At first meeting after oil deal, OPEC, non-OPEC states agree to ‘fully conform’

The Joint OPEC-Non-OPEC Ministerial Monitoring Committee (JMMC) concluded its inaugural meeting on Sunday, recording what the OPEC Secretariat called “a satisfactory” high-level meeting.

The JMMC was established following OPEC’s 171st ministerial conference decision of November 30, 2016, and the subsequent declaration of cooperation made at the joint OPEC-non-OPEC ministerial meeting held on December 10.

At the December meeting, 11 non-OPEC oil producers cooperated with the 13 OPEC states in a concerted effort to accelerate the rebalancing of the global oil market through an adjustment in combined production of 1.8 million barrels per day.

The resulting declaration, which came into effect on January 1, 2017, is for six months, and is extendable for an additional six months pending the status of supply and demand, as well as global inventories.

The JMMC is tasked with ensuring that the objectives of OPEC’s 171st ministerial conference decision and the declaration of cooperation are achieved through successful implementation of voluntary adjustments in production.

The JMMC will also facilitate the exchange of joint analyses and outlooks, which will provide valuable input to the evaluation of the conformity process.

The JMMC is composed of three OPEC member countries – Algeria, Kuwait and Venezuela – and two non-OPEC countries – the Russian Federation and Oman.

The inaugural meeting was chaired by Issam Almarzooq, minister of oil and minister of electricity and water, of Kuwait, who began the proceedings with an opening statement.

Remarks were also delivered by Alexander Novak, Russian energy minister, who is the committee’s alternate chairman; and Khalid Al-Falih, president of the OPEC Conference.

OPEC’s research division briefed the committee on oil market developments that have occurred since the declaration of cooperation was approved in December 2016.

The JMMC then engaged in a detailed discussion regarding the framework for the realisation of the voluntary production adjustments as per the declaration of cooperation.

Reaffirming its commitment to joint cooperation for the achievement of a lasting stability in the oil market in the interest of oil producers and consumers, the committee agreed to full and timely conformity to the agreement with the following stipulations:

The OPEC secretariat will present a monthly production data report on OPEC member countries’ crude oil and of the participating non-OPEC oil liquid production to the JMMC by the 17th of each upcoming month.

Evaluation of conformity to the respective country production adjustment will be based on production data only.