BAKU, Azerbaijan, Feb.7
By Leman Zeynalova – Trend:
In a number of ways, the pandemic has changed the nature of the way OPEC monitors, analyzes and takes decisions, Mohammad Sanusi Barkindo, Secretary General of OPEC, said in an exclusive interview with Trend.
“The often unpredictable aspects of COVID-19, not only its spread, but also the sporadic impact of lockdowns and restrictions, locally, regionally and globally, have underscored the increasing need to be attentive and proactive, which has been exhibited through our monthly meetings. In general, however, the overall oil market dynamics have changed little and the focus of OPEC and the DoC has remained on the need for market balance and stability, albeit in the face of a devastating pandemic,” he said.
Barkindo noted that additionally, the implications of the pandemic has also reinforced the importance of cooperation, and the magnitude of the investment challenges.
“The value of cooperation was clear during the early stages of the pandemic, when both producers and consumers at the very highest levels, including through the G20, came together to support the actions of the DoC. Looking back on this time, we showed that we could stare down the horrific situation we faced through the enduring timelessness of the principles and key tenets of international cooperation. From the perspective of investment, this great challenge for our industry was exacerbated by the pandemic. In the oil sector alone, upstream oil capital expenditure fell by more than 30 percent in 2020, a shrill wake-up call, exceeding the annual dramatic declines witnessed in the severe industry downturn in 2015 and 2016,” said OPEC’s secretary general.
Additionally, there has been an ever-evolving narrative that oil and gas are part of the past, he said.
“This is wrong-headed given that oil demand continues to grow. In OPEC’s World Oil Outlook 2021, we see the global oil sector alone needing cumulative investment of $11.8 trillion in the upstream, midstream and downstream through to 2045 to meet future demand. These investments are essential for both producers and consumers, as we could see demand exceed supply if investments are not made. In fact, all these issues of market balance and stability, cooperation, and investments are interlinked, which was underscored clearly at the end of 2021 when energy markets witnessed the strains and conflicts related to affordability, security and reducing emissions,” added Barkindo.
He went on to add that it is vital that all stakeholders focus on all these issues.
“We need to remember that focusing on only one of them, while ignoring the others, can lead to unintended consequences. This needs to be central to our thinking as we chart a path out of the pandemic, and view the future energy transition. It is important to stress that OPEC and participants in the DoC do not focus on prices. We are committed to ensuring a balanced market, with a sustainable stability that provides a platform for necessary investments. Our decisions taken throughout the pandemic have focused on this, as exhibited through our data, analysis, and the full transparency related to the decisions taken. Looking ahead, we remain measured and attentive to evolving market dynamics,” said OPEC’s secretary general.
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