OPEC REPEATS NEED FOR OUTSIDE FUNDING

The Organization of Petroleum Exporting Countries has reiterated its need for massive financial help--and soon--to meet demand for member nations' oil later in the decade. The group predicts demand for OPEC oil will reach nearly 31.5 million b/d by 2000. It estimates outlays totaling $60 billion will be needed to achieve that volume. "The level of investment required for this lies well beyond the capabilities of our members," OPEC Sec. Gen. Subroto said.

April 29, 1991

2 min read

The Organization of Petroleum Exporting Countries has reiterated its need for massive financial help--and soon--to meet demand for member nations' oil later in the decade.

The group predicts demand for OPEC oil will reach nearly 31.5 million b/d by 2000. It estimates outlays totaling $60 billion will be needed to achieve that volume.

"The level of investment required for this lies well beyond the capabilities of our members," OPEC Sec. Gen. Subroto said.

Subroto told a joint meeting in Houston of the American Petroleum Institute and International Association of Drilling Contractors oil supplies from non-OPEC producers will decline to 27 million b/d in 1995 and to 26.2 million b/d by 2000 from about 27.3 million b/d at present. At the same time, world demand, excluding countries with centrally planned economies, will increase to 54.8 million b/d in 1995 and 57.7 million b/d in 2000.

If so, the call on OPEC oil would grow to 27.8 million b/d in 1995 and 31.5 million b/d in 2000 from current demand of 24.5 million b/d, Subroto said. To maintain flow at those levels, OPEC would need a productive capacity of at least 33 million b/d.

"If we are to avoid a supply crisis in the future, assistance will be needed from consumers and non-OPEC producers alike," he said. "And because expanding production capacity requires long lead times, action should be taken very soon."

OPEC members hold 78% of world oil reserves and have a combined reserves to production ratio of more than 100 years. By the end of the century, the ratio is expected to be about 80 years.

By contrast, Subroto said, the reserves to production ratio of the rest of the world is 16 years.