OPEC’s View for the Future as it Marks Fifty Years, Focus Reports
Release Date: 2010-10-14
The 12 members of the Organization of the Petroleum Exporting Countries (OPEC) met in Vienna on Wednesday, 13 October to discuss global petroleum demand and establishing production quotas for the year to come. Celebrating its 50th birthday, OPEC today controls over 75% of the world’s oil reserves and is recognized as the primary institution that determines oil prices and supply worldwide.As an indication of confidence in the rebounding global economy and satisfaction with current oil prices, OPEC announced that they would leave production levels unchanged for the coming year. This comes amidst numerous reports of overproduction by most of the oil exporting countries who have been taking advantage of the recent rise of oil prices in the past months. The price of oil on Thursday was quoted at USD$83 which represented the highest price yet in the past five months.
The aim of maintaining production levels is to stabilize the market, particularly so that energy-dependant nations still emerging from the recession can enjoy a full recovery. Some analysts worry that current production levels are not realistic in meeting actual global demand, which is rapidly increasing due to energy-hungry giants such as India and China.
According to OPEC, estimated oil demand this year will only see a total increase of 1.3 percent and 1.2 percent for 2011. Some fear these numbers do no represent the reality. Amongst those who disagree is Venezuelan Energy and Oil Minister, Rafael Ramirez, who has called for an increase in oil prices to USD$100 in order to offset current overproduction that is occurring. With the rapid devaluation of the dollar, which is used to determine the price of oil, OPEC countries have been exceeding production quotas to make up for lost revenue.
Aside from their predictions, the organization also announced that Iran would hold the presidency in 2011. Iran and Iraq have been known for their tempestuous relationship filled with rivalry and disagreements, and there are concerns that these tensions could spark once again in the near future. Now that Iraq’s oil production is rapidly increasing, they have aspirations to become the world’s top oil supplier, overtaking even Saudi Arabia. Such an event could certainly destabilize the internal dynamics of the organization.
| Type: | NORMAL |
| Company: | Focus Reports |
| Country: | 瑞士 |