By Eyo Nsima
The Organisation of Petroleum Exporting Countries, OPEC, has tasked members and observers of G24 on oil market stability.
In his verbal statement at the G-24 Ministerial Meeting, the Secretary General, OPEC, HE Mohammad barkindo, stated: “The global economy and, consequently, the global oil market have made considerable progress recovering from the impacts of the COVID-19 pandemic. Following the strong decline in 2020, the OPEC Secretariat forecasts global economic growth of 5.6% in 2021 and 4.2% in 2020.
“However, the extent and speed of economic recovery varies widely across the world’s regions. Emerging and developing economies that have less access to vaccinations and only limited financial resources for fiscal and monetary stimulus have so far been left behind. A stable market environment is of vital interest, particularly for those economies among the G24 that are commodity exporters.
“Supported by the strong rebound in economic activity in combination with the easing of lockdown measures and the lessening of travel restrictions, world oil demand is expected to recover significantly in both 2021 and 2022.
“Oil demand is forecast to grow by 5.8 mb/d in 2021 and is forecast to expand further by 4.2 mb/d in 2022. Non-OPEC supply suffered from the unprecedented COVID-19 repercussions, but now is estimated to grow by 0.7 mb/d in 2021, and to further expand by 3.0 mb/d in 2022. In responding to the global oil-market environment, OPEC Member Countries and 10 non-OPEC countries participating in the ‘Declaration of Cooperation’ (DoC) reaffirmed in July 2021 the Framework of the Declaration of Cooperation which was signed in December 2016.
“Furthermore, it was decided to extend the decision of the 10th OPEC and non-OPEC Ministerial Meeting in April 2020 until the 31st of December 2022. Hence, OPEC and the 10 non-OPEC participating countries of the DoC will adjust upward their overall production by about 0.4 mb/d on a monthly basis starting August 2021 until phasing out the 5.8 mb/d production adjustment.
“These joint efforts have so far been very successful in balancing the oil-market, after commercial oil inventories reached unprecedentedly high levels, threatening the sustainability of oil-investments, and hence long-term supply. Undoubtedly, these actions were very vital to support the global economic recovery and the well-being of the world economies, oil-consumers and oil-producers alike.”
It added: “In closing, OPEC would like to take this opportunity to reaffirm its longstanding commitment to supporting oil market stability for the mutual benefit of consuming and producing nations, contributing significantly to addressing the common challenges to the global economy.”
