The Organisation of Petroleum Exporting Countries (OPEC), yesterday, elected Kuwait’s former OPEC governor Haitham Al-Ghais to become the group’s next Secretary-General, once Nigeria’s incumbent Mohammad Barkindo’s term expires at the end of July.
Also, the cartel warned of significant levels of uncertainty in the weeks to come, owing to the Omicron variant, uneven pace of economic growth and continued supply chain disruptions.
Al-Ghais, who acted as the first-ever chairman of the OPEC+ Joint Technical Committee (JTC), was elected by majority vote at an extraordinary ministerial OPEC meeting that was held just for that purpose.
His term begins in August. OPEC secretaries-general are appointed for an initial three-year term, which can typically only be extended once for another three years.
OPEC ministers will meet with their non-OPEC counterparts today to discuss and decide on production policy for February – specifically whether to press ahead with a 400,000 b/d increase in the OPEC+ group’s production quota, as planned under the roadmap it agreed in July.
In his opening remarks, Barkindo said that despite the ongoing uncertainties, the flexible approach to supply management has helped to provide an added sense of stability, reassurance and continuity to the market and investors.
“Despite the steady progress that has been made in terms of the economic recovery, we do expect significant levels of uncertainty in the weeks to come, which could slow the growth momentum.
“In addition to closely monitoring the evolving impacts of the Omicron variant, other factors to consider will be the varying speed of vaccine rollouts worldwide; the uneven pace of economic growth across global regions; and continued supply chain disruptions. Additionally, rising inflationary pressures and potential central bank responses remain key factors that require close monitoring.”
On the demand side, he said that some of the recovery previously expected in the fourth quarter of 2021 has now shifted to the first quarter of 2022, followed by a more steady recovery throughout in the second half of 2022, though risks are skewed towards the downside.
Al-Ghais ran unopposed, despite suggestions that some other delegations would be making their own nominations. Iraq, delegates said, made a case at the group’s previous ministerial meeting at the beginning of December that other member countries should have more time to put forward a nominee before the voting.
The secretary-general is expected to maintain political neutrality and primarily play a significant diplomatic role, both within the OPEC and OPEC+ groups — something that Barkindo, in particular, excelled at during his nearly six years in office.
Barkindo also elevated the African contingent’s position in the group, as the cartel saw the addition of two west African producers during Barkindo’s first term in office – Equatorial Guinea in May 2017 and Congo (Brazzaville) in June 2018.