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HE Abdelmadjid Attar
President of the OPEC Conference 2020
Minister of Energy
Algeria

Q: What is your country’s historical connection to OPEC and how has it influenced your country’s development?

A: The accession of Algeria to OPEC in July 1969 confirmed and consolidated the country’s status as a sovereign and free oil producer and exporter. This was followed by the nationalization of its domestic hydrocarbon industry in February 1971. Since it joined OPEC, Algeria has been a strongly committed Member and has continued to play a prominent and pioneering role. It is worth highlighting that the First Summit of Heads of State and Government of OPEC Member Countries was held in Algiers in 1975, and is one of only three such Summits to date. The first Summit was one of the pillars that set the Organization’s policy guidelines, with OPEC Member Countries calling for a new era of cooperation in international relations, in the interests of world economic development and stability. It led to the inception of what a few years later became the OPEC Fund for International Development (OFID).

Algeria also contributed to forging consensual solutions in times of oil market hardship. In 1999, it was at a meeting held in the residence of the Algerian Ambassador in The Hague that the elements of the OPEC and non-OPEC agreement were developed. Furthermore, in a moment of pronounced market volatility and during the turmoil of the acute global financial crisis in 2008, Algeria took the leadership in hosting the momentous Meeting of the OPEC Conference, leading to the historic decision called the ‘Oran Decision’, which adjusted production down by a massive cumulative 4.5 million b/d.

More recently, in September 2016, Algeria hosted the 170th (Extraordinary) Meeting of the OPEC Conference, and played a leading role in achieving the ‘Algiers Accord’, which paved the road to the landmark ‘Declaration of Cooperation’ in December 2016 between 14 OPEC and ten non-OPEC participating countries. Since then, Algeria has continued to provide strong support for ongoing consultations among OPEC and non-OPEC producers.

As per OPEC’s Statute, the principal aim of the Organization shall be the coordination and unification of the petroleum policies of Member Countries and determination of the best means to safeguard their interests, individually and collectively. Algeria, as a Member, and OPEC as an Organization, have mutually benefitted from working together over the five past decades: the Organization has helped in securing a steady income for oil producing countries by stabilizing the global oil market and reducing volatility, while at the same time Algeria has contributed to the success of the Organization at different levels.

Over these five decades, Algeria has seen huge socio-economic development. Regarding the energy sector, the diversification of the energy mix through the application of new technology and innovation, as well as reforms that have sought to encourage investment, are at the heart of our strategy. Today, Algeria has a well-developed and capable oil and gas industry. Electricity coverage reaches almost 100 per cent, and more than 60 per cent of households are connected to the natural gas grid.

Q: What do you consider to be OPEC’s most significant milestones?

A: Maintaining oil market stability is a prominent principle of OPEC’s Statute. If OPEC only focused on the oil price, it would only manage its production capacity to meet the demand for OPEC crude. However, OPEC Member Countries maintain additional capacity at their own cost, so as to be able to respond to international demand surges. As a result, maintaining spare capacity has led to a significant reduction in oil market volatility. The simple answer to the central question of what the energy market would look like without OPEC would be: a market with huge volatility.

Over the past 60 years of OPEC’s history, the Organization has overcome with great success all oil crises, and its cohesion and unity has been reflected in consensus among Member Countries. OPEC was able to mitigate market turbulence during all the most difficult shocks, including the first and second shocks in 1973 and 1979, the crises in 1986 and the late 1990s and most recently in 2008 and 2016.

The growth of the oil market since 2000 has led to the necessity for more widespread cooperation to maintain its stability. In the past decade, the oil industry has seen a structural change in the relationship between OPEC and certain non-OPEC producing countries, which has softened and transformed from competitive to cooperative.

Q: What impact has the ‘Declaration of Cooperation’ and ‘Charter of Cooperation’ process had on OPEC as an international organization?

A: Although cooperation between OPEC and non-OPEC countries was in place in the late 1990s and early 2000s for instance, it was first institutionalized in 2016 with the establishment of the ‘Declaration of Cooperation’ (DoC) and with the ‘Charter of Cooperation’ (CoC) in 2019. These milestone cooperative efforts are a clear indication that OPEC has taken a central role in the oil industry, most likely more than at any other time in its history, and has increasingly become essential for oil market stability.

The main benefit of the DoC has been wider international cooperation and equitable adjustment-sharing in times of an oversupplied market. The measures taken through the DoC have been effective and led to oil stocks declining, thus supporting sustainable investment in the sector. OPEC has in a way become more international through intensified cooperation with non-OPEC partners.

Furthermore, in the midst of the current COVID-19 pandemic situation, with full-blown crises in both economy and energy, OPEC has proven once again its central relevance and importance to the overall energy market. Within the framework of the DoC, OPEC and non-OPEC producing countries have taken the necessary steps to adjust oil production for the upcoming two years in order to avoid the further deterioration of market conditions. The efforts between OPEC and partnering non-OPEC countries to react in an orderly manner have resulted in additional cooperation with other G20 producing countries. This is beneficial for consumers and producers alike, as it helps to restore stability, a necessary prerequisite for the normal functioning of the global energy market.

Q: What is the significance of OPEC going forward?

A: Looking forward, many reputable outlooks show that oil will remain an important component of the energy mix in the long term. At the same time, as non-OPEC supply is expected to begin to decline towards the end of the current decade, the importance of OPEC supply will increase accordingly. As spelled out in the Statute, OPEC’s principle is to ensure an efficient, economic and regular supply of petroleum to consuming nations.

Despite the current health and economic crisis leading to a significant drop in energy and oil demand in 2020, the recovery in the coming years will require further oil market stability, which can only be provided by the engagement of oil producers and consumers, fully knowing the importance of supply, as well as demand security.

Finally, OPEC’s role in the ongoing energy transition should also be recognized. This change does not mean moving from one energy source to another; rather all energy sources will be needed to meet rising demand, and each energy source has an important role to play in the overall energy mix. In this regard, oil will continue to be an important source to ensure energy access, particularly for people suffering from acute energy poverty.

While the DoC has been short-term oriented, OPEC established the CoC in 2019, which is a “high-level commitment to facilitate dialogue among participating countries, aimed at promoting oil market stability, as well as cooperation in technology and other areas, for the benefit of oil producers, consumers, investors and the global economy. It is a means of enabling the long-term use of oil as a key component in the evolving global energy mix, as well as improving the environmental and efficiency credentials of oil”. The CoC addresses the long-term issues of oil as an energy source and could serve as a platform to further tighten connections between OPEC and non-OPEC oil producing countries.

The role of oil remains important. However, more efforts from all stakeholders are required to continue to unify strategies and enhance technology to further promote cleaner and carbon-free oil.

Therefore, cooperation between OPEC and non-OPEC producing countries, within the framework of the DoC, the CoC and beyond, will remain the sine qua non in the long term.

HE Gabriel Mbaga Obiang Lima
Minister of Mines and Hydrocarbons
Equatorial Guinea

Q: What is your country’s historical connection to OPEC and how has it influenced your country’s development?

A: Equatorial Guinea joined OPEC on May 25, 2017, becoming its 14th Member Country and sixth African Member. In the lead-up to assuming membership, Equatorial Guinea was involved in the extensive consultations that led to the landmark decision on the ‘Declaration of Cooperation’ (DoC) taken at the OPEC-non-OPEC Ministerial Meeting on December 10, 2016.

Since then, Equatorial Guinea has been an active participant in OPEC’s key decisions on the global stage in promoting stability in the oil market, as well as having input on decisions that could affect our country’s industry.

These joint OPEC/non-OPEC contributions have been effective in supporting stability in the oil market and providing a boost, not only to the global economy, but to the economy of Equatorial Guinea. This is extremely crucial to our country, especially when you consider that 75 per cent of the revenue of the country comes from the oil sector.

For us, OPEC is an institution that allows us to be current on global oil-related issues, in addition to being a forum for exchange of experiences with other producing countries. It also offers opportunities for training and information exchange for our technicians.

Q: What do you consider to be OPEC’s most significant milestones?

A: Equatorial Guinea considers as the most important milestone of OPEC the foundational vision upon which it was created. This is based on its fundamental objectives as an international and intergovernmental organization, established with the purpose of political and unified coordination of its Member Countries to promote the stabilization of the oil market. This, in turn, helps to ensure an efficient and economic supply of oil that helps support the further development and growth of all countries, especially the Member Countries.

Q: What impacts have the ‘Declaration of Cooperation’ and ‘Charter of Cooperation’ had on OPEC as an international organization?

A: Equatorial Guinea collaborated in the key OPEC+ decisions in 2016 that led to the voluntary adjustment of world oil production by 1.2 million b/d and has been committed to cooperating with the non-OPEC producing countries of the DoC. This and subsequent decisions have made a positive impact in the short term and have continued to promote stability in the global oil market during the implementation phase since that milestone decision was made at the Ministerial Meeting on December 10, 2016.

OPEC’s continuous commitment to stable markets in the interest of oil producing nations has helped ensure the efficient, economical and steady provision of energy to its Member Countries and their global customers.

OPEC’s efforts with its external partners, among them the Russian Federation, contribute to the stability of the global oil market, which, in turn, also benefits consumers and the economy.

Q: What is the significance of OPEC going forward?

A: Equatorial Guinea believes OPEC will continue to be crucial to ensuring the stabilization of the global market in the oil sector and the growth of all countries.

Q: Please provide us with some colourful insights on your experience with OPEC.

A: Since joining OPEC, Equatorial Guinea has enjoyed very positive experiences and has had the privilege of exchanging information and ideas with a diverse range of fellow Member Countries that have years of valuable experience in the industry. These collaborative efforts have included promoting stability in the oil sector at the global level while also providing Equatorial Guinea’s input and viewpoints in relation to the decisions that are made that affect our sector.

HE Eng. Bijan Namdar Zanganeh
Minister of Petroleum
IR Iran

Q: What is your country’s historical connection to OPEC and how has it influenced your country’s development?

A: Nationalization of the oil industry in IR Iran by Dr. Mossadeq's administration is an important milestone in the history of our country’s oil industry. Although this important historical development was influenced by the 1953 coup, the idea of countering the dominance of oil companies and efforts made to achieve the independence of the oil industry were the basis for cooperation among five major oil producing countries to counter the dominance of the seven sisters (international oil companies). This finally led to the founding of OPEC. Due to the establishment of OPEC in 1960 and IR Iran’s presence as one of the Founder Members of the Organization, the nationalization trend in IR Iran's oil industry was revived and OPEC Member Countries (MCs) were inspired by IR Iran's oil industry movement. This further influenced the reflection of and approach to nationalization of their countries’ oil industries.

Q: What do you consider to be OPEC’s most significant milestones?

A: The formation and establishment of OPEC, aimed at securing Member Countries’ interests and their oil industry is the most important milestone in the history of the Organization. According to Article 2 of the OPEC Statute, the principal aim of the Organization shall be the coordination and unification of the petroleum policies of Member Countries and the determination of the best means for safeguarding their interests, individually and collectively. In general, the philosophy behind the establishment of the OPEC is support to its members and maintaining market stability. The most important OPEC milestone is thus the common understanding achieved by Member Countries of oil market developments and the necessity of taking required measures to materialize the objectives stipulated in the OPEC Statute. The importance of this common understanding is such that OPEC Member Countries, despite intense political discrepancies among themselves at some points in time, have always gathered together to achieve the common goal of market stability and maximizing their interests, and finally have reached consensus on every single issue.

Q: What impact has the Declaration of Cooperation and Charter of Cooperation process had on OPEC as an international organization?

A: The Declaration of Cooperation (DoC) was an outcome of the joint OPEC and non-OPEC producing countries’ Ministerial Meeting held on 10 December 2016, and it is based on the fundamental principles of cooperation, stability and sustainability. It has established exemplary relations between OPEC and non-OPEC oil-producing countries to support and maintain sustainable stability in the global oil market. OPEC is the main driver of this cooperation among 23 oil producing countries to materialize their common goals. OPEC MCs, while stressing the necessity of preserving the unity and independence of the Organization, have provided the necessary basis for expanding cooperation with non-OPEC producers within the framework of the DoC. Despite collective efforts made to establish stability in the global oil market, OPEC has faced attacks and accusations by some major consumers at various historical junctures. For example, OPEC has surprisingly been accused of being a cartel whenever a price hike has occurred, and when prices dropped, OPEC has been accused of dumping oil to affect prices. In this regard, the principles of international law do not provide any support and/or protection to OPEC or its Members, and most OPEC MCs have no means other than oil to secure their national wealth and their countries’ development.

Q: What is the significance of OPEC's going forward?

A: The most important significance of OPEC in the future will be to emphasize the necessity of cooperation, rather than rivalry, among oil producers. Oil producers are partners and rivals at the same time. The intention to maximize our oil revenues is the main context of our partnership. Glancing at OPEC’s brilliant 60-year history, one may notice that whenever relations within the Organization have shifted from partnership and cooperation towards competition, we have all suffered losses. Hence, it is essential that on our future path, with a thorough understanding of past experiences, we choose cooperation and partnership with each other and pursue the collective interests of Member Countries. In this regard, making efforts to resolve security and political issues among Member Countries is of great importance. The occurrence of two wars in the Persian Gulf and the presence of foreign troops in the region have directly affected developments in the oil market and turned oil into a tool to be used by producers to compete and exert pressure on each other. Any attempt to resolve the current security issues in the region will help stabilize the oil market and be beneficial to everyone.

Please provide us with some colorful insights on your experiences with OPEC.

A: An important challenge in the recent history of OPEC has been the rising strength of financial markets in setting oil prices and controlling the oil market through speculative activities. Additionally, using oil as a political tool to pressure and sanction oil-producing countries must be theoretically and practically opposed and denounced by all OPEC Member Countries.

HE Dr Khaled Ali Al-Fadhel
Minister of Oil
Minister of Electricity and Water
Chairman of the Board – Kuwait Petroleum Corporation (KPC)
State of Kuwait

Q: What is your country’s historical connection to OPEC and how has it influenced your country’s development?

A: Kuwait is amongst the five founding countries that established the permanent, intergovernmental Organization of the Petroleum Exporting Countries at the Baghdad Conference during September 10–14, 1961. Since then, Kuwait has been an active Member of the Organization aiding in coordination and unification of the petroleum policies of Member Countries and the determination of the best means for safeguarding their interests, individually and collectively. Such policies have great influence for the development of any oil industry in any country and specifically Kuwait’s industry. Moreover, Kuwait was heavily involved in the development the general framework and guidelines for establishing the Joint Ministerial Monitoring Committee (JMMC) and the Joint Technical Committee (KTC). Both were chaired by Kuwait upon establishment. Kuwait still maintains a leading role in both committees.

Q: What do you consider to be OPEC’s most significant milestones?

A: OPEC’s history is rich in many significant milestones, from the very first resolution of the Organization to the current historical ‘Declaration of Cooperation’ signed by OPEC and non-OPEC countries. All OPEC’s milestones have a shared significance in that they possess the same spirit, the spirit that this Organization was founded on. This spirt was translated in the OPEC statute, which states: Coordination and unification amongst Member Countries to determine best means for safeguarding their interests, both individually and collectively. Also, devising ways to ensure stabilization of oil markets and eliminating harmful and unnecessary fluctuations in price. Moreover, due regards are to be given at all times to establish and maintain a balanced market which reflects a non-zero sum theory (win-win situation) between producers and consumers.

Q: What impact has the ‘Declaration of Cooperation’ and ‘Charter of Cooperation’ process had on OPEC as an international organization?

A: Members of the OPEC+ are fully cognizant of the fact that with something as complex as the international oil market, with all its fluid components and inherent pressures, many of an external nature, one simply cannot afford to take chances. Cautious approach has proven to be the best way to move forward in a smooth and orderly fashion. Right now, this responsible approach demonstrated by the historical DoC that is dedicated to establishing and maintaining lasting oil market stability is proving fruitful. The facts speak for themselves: oil demand is relatively firm, supplies to the consumers are sufficient, petroleum stocks are comfortable and crude prices are reasonable and relatively stable despite the adverse impact of the corona virus.

Q: What is the significance of OPEC going forward?

A: During this vital period in the oil industry that is filled with many challenges; OPEC has and should remain well equipped in overcoming these challenges and barriers. From my point of view, OPEC in this essence could act as the ‘World Central Bank for Oil Policies’, taking full risks as a swinging oil producer, while continuing to cover any current or future shortages by managing supply worldwide, to balance the oil market in the interest of the oil industry at large.

Q: Please provide us with some colourful insights on your experience with OPEC.

A: Through my experience of attending several conference meetings recently, I am extremely impressed by the high-level coordination amongst OPEC Member Countries. In addition, I register my deep admiration to the great consolidation between OPEC Member Countries and oil consuming nations. This is demonstrated in the work of Joint Organization Data Initiative (JODI). Also, we are very delighted about the cooperation between OPEC and the non-OPEC countries participating in the so-called OPEC+ deal. This coordination certainly exhibits responsibility by most nations to unify the common policy that reduces oil market uncertainty. This stabilization benefits global and Member Countries collectively. Moreover, I highly appreciate the high quality, exceptional and unfailing technical analysis the Secretariat performs and delivers in its periodical reports. It is of no doubt in my mind, the several periodicals are now an oil industry flagship reports such as the Monthly Oil Market Report (MOMR), the World Oil Outlook (WOO) and OPEC’s Annual Statistical Bulletin (ASB). These reports along with OPEC’s research team have been of great support to our JTC and JMMC, these two organs within the Organization are closely watched and monitored by industry pundits.

HE Thamir Abbas Al-Ghadhban
Former Deputy Prime Minister for Energy Affairs
Former Minister of Oil
Iraq

Q: What is your country’s historical connection to OPEC and how has it influenced your country’s development?

A: To start with, OPEC’s history and Iraq’s vital position in the foundation of the Organization. One should highlight that OPEC was founded due to an initiative of five Founding Members (Iran, Iraq, Kuwait, Saudi Arabia and Venezuela) when the representatives of these countries gathered in the Baghdad, the birthplace of the Organization, in September 1960, and announced the establishment of the OPEC. They kept the door open for other oil producing countries to join. We are planning to commemorate OPEC’s 60th Anniversary here in Baghdad in the near future.

The main objective of the Organization is to ensure the supply and demand balance in the oil market for the benefit of oil producers, consumers and investors. Iraq’s economy is mainly dependent on oil revenues, and as a stakeholder in OPEC, Iraq – like other members – is benefiting from the outstanding achievements of the Organization.

Q: What do you consider to be OPEC’s most significant milestones?

A: When it comes to the most significant milestones of OPEC, one should point to the historic ‘Declaration of Cooperation' undertaken by the Organization in late 2016 and which entered into force on January 1, 2017, and the subsequent production adjustment agreements. Believing in the power of collective work, OPEC amid numerous challenges and volatile market conditions took the lead and succeeded tremendously in involving non-OPEC producers.

Q: What impacts have the Declaration of Cooperation and Charter of Cooperation had on OPEC as an international organization?

A: The past months demonstrated the significant results of OPEC+ and how much worse the market conditions would have been if the production adjustment agreement had not been reached. OPEC, together with OPEC Member Countries and non-OPEC producers, led by Russia, expanded their exceptional efforts in concluding the Charter of Cooperation on July 2, 2019. Serious and continuous monitoring of the energy market and taking the suitable decisions accordingly has played a noticeable role in avoiding the negative impact of the 2014 crisis being repeated.

Q: What is the significance of OPEC going forward?

A: I believe that OPEC performs two key roles, namely (a) collective work and (b) achieving sustainable stability. OPEC’s goals are derived from and driven by the energy needs of consumers and producers. OPEC is committed to ensuring stability in the oil markets to meet these needs at fair prices.

Q: Please provide us with some colourful insights on your experience with OPEC.

A: In addition to the position of Deputy Prime Minister for Energy Affairs, I assumed the position of Iraq’s Minister of Oil and Head of Delegation at a critical period of time, when the oil market was oversupplied due to several factors – inter alia, economic growth, prosperity and geopolitics – which in aggregate called for more output adjustment. I have worked closely with other esteemed Heads of Delegations from OPEC’s Member Countries and non-OPEC oil-producing allies during the OPEC Ministerial Meetings and the Joint Ministerial Monitoring Committee Meetings. These events have provided excellent opportunities to exchange views and share ideas and have demonstrated the importance of the multilateral dialogues and collective work in monitoring the energy market and its condition.

Furthermore, analysis of the influential factors and decision-making were made possible by the efficient support provided by the Secretary General of the Organization and the knowledgeable staff and departments that have accumulated vast knowledge and experience throughout the years. I would like to acknowledge the beautiful and colourful cultural activities exhibited by various Member Countries alongside OPEC’s conferences, whether held in Vienna or in other venues.

Finally, as we prepare to celebrate the 60th anniversary, I wish our Organization continuous and everlasting success.

Mr Abdullah Ismail
Former Deputy Minister of Oil
Iraq

Q: Going back six decades, what factors led to the creation of OPEC?

A: The establishment of the Organization of the Petroleum Exporting Countries (OPEC) came about as a response to the price manipulation carried out by oil firms, which disregarded the interests of oil-producing countries and their people, the rightful owners of the resources.

These companies continued to reduce the oil prices, particularly in February 1959 and August 1960. This led to the understanding of oil-producing countries of the importance of unifying their position. In this context, the Iraqi government took the initiative to invite Iran, Kuwait, the Kingdom of Saudi Arabia and Venezuela to hold a meeting in Baghdad on September 10, 1960, to discuss the situation and work jointly on coordinating the oil policies of the participating countries in a way that achieves the interests of their people.

Q: As a key participant of the historic ‘Baghdad Conference’, what were the main decisions taken at the meeting?

A: The meeting resulted in the creation of the Organization by its five Founder Members. It was also decided to host the second meeting in Caracas, Venezuela. Qatar attended the first meeting in Baghdad as observer.

By the end of the second meeting, which was held in Venezuela between January 15 and 21, 1961, it was announced that Geneva would host the Organization’s Headquarters. The meeting appointed Iran’s representative, Dr Fuad Rouhani, as the first OPEC Secretary General. The OPEC Statute was also approved then, which contained the internal regulations, membership conditions and categories and the decision-making mechanism.

According to the Statute, OPEC has three membership categories: Founder Member, which is limited to the five Founder Members that attended the Baghdad Conference; Full Member, which is for countries that fulfil the Membership criteria and their requests are approved by the OPEC Conference; and Associate Member, which is for countries that do not entirely fulfil the conditions to become Full Members but that may be admitted if the OPEC Conference approves their request.

Q: How did the relocation of the OPEC Secretariat to Vienna come about?

A: In the Second Meeting of the OPEC Conference, it was decided to locate OPEC’s Headquarters in Geneva, Switzerland, where it continued to operate until 1965 when it was moved to the Austrian capital of Vienna.

The Organization mandated the late Dr Abdul Rahman Al-Bazzaz, then-OPEC Secretary General, to explore other possibilities for hosting the Organization’s Secretariat. London, Rome and Vienna were among these options. Vienna was then selected as the new home for the Organization.

Q: OPEC is an established and respected member of the international energy community. What is the purpose of the Organization?

A: The Organization’s objectives were detailed in the special founding decision of the Organization, which are: to coordinate and unify the petroleum policies of Member Countries and designate the best means to protect their individual and collective interests; identify the best methods that help securing stable prices in the global oil market and eliminate fluctuations; and respect the interests and rights of oil-producing countries to stable and fair income, while ensuring regular oil supply to consuming nations and securing a fair return on capital to those investing in the industries. The Organization was able to coordinate the oil supply policies of its Member Countries to balance demand and supply to protect prices in the global oil market and avoid its collapse.

Q: As a witness to the such an historic event, how important was OPEC’s founding?

A: Although I mentioned earlier the reasons for founding OPEC, I do recall that there were a few others. These in fact led to several attempts to coordinate the oil policies of producing countries, including the efforts to coordinate the oil policies of Iran and Venezuela in 1947; the Saudi-Iraqi agreement of 1953 that allowed the two countries to coordinate petroleum policies and exchange information; and the decision of the Arab Economic Council, which is part of the Arab League, of April 1959 to hold the first Arab Petroleum Congress that was attended by many Arab and non-Arab oil-producing countries.

It is unreasonable to discuss the oil industry in Iraq or the Middle East without touching upon the Organization of the Petroleum Exporting Countries, the Organization that has played a key role in safeguarding the interests of oil-producing countries and embracing many legitimate rights that were impossible or difficult to acquire before OPEC.