Caracas, June 1, 2006

“Ladies and Gentlemen: please receive a warm welcome from the people and the government of the Bolivarian Republic of Venezuela. We are very happy and proud to host you in the 141st Extraordinary Ministerial Conference of the Organisation of Petroleum Exporting Countries (OPEC), and we sincerely hope your stay in our country will be pleasant and productive for everyone.

We believe that this occasion is an extraordinary one in several ways. First of all because it will allow us to ratify the commitments and agreements of the Caracas Declaration issued on OPEC’s 2000 Second Summit; secondly because some fundamentals of the oil market show conditions similar to the ones present when this Summit was held, a Summit remembered by everyone as a milestone in the history of the Organisation; and thirdly because we are experiencing great changes in this context that could have unforeseeable mid-term consequences.

We also believe that the Second Summit in Caracas served as a platform for the “rebirth” of the sole cooperation and cohesion purpose during the hard times the Organization was experiencing, and that it allowed the recovery of the capacity to balance the market under the criterion of fair prices for our resources. We now hope that the 141st Extraordinary Ministerial Conference will serve as a platform to carry out strategic evaluations that will allow us to overcome the obstacles and threats that hover over our countries as ghosts.

The success our Organization has had in the past six years arises from the cohesion of a common policy and strategy for our countries, swiftness of action, and the technical capacities of our teams. We have performed according to the strategic orientations of our Heads of State, and we have been able to successfully defend the principles on which our Organisation was founded.

Our current challenges are different, but not easier. Geopolitical tensions, participation in speculative markets and the huge “paper” crude volumes negotiated in futures markets are new variables that grow alarmingly. A large portion of the current prices is caused by these factors, factors that will not disappear, that we are just starting to understand, and that are almost beyond our control.

The cost of inputs and services has shockingly increased, and the crude average world basket is increasingly being composed by more heavy crudes, thereby increasing processing costs. Even worse, driven by nominal levels of “high” prices, dozens of exploration, production and refining projects that will allow a considerable increase in the offer inside and outside our Organisation have been undertaken worldwide, thereby increasing prices even more and creating a scarcity of human and material resources never seen before. We are in the middle of a circle that will have, without a doubt, a hard-to-predict outcome.

The next years will define the strength of the judicial and tax framework, and the coordination of public policies among member countries. The use of the word ‘public’ carries the implicit message that we care for the welfare of our peoples. There is no other possible way when dealing with a non-renewable natural resource on which the lives and future of millions of people depend on.

Part of our sovereign reaffirmation is the profound conviction that our reserves should turn into a better quality of live for our people. In our case, this conviction has evolved into productive social development, support to cooperatives, and a change in the way companies distribute their profits among their participants based on the Social Production Company model.

We have been successful, I repeat, in stabilizing the market, but there cannot be external stability without internal stability, and I am referring to economic, political and social stability in our countries. This stability is nowadays threatened by the shadow of interventionism and State terrorism resulting from the desire of some nations to take over oil reserves by force. Internal social stability in our nations is an essential requirement for integral stability, which includes market and income stability.

Under current conditions we cannot be victims of double standards or be subject to pressures of the media that observes and disseminates only what helps it to convert, with one stroke of the pen, rumours and suppositions into facts. It is sad to be a hero of what one says and victims of what others omit.

Following the best spirit of the founders of our Organisation, we cannot be satisfied with our achievements. The Conference that begins today should constitute a new platform of criteria for our Organisation, defined by sovereign reaffirmation over the resources, and the absolute conviction that sovereign people should receive the benefits of the applied strategies that translate into better quality of life.