The 138th (Extraordinary) Meeting of the Conference of the Organization of the Petroleum Exporting Countries (OPEC) convened in Kuwait City, State of Kuwait, on 12 December 2005, under the Chairmanship of its President, HE Sheikh Ahmad Fahad Al-Ahmad Al-Sabah, Minister of Energy of the State of Kuwait and Head of its Delegation, and its Alternate President, HE Dr Edmund Maduabebe Daukoru, Minister of State for Petroleum of Nigeria and Head of its Delegation.

The Conference extended a warm welcome to HE Seyed Kazem Vaziri Hamaneh, Minister of Petroleum of the Islamic Republic of Iran, and congratulated him on his recent appointment.

The Conference extended its sincere condolences to the Governments and people of the Islamic Republic of Iran and the Federal Republic of Nigeria at the tragic loss of life caused by recent aeroplane accidents.

The Conference welcomed the presence of the Minister of Energy and Mining of Sudan, the Minister of Petroleum and Mineral Resources of Syria, the Undersecretary of Petroleum of Egypt, and the Undersecretary of Oil and Gas of Oman, whose presence in the Meeting again highlights the importance these countries attach to constructive dialogue and co-operation with OPEC and its Member Countries.

The Conference considered the report of the Ministerial Monitoring Sub-Committee, whose Members the Conference again thanked for their untiring efforts on behalf of the Organization, as well as other presentations.

Having reviewed the oil market situation, the Conference observed that the market has been well supplied and commercial stocks, especially of crude oil, have been building, in terms of absolute levels and forward days' cover. This is due to OPEC's prompt responses and willingness to provide the market, if and when needed, with the required supplies.

The Conference further considered the outlook for 2006 and noted that the ceiling adopted by OPEC in its 136th (Extraordinary) Meeting in June 2005 of 28.0 mb/d (excluding Iraq) will be adequate, if fully observed, to balance the market for the first quarter of the year. However, in view of the supply/demand outlook for the second and third quarters 2006, when demand is seasonally lower, thus requiring reduced supplies from OPEC to balance the market, the Conference decided to convene an Extraordinary Meeting in Vienna, Austria, on 31 January 2006, in order to review the situation and take the appropriate decisions on production levels for the second and third quarters of the year. The Conference also reconfirmed that its next Ordinary Meeting will convene in Vienna, Austria, on 8 March 2006.

In taking the foregoing decision, the Conference reaffirmed the Organization's determination to take all measures deemed necessary to keep market stability and maintain prices at reasonable levels through the provision of adequate supplies, as it has demonstrated repeatedly in the past, including the recent offer to make its additional capacity of 2.0 mb/d available for three months, an offer that expires on 31 December 2005 and which, the Conference noted, had not been taken up by the market because it is so well-supplied.

The Conference reiterated its call on consumers and the industry to join efforts to alleviate the refinery bottlenecks which are the main engine driving prices in a market which is well-supplied with crude oil and, in this regard, welcomed the recommendation made by the recent 2nd Ministerial Meeting of the EU/OPEC Energy Dialogue to undertake joint studies on refining and futures markets.

In this regard, the Conference also agreed that, with a view to reassuring the market about future availability of production capacity, the Organization will, henceforth, publish information relating to Member Countries' capacity expansion plans, investment in downstream projects, as well as other relevant information.

The issue of the appointment of the Secretary General having been deferred until the next Ordinary Meeting of the Conference, the incoming President of the Conference, HE Dr Edmund Maduabebe Daukoru, Minister of State for Petroleum of Nigeria, will assume the responsibilities of the Secretary General from 1 January 2006, in accordance with the provisions of Resolution No. 128.406.

The Conference paid tribute to the services of its outgoing President, HE Sheikh Ahmad Fahad Al-Ahmad Al-Sabah, Minister of Energy of the State of Kuwait and Head of its Delegation, expressing particular appreciation of his also shouldering the responsibilities of Secretary General of the Organization during the year 2005, and thanked Dr Adnan Shihab-Eldin, the OPEC Secretariat’s Director, Research Division, for his excellent conduct of the day-to-day affairs of the Secretariat, as Acting for the Secretary General, during the same period.

The Conference approved the Budget of the Organization for the year 2006.

The Conference expressed its sincere gratitude to His Highness Sheikh Jaber Al-Ahmed Al-Jaber Al-Sabah, Emir of the State of Kuwait, and His Highness Sheikh Saad Al-Abdallah Al-Sabah, Crown Prince of Kuwait, as well as the Government and people of the State of Kuwait, for having hosted the Meeting and for the friendly welcome extended to the Conference and all Delegates. The Conference also recorded its appreciation to His Highness Sheikh Sabah Al-Ahmed Al-Jaber Al-Sabah, Prime Minister of Kuwait, for his generous patronage of the Meeting. Finally, the Conference voiced its special thanks to HE Sheikh Ahmad Fahad Al-Ahmad Al-Sabah, Minister of Energy of the State of Kuwait, and his Staff for their warm hospitality and the excellent arrangements made for the Meeting.

The Conference passed Resolutions that will be published on 12 January 2006, after ratification by Member Countries.

Source: OPEC.org