Kuwaiti Oil Barrel Price72.07 Date:12-11-2024

Works Sheets

Economic Affairs

Report of the OPEC Conference held in Berlin, Germany, October 6-8, 2020

Day one

The tasks and sections that contribute to the success of the Organization in achieving the desired objectives, the mission of the Organization of Petroleum Exporting Countries (OPEC), are defined as:

  • Coordination and unification of petroleum policies of its member countries.
  • To ensure the stability of oil markets to ensure an efficient, economical, and orderly supply of petroleum to consumers.
  • A stable income for producers and a fair return on capital for those who invest in the petroleum industry.
Day two: "Oil Market Survey"

The extent of its impact on the Coronavirus pandemic and prospects for financial stability. - Economic Challenges in Developing Countries: Fears of the Second Wave of the Coronavirus, Global Economic Development Better Pursued and Oil Prices Developed. The latest developments in the extraction and production of oil from the depths of water.

Day three: "Medium-term and long-term Oil market impacts"

The importance of monitoring the world economy and the importance of Oil demand
The Oil market is a major factor in global economic growth: -

  • Stable oil markets support reasonable levels of economic inflation
  • Oil has also become a very important input factor in many product categories (petrochemicals)
  • 3- Exports of crude Oil and petroleum products represent the largest category of commercial goods in world exports.

World GDP growth forecast World economic growth for 2020 stands at 4% while growth in 2021 is expected to recover to 4.7%
New study launched in 2020

  • Assessment of the global crude Oil supply and demand balance in terms of the quality of the crude Oil.
  • Recent developments in natural energy modernization in the United States.
Day two: "Oil Market Survey"

The Facts in an Oil Market Study

  • The constant monitoring and analysis of the development of the Oil and product market in the short term.
  • Promote understanding of OPEC's views on short-term market developments

Study of the Oil market

  • Report of the Oil market to the OPEC meeting.
  • Prepare periodic reports on developments in the world Oil market.
  • Fostering short-term forecasting and study of both Oil demand and Oil saving and economic growth have been discussed in detail as to their importance.
    • Short-term Oil demand (modeled after the relationship between Oil demand and GDP and prices).
    • study on short-term Oil saving) Enhance the accuracy of forecasting in the short-term estimate of the flexibility of current prices for non-OPEC members.
    • Short-term economic growth prospects (applying the latest technologies to boost economic growth).

As mentioned, what are the latest developments in deep water oil extraction and production since the 1980s Oil exploration and production in deep water has become one of the most important trends as different platforms are used to extract Oil. The cost varies according to the depth. At present, deep-water production has become more feasible through advanced technology. (A summary of the latest developments in deep water Oil extraction).

  • The world's traditional liquids discoveries are far smaller than current global oil production sources such as Oil sands, tight Oil, and biofuels that have filled the gap.
  • In 2019, the production of very deep water (< 5,000 feet) increased by 3.3 times, from about 950 terabytes/day in 2010 to an average of 3.1 million barrels/day, while that of the continental shelf decreased by 4.3% in the same period.
  • Technological innovation in the United States led to the extraction of narrow and unconventional crude Oil from natural gas liquids, aided by cracking and horizontal drilling from narrow rock and rock formations, by 11.9 million barrels per day in 2019, 7.6 times the 2010 level of 1.6 million barrels per day.
  • deep-water tight crude Oil, undisguised biofuels from natural gas liquids, and Oil sand production are the main drivers of growth in non-OPEC Oil supplies.
Day three: "Medium-term and long-term oil market impacts" of the importance of monitoring the world economy

  • The impact of the COVID-19 pandemic has made a more detailed analysis of the global economy even more important.
  • The relationship between oil prices and asset markets (asset allocation) is driven by actual growth, growth expectations, monetary decisions, etc.
  • The relationship between the economy and supply factors (interest rate level, economic growth prospects, and investment.) An example of the analysis of the model scenario – is COVID-19 for the State of China, whose economy has been negatively affected by oil imports and investment in world markets.

Some of the challenges presented were that the relationship between the economic growth of energy and oil demand continues to decline, and the unexpected external factors that influence forecasting such as natural events or changing fiscal and monetary policies.

The importance of Oil demand
This study is important and is one of the most important ones to focus on, given that Kuwait is considered an Oil-exporting country

  • In the short-term oil demand survey forecasts, the amount of OPEC production is measured in terms of market balance.
  • Oil demand prospects serve as the basis for investment in productive capacity for medium- and long-term expansion.
  • The methodology of the study and the forecasting of oil demand is through three stages: quantitative analysis, a historical review of demand, and sectoral analysis. Most of the projections of the demand model are based on the following main variables: -
    1. GDP: a close link between GDP and growth in Oil demand (varies across regions).
    2. Price: Sensitivity of the price of Oil demand.
    3. Policy: Use of alternative fuels.
    4. Weather: The weather affects seasonal Oil consumption.
    5. Forecast period: measured quarterly.
    6. Component: Total consumption of petroleum products (gasoline, diesel, fuel Oil, liquefied petroleum gas, etc.).
    7. Sectors: Total consumption, for example, on housing, transportation, and other means of transport.

Conclusion

  • Forecasting Oil demand is critical to assessing investment capacity and demand for OPEC crude.
  • The number of factors used to predict oil demand was mentioned.
    1. Uncertainty in oil demand forecasts generates different methodologies.
    2. The complexity of collecting Oil consumption statistics.
    3. Time in historical data reported.
  • World Oil demand growth for 2020 is expected to shrink by about 9.5 million barrels per day.

Attachments

Ministry
of Oil Tender
Announcement

Ministry of Oil Building - Oil Sector - Third Floor
Finance Department

Maintenance of Core Switches and its equipment for a period of one year

Supply and installation of connection devices to the Kuwait Information Network

Purchase and installation of office units and offices



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