial period of six months, with a review in April 2019. A reconfigured JMMC was requested to monitor timely and fair implementation of the above mentioned resolution and report back to the President of the Conference on a regular basis.

In agreeing to this decision, Member Countries confirmed their continued focus on fundamentals for a stable and balanced oil market, in the interests of producers, consumers, and health and sustainability of the petroleum industry. Member Countries remain committed to being dependable and reliable suppliers of crude and products to global markets.

The Conference thanked 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.

The Conference also acknowledged the crucial role played by participating non-OPEC countries in the ‘Declaration of Cooperation’. In this regard, it stressed the importance of the 5th OPEC and non-OPEC Ministerial Meeting that will take place later in the day on 07 December 2018.

The Conference, building on the success of market stabilizing efforts of the ‘Declaration of Cooperation’, which has been in the interest of producers, consumers, petroleum industry, as well the global economy, pledged to further strengthen its cooperation with non-OPEC participants within a framework under the draft Charter of Cooperation between Oil Producing Countries, which was endorsed in principle and to be finalized and ratified by the participating countries.

The Conference elected HE Manuel Salvador Quevedo Fernandez, People's Minister of Petroleum of the Bolivarian Republic of Venezuela as President of the Conference for one year, with effect from 01 January 2019, and HE Mustapha Guitouni, Algeria’s Minister of Energy as Alternate President, for the same period.

The Conference paid a glowing tribute to the outgoing President of the Conference, HE Suhail Mohamed Al Mazrouei, for his exemplary leadership in 2018.

The Conference appointed Mr. Agustín Mba Okomo, Equatorial Guinea’s Governor for OPEC, as Chairman of the Board of Governors for the year 2019, and Mr. Etienne Lepoukou, Gabon’s Governor for OPEC, as Alternate Chairman for the same period.

The Conference resolved that its next Ordinary Meeting will convene in Vienna, Austria, in April 2019.

The Conference expressed its continued gratitude to the Government and to the people of the Republic of Austria, as well as the authorities of the City of Vienna, for their warm hospitality and excellent arrangements for the Meeting.