As the Secretary General of the Organisation of the Petroleum Exporting Countries, I am very pleased to speak to you today at this 14th World Petroleum Congress of high level officials of the governments and industrial sectors related to oil.
It was less than three years ago that I concluded my address to the 13th World Petroleum Congress which met at Buenos Aires with a note about the need for expanding the co-operation in the oil industry and between the developing and industrialised countries. At the Organisation of the Petroleum Exporting Countries, we believe now more than ever in the need for such co-operation. This is one of the key areas about which our Member Countries agree unanimously.
Let me please go over my points of discussion by a brief review of the background: BACKGROUND World oil and energy demand expanded strongly during the early '70s when the oil price was kept artificially at a very low level by the international oil companies as in the '60s. Due to the unreasonably low prices at that time, our Member Countries had to meet an ever-increasing demand for crude oil at a flat price, while the price of industrial goods exported by the industrialised countries grew strongly for an extended period. OPEC found itself obliged in 1973 to adjust the price of oil. Many consumers, however, did not appear to see things quite the way OPEC did. While OPEC maintained that the trend of oil supply established just before the event could not have been continued at any reasonable cost, the consumers preferred to neglect the true grounds for such a correction.
The 1973/74 oil price adjustments that were so inevitable were branded unfairly if not quite wrongly a shock to the world oil and economy. Naturally, the price adjustment affected all the energy consumers in the industrialised countries as well as the developing countries. OPEC believed that it had to do all it could to shield the oil-importing developing countries from the full effects of oil price rise. Therefore, OPEC established its own ‘development fund’ for the sake of developing countries. This fund was later given its own legal status as an inter-governmental organisation, separate from OPEC, and was named 'The OPEC Fund for International Development'. I am glad to highlight here that, through the available aid-channels, including the OPEC Fund, the OPEC Countries have by now used a total of around $98 bn, equivalent to a full one percentage point of their GDP, for assistance to the developing world at large since 1973.
Soon after the early price adjustments, the supply of newly developed non-OPEC oil and the tall orders for nuclear power stations got under way. Although the energy content of finished goods wa