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OPEC at 60: Time to Reflect and Appreciate ― Barkindo

–By Fred Ojiegbe

As the Organisation of Petroleum Exporting Countries, OPEC celebrates its 60 years of existence, the Secretary-General, Mohammed Barkindo has stated that the diamond jubilee celebration is a time to reflect and appreciate the efforts of all those who have worked so hard throughout the organisation’s history to make it the resounding success it has become.

These he said include generations of Heads of State and Government, Ministers, Governors and other high-level experts from outside the Secretariat and, from within the Secretariat, Secretary Generals, Management and Staff of every relevant discipline. “They have all enriched the Organization, through commitment, perseverance and sacrifice, to cope with the many ups and downs experienced by OPEC and its Member Countries. “It is also an opportunity to, once again, extend the Organization’s gratitude to Austria and the City of Vienna, which have been warm and generous hosts to the Secretariat since OPEC moved to this grand, historic city 55 years ago. “I often think back to that day in 1960, the mood in Baghdad, how those visionaries envisaged the future of OPEC and the oil industry. What is clear is that what was set in motion has stood the test of time; OPEC still has the same core objectives, of order and stability in global oil markets, but its role has also broadened considerably, in terms of deeper cooperation with other producers, dialogue with a host of industry stakeholders, and an embrace of human concerns such as sustainable development, the environment and energy poverty eradication,” he said. Barkindo explained that looking ahead, the Organization stands ready to meet the many challenges it shall face as it enters the next 60 years of its history.

“We remain focused on a balanced and stable oil market, in the interests of both producers and consumers, as most recently exhibited through the Declaration of Cooperation and the historic production adjustments of 2020; further elevating dialogue and cooperation through the Charter of Cooperation; and providing options and solutions to some of the major challenges facing humankind, such as sustainable development and energy poverty alleviation. He noted that few would have foreseen six decades ago that the Organization would have risen to the heights it has today in the global energy arena.

“Back then in Baghdad, the five Founding Fathers of OPEC, Juan Pablo Pérez Alfonzo of Venezuela; Abdullah al-Tariki of Saudi Arabia; Dr Tala’at al-Shaibani of Iraq; Dr Fuad Rouhani of Iran; and Ahmed Sayed Omar of Kuwait gathered together in the Al-Shaab Hall in Baghdad, to midwife OPEC into the world,” he said. Valuechain gathered that in the context of that time, when the oil industry was dominated by the major oil companies, which was reflected in its structure and behaviour, it was a heroic and pioneering act by the Founder members to come together in the Iraqi capital.

The seminal ‘Baghdad Conference’, saw these five visionaries from the Founder member countries gather together around the premise of cooperation and with the need to write their own story. Pérez Alfonzo said after the meeting: “We are now united. We are making history.” It would prove to be a profound statement. In the 1960s, OPEC established itself with courage, persistence and diligence, through the development of its Statute that remains in place today, registering at the United Nations (UN) Secretariat on 6 November 1962, under UN Resolution No 6363, initiating a number of landmark decisions, such as the ‘Declaratory Statement of Petroleum Policy in member countries’ in 1968 and expanding its membership.

Sixty years on, the Organization that is today 13 member countries is now an integral part of the international energy community and the multilateral system. It is widely consulted on oil industry affairs, remains firmly committed to secure and steady supplies and fair returns to investors, Member countries run their own domestic oil sectors across the entire value chain, and the organization has expanded its activities to champion issues affecting mankind as a whole.
JMMC focuses full conformity and market stability.

Joint Ministerial Monitoring Committee (JMMC) Meeting
The 22nd Meeting of the Joint Ministerial Monitoring Committee (JMMC) has taken place via video conference under the Chairmanship of Prince Abdul Aziz Bin Salman, Saudi Arabia’s Minister of Energy, and Co-Chair HE Alexander Novak, Minister of Energy of the Russian Federation.

The Committee reviewed the monthly report prepared by its Joint Technical Committee (JTC) and developments in the global oil market since its last meeting on 19 August 2020. The Committee also considered market prospects for the fourth quarter of 2020 and into 2021. The Committee reviewed the crude oil production data for August 2020 and welcomed the positive performance in overall conformity for participating OPEC and non-OPEC countries of the Declaration of Cooperation, DoC, which was recorded at 102 percent in August 2020, including Mexico as per the secondary sources. The JMMC reiterated the critical importance of adhering to full conformity and compensating overproduced volumes as soon as possible.

The JMMC supported, and recommended, to the OPEC and Non-OPEC Ministerial Meeting, the request of several underperforming participating countries in the DoC to extend the compensation period till end of December 2020, after pledging that they will fully compensate for their overproduction. This is vital for the ongoing rebalancing efforts and helping deliver long-term oil market stability. The JMMC observed that the recovery has not been even across the world and an increase in COVID-19 cases has appeared in some countries. In the current environment, the JMMC emphasised the importance of being pro-active and pre-emptive and recommended that participating countries should be willing to take further necessary measures when needed. The Committee thanked the JTC and the OPEC Secretariat for their contributions to the meeting. The next meetings of the JTC and the JMMC are scheduled for 15 and 19 October 2020, respectively.