OPEC , Moscow Institute of Economical Politics forecast global oil market development trends

The Second Joint OPEC/MGMO Workshop was held in Moscow on 29 October, 2004 to further the cooperation process launched by the two sides in March 2002. The initiative was officially launched at the first such bilateral workshop, held in Vienna, in July 2003. At that meeting, a clear convergence of opinion emerged that the oil sector would remain one of the world's leading industries for at least the next 20 to 30 years, and that cooperation between OPEC and Russia would greatly enhance market stability and predictability with regard to supply and demand, and prices. Today's workshop reinforced the resolve of participants to work towards establishing a joint approach to matters of importance that will assist cooperation between the two sides and help overcome future challenges.

,In acknowledging the increasing importance of research and analysis of the short and long-term perspectives of world oil market developments, and having discussed presentations by leading experts, as well as studied remarks and proposals submitted in the course of constructive and intensive deliberations, the workshop's participants agreed on the following observations concerning the key trends of world oil market developments:
- The world oil industry continues to be a leading sector of the global economy. According to our experts, oil will remain the most important fossil fuel in the energy mix over the next 20-30 years.
- The workshop observed that global oil demand is forecast to reach around 83 million barrels per day in 2005, and to rise to 115 million b/d in 2025. It was pointed out that the long-term projection was a tentative figure and subject to change, in line with the changing dynamics of the market.
- The coordination of energy policies of Russia and OPEC will assist in promoting world oil market stability.
- Further encouragement of intergovernmental cooperation will help stabilize oil markets and enhance energy security. A comprehensive examination of elements and factors required to form a better understanding of world oil market trends is deemed essential.
- Economic factors will continue to substantially affect world oil market trends, making further analysis of ongoing developments imperative.
- The role of oil companies and government policies in Russia, as well as OPEC's thinking on market stabilization measures, should be taken into account for the purpose of promoting improved coordination between Russia and OPEC.
- The continuing importance of hydrocarbons is a reflection of the industry's sound and abundant resource base, backed by well developed and effective infrastructure for transportation and refining.
- Workshop participants acknowledged the value of exchange of information and joint research in helping to tackle future oil market challenges (investment, oil and gas supply and demand, capacity expansion plans etc.) in Russia, the Caspian states, and other CIS countries, as well as addressing multi-lateral issues, such as the WTO negotiations, and the Kyoto Protocol.


,Workshop participants expressed deep satisfaction with the outcome of the discussions and concluded that similar meetings would be held on an annual basis, with the next workshop due to be held again in Vienna. It was agreed in the meantime to pursue the setting up of exchange programmes between the two sides, which are designed to expand and strengthen bilateral cooperation.



Author: Moscow Institute of Economical Politics