Members of the Organization of Petroleum Exporting Countries (Opec) and non-members are considering holding the first Heads of State meeting in nearly a decade to tackle the issue of falling oil prices, Qatar’s Energy Minister has said.
Speaking at the end of a one-day meeting of GCC oil ministers in Doha yesterday, Dr. Mohammed bin Saleh Al Sada confirmed that an emergency summit of leaders of oil-producing states is being studied.
This followed a statement made last week by Venezuelan President Nicolas Maduro, saying he had put the proposal to Qatar’s Emir Sheikh Tamim bin Hamad Al Thani when he met with him in Qatar, and that the Emir had “liked” the idea, Reuters reported.
Venezuela is calling on Opec leaders to decrease production to help boost prices, but those cuts would reportedly have to be shouldered by Gulf countries including Saudi Arabia and Qatar, among others, which all have excess spare capacity.
Addressing reporters in Doha yesterday following the 34th session of the GCC Petroleum Cooperation Committee, newswire AFP reports Al Sada as saying:
“The (Venezuelan) president has proposed a summit meeting and this was announced. Now various countries are studying the proposal. Whether Opec and non-Opec producers agree to such a proposal remains to be seen.”
If it does go ahead, it would be the first time since 2007 that Opec has held a heads-of-state meeting.
That summit in Saudi Arabia was in very different circumstances, when oil prices were soaring and hit $147 a barrel a year later.
In the last year, the price of oil has more than halved from over $100 a barrel last June to less than $48 for brent crude, as global supply has increased.
Venezuela, which joins Qatar as two of the 12 members of Opec, has been particularly badly hit by falling global oil prices, and has been pushing for months for Opec to meet with Russia to take action to halt the slide.
Speaking yesterday, Maduro said its oil dropped to just $39 a barrel yesterday, Reuters said.
While the proposal may at least be on the table, there has been resistance from other Opec states in the Gulf, as Kuwait, Saudi Arabia and the UAE see no need to meddle in the market, or even consider cutting production.
Saudi’s oil minister Ali Al-Naimi declined to comment officially on the prices yesterday, saying: “The earlier remarks by Qatar’s Al-Sada were enough.”
However, Reuters quoted an unnamed source as saying that the kingdom does not see the point of a summit if it would fail to produce concrete action toward defending oil prices.
“If we are meeting for the sake of meeting, it would backfire,” an Opec source added.
Earlier this week, Qatar’s Finance Minister maintained that it would be “business as usual” for the state’s multi-billion dollar infrastructure and development projects, despite the drop in oil prices.
Unlike some of his Gulf counterparts, Ali Shareef Al Emadi also ruled out cutting state fuel and food subsidies for nationals.
However, in the last year a number of public and private sector firms in Qatar have undergone “reorganization,” cutting staff, slashing budgets and scaling back projects that are not directly connected to hosting the World Cup in 2022.