1998 News Story

GCC oil ministers issue communique

Oil Minister Ali Al Naimi led the Saudi delegation at the twenty-first session of the ministerial

committee for oil cooperation among the Gulf Cooperation Council (GCC) states, which ended

in Riyadh today.   The joint communiqué released at the end of the meeting said the Ministers

of Petroleum of the GCC states reviewed the situation in the oil market and listened to a

comprehensive report submitted by Minister Al-Naimi on the Amsterdam Agreement, which

complements the Riyadh agreement.  The communiqué noted that although the amount of

reductions in production quotas that was agreed upon at the OPEC conference was 1,245,000

barrels per day, the glut in the oil market has continued due to a failure to carry out the

agreement fully.

The ministers expressed their absolute support for the Amsterdam Agreement, which was

honored by the Kingdom of Saudi Arabia, Venezuela and Mexico, who reduced their actual

production by a combined total of 450,000 barrels per day in addition to their adherence to the

Riyadh Agreement.  Also noted was the reduction made by Qatar, and the decisions made to

reduce production by the United Arab Emirates (75,000 bpd), by Kuwait (75,000 bpd), and by

Oman (20,000 bpd), in addition to the reductions made by these countries in March 1998.   

The new reductions will take place effective July 1, 1998, and will continue until the end of

this year.
The joint communiqué said that this will raise the total of pledged reductions by GCC member

states since the Riyadh Agreement in March, to 1,025,000 per day, and are in addition to

reductions pledged earlier by OPEC member states as well as to those made by other oil

producing countries in February, 1998, as published by independent sources.
The GCC member states aim at re-stabilization of the petroleum market and hope that the

other OPEC countries will contribute to these efforts at their meeting scheduled for June 24,

1998.  The GCC also hopes that non-OPEC states will contribute to the ongoing efforts for

re-stabilization of the petroleum market in a manner that serves the interests of both oil

producers and consumers.