OPEC’s new researchers face mounting challenges

OPEC’s new researchers face mounting challenges
Updated 06 September 2017

OPEC’s new researchers face mounting challenges

OPEC’s new researchers face mounting challenges

JEDDAH: As of Sept. 1, the newly elected heads of research at the Organization of the Petroleum Exporting Countries (OPEC) assumed their roles at a time when the group's secretariat is facing mounting challenges.
OPEC’s secretariat is an important body and it performs many tasks. At the forefront of this is research that supports the decision-making processes for all market participants, from ministers to investors.
Since the beginning of the month, Dr. Ayed S. Al-Qahtani of Saudi Arabia, Dr. Abderrezak Benyoucef of Algeria, and Iran’s Behrooz Baikalizadeh assumed their roles, according to an OPEC source who spoke to Arab News on the condition of anonymity.
Al-Qahtani, a former leader of Saudi Aramco's Global Economic & Energy Outlook and a former adviser to Saudi Minister of Energy, Industry and Mineral Resources Khalid Al-Falih, was appointed on July 18 as the new director of the research division, replacing Omar S. Abdul-Hamid. The director of research is the second most senior job in the secretariat after the secretary-general post, which is currently held by Nigeria’s Mohammed Barkindo.
Benyoucef has been appointed as the head of the energy studies department, while Baikalizadeh is the new chief of the petroleum studies department.
The three researchers will face a huge challenge, as the secretariat is under extreme pressure from OPEC members to provide more timely analysis of the market under the current agreement between OPEC and non-OPEC states to cut production to restore stability.
“It is not going to be an easy job for the three researchers,” another source told Arab News. “They have a long of list of demands and they need to advance the research to the next level.”
One of the challenges facing the research department of the secretariat is that it needs to produce more studies in addition to their usual routine studies. “We have two super committees to monitor and oversee the cuts agreement at the moment and they need studies every month to support their decisions and recommendations,” said the source, referring to Joint Technical Committee and Joint Ministerial Monitoring Committee.
OPEC’s research department produces a monthly oil market report that is widely read in the industry. It also produces an annual world oil outlook that looks ahead as far as 20 years.
The secretariat currently has 133 staff and does not have enough funds to hire more people to aide with the expanding list of studies, the source said.
“With current oil prices, member countries are looking for cost rationalization more than spending more,” he said.
Another major challenge is that OPEC’s secretariat needs to keep ministers well-informed about developments in shale oil and other issues — and so far that seems to be a tough job.
“Ministers aren’t happy about OPEC’s studies on shale oil but to understand shale oil, you need to interact more with US producers and hire more independent consultants. “That will cost more money, so without more support from minister, the task won’t be easy to do,” the source said.