Abu Dhabi: The recent meeting in Doha may not have yielded positive results in freezing production but it was successful in terms of participation and engagement from oil producing countries to stabilise oil prices, Indonesia Governor for Opec (Organisation of the Petroleum Exporting Countries) told reporters in Abu Dhabi.
“If the expectation is to freeze production, of course it was not achieved. But by having communication and engagement and getting participation from more countries it is a success. That was never done before,” said Widhyawan Prawiraatmadja Indonesia Governor for Opec and Special Advisor to Minister of Energy and Mineral Resources.
He dismissed that there could be another meeting between Opec and non-Opec countries in May to stabilise oil prices.
“I don’t think there is such a possibility. There has to be clear understanding and objective for the meeting to happen. If the oil price stays at $45 per barrel, I don’t see any need to freeze output and have another meeting.”
The Doha meeting between eighteen oil producing countries ended without an agreement on freezing output at January levels.
Saudi Arabia insisted that Iran, which is trying to increase oil production after sanctions were lifted join the deal.
When asked whether there is a talk of freezing or quota system in the upcoming meet in Vienna, he said there is no such thing as quotas within Opec.
“Controlling production is not really the name of the game any longer. You have sovereign rights of each country and they can do whatever. Whether they can come into an agreement for a certain level of production, it will have to come from each country and cannot be imposed. “
The next meeting of Opec is scheduled to be held on June 2 in Vienna.
“Opec intention is always to have a stable price that gives fair return on investment.”
On oil prices, he said $50 to $60 is ideal for the industry as well as for the growth of the world economy.
“For Indonesia, oil and gas in Industry require oil price of $50 to keep it going. Otherwise projects would be cancelled or postponed,” he said.
“The key to Indonesia and some countries is sustainable investment. If you don’t have sustainable investment, it would not be so good to the market and is the recipe for prices to shoot up due to potential shortage in oil production in future.”
Indonesia is the newest member of Opec, which has its headquarters in Vienna, Austria. It joined the group initially in 1962 and suspended its membership in 2009. The country reactivated its membership in January this year.
Prawiraatmadja said Indonesia decided to rejoin Opec keeping in mind the national interest specially in energy security.
“We would like to play our role in global context. With different setting in oil market, the role of Opec is changing.”
