OPEC

Saudi Arabia and United Arab Emirates Invites Indonesia to Re-Join OPEC

Saudi Arabia and the United Arab Emirates have invited Indonesia to rejoin the Organisation of Petroleum Exporting Countries (OPEC) less than a year after Indonesia withdrew.

Sujatmiko, Head of Communications, Public Service and Information and the Ministerial Cooperation Bureau at the Ministry of Energy and Mineral Resources, said the invitation was made by the Saudi and UAE Ministers of Energy.

Indonesia rejoined OPEC in 2015 under the leadership of then energy minister, Sudirman Said, before withdrawing in 2016 under current Minister Ignasius Jonan following the organisation’s policy to cut 1.2 million barrels of oil per year per member in production.

Indonesia officially withdrew at the 171st OPEC Assembly in Austria, November 30, 2016. OPEC changed the production policy after a steady decline in demand.

“Indonesia has a considerable role in the field, so we’re being courted by OPEC members,” Sujatmiko said.

The Ministry responded to the invitation by clarifying terms of membership.

“The Minister has sent the OPEC a letter on May 24 with a condition that OPEC will not cut (Indonesia’s) domestic oil protection in consideration of already declining production,” Sujatmiko said.

The potential reactivation of membership is hoped to strengthen relationships between Indonesia and member countries.

“If this invitation for Indonesia to join OPEC brings bilateral or even multilateral benefit, we hope Indonesia can gain advantages in better opportunities for investment in the oil and gas upstream sector and a special price for crude oil from other OPEC members,” Sujatmiko said.

“Usually, maintaining bilateral and multilateral relationships between members will smoothen the cooperation process.”

Reactivation of membership is set to renew interest in Indonesia’s oil and gas sector, which has undergone a series of reforms during the ministry’s change in leadership.

See: Government Simplifies Business Permits For Oil And Gas

Image credits: Josstoday

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Oliviana Handayani is a writer at Content Collision.


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