2005 - OPEC

As an industry we have to be inclusive and such extended dialogues have enabled us to learn
much more about each other and confer in detail about the numerous energy concerns of
common interest. In particular, the wide ranging and mutually dependent issues of security of
supply and security of demand and the function oil plays in supporting the global economy. It
is a process built on a pragmatic attitude of give-and-take towards each others’ interests and
the basis for the establishment of positive long-term relationships. The goal is one of common
benefit for all parties, both producers and consumers: the establishment and maintenance of
a more stable and effective international oil market going forward.
Further significant advancements in the producer-consumer dialogue took place in Novem-
ber 2005 when the International Energy Forum’s Secretariat and the Joint Oil Data Initiative
(JODI) database were formally inaugurated in Riyadh, Saudi Arabia. The OPEC Secretariat,
together with five other international organizations, has been behind the development of the
JODI facility, which provides data on oil, gas and refined product output, as well as stocks
and demand from more than 90 countries. It should be remembered that high-quality, timely
information underpins well-functioning markets and today there is a particular need for better
data on the evolution of demand and stocks.
Such constructive cooperation and dialogue are welcome and increasingly necessary in light
of the many challenges the industry faces. These challenges were in fact the impetus behind
OPEC’s launch of its Long-Term Strategy (LTS) document in September 2005. The Strategy puts
forward a coherent and consistent framework for the Organization’s future, with the recogni-
tion of oil’s importance in meeting future global energy demand – it is widely expected that
oil will maintain its leading position in satisfying the world’s energy needs for the foresee-
able future – and its significance to the future socio-economic development of OPEC Member
Countries (MCs).
Key themes of the LTS include the challenges that may impact future global oil demand, such
as world economic growth and expanding vehicle usage, country demographics, consuming
countries’ energy and environmental policies, technological development and how future non-
OPEC production might evolve. These issues compound the uncertainty regarding how much
oil will be needed from OPEC to achieve a supply and demand balance.
The LTS explores these challenges and uncertainties in three consistent scenarios, the first of
which envisages a future following previous oil demand patterns, with the other two exploring
futures leading to lower and higher rates of oil demand growth, respectively. The difference
between the lower and higher rates of oil demand growth out to 2020 is more than 12 mb/d