2005 - OPEC

When the process of drawing up a LTS began in March 2003, the oil market was experienc-
ing a high level of stability. Recently, however, the market has been more volatile, making a
long-term strategy for the Organization all the more relevant. Meetings of the MCs’ Deputy
Ministers of Petroleum/Energy were held under the Chairmanship of HRH Prince Abdulaziz Bin
Salman Bin Abdulaziz Al-Saud, Assistant Minister of Petroleum Affairs, Kingdom of Saudi Arabia,
with Dr Bernard Mommer, Vice Minister of Hydrocarbons, Bolivarian Republic of Venezuela, as
Vice Chairman, and these were supported by the OPEC Secretariat’s Research Division.
The final proposed strategy was presented to the 137th Meeting of the OPEC Conference, which
convened in Vienna on 19–20 September and which gave it its endorsement. The strategy sets
objectives in relation to the long-term petroleum revenues of MCs, fair and stable prices, the
role of oil in meeting future energy demand, the stability of the world oil market, and the
security of regular supplies to consumers, as well as the security of world oil demand. They
also relate to the legitimate interests of OPEC MCs in multilateral agreements. The strategy
identifies the key challenges that may constitute constraints for OPEC in the attainment of the
objectives. These include uncertainties surrounding future oil demand, stemming from, inter
alia, the prospects for the world economy, consuming countries’ energy and environmental
policies, and technological developments. They also concern the supply side, taking into ac-
count the resources, potential non-OPEC production, and the extent and timing of required
investment, together with the associated uncertainties.
While considering the wide range of possible futures and the need to be effective across
these plausible circumstances, the strategy covers various elements, such as the oil price, up-
stream and downstream investment, technology, the role of OPEC National Oil Companies,
multilateral negotiations, in particular those related to trade and the environment, the important
relationships with both producers and consumers, as well as with international organisations
and institutions, OPEC’s public information and the strengthening of the OPEC Secretariat. In
addition, it also includes elements that are pertinent to specific situations, given the need to
be flexible and adaptive. Regarding oil prices, the strategy builds upon the fundamental rec-
ognition that extreme price levels, either too high or too low, are damaging for both produc-
ers and consumers, and points to the need to be proactive under all market conditions. The
strategy also re-emphasises OPEC’s commitment to support market stability and, in achieving
this, stresses the role of other producers, as well as, especially with regard to the downstream
sector, consuming countries. The strategy recommends that OPEC MCs strive to strengthen
cooperation in upstream and downstream scientific research and technological development
among themselves and with international institutions. It also recommends supporting research
in the production and use of cleaner petroleum-based fuels, and taking an active role in the
development of technologies that address climate change concerns, while improving and ex-