OPEC

= =

fffffffffff OPEC (Organization of the Petroleum Exporting Countries) is a coalitionor cartel of countries that are involved in the production and exporting of petroleum. OPEC was founded by five countries: Iran, Iraq, Saudi Arabia, Kuwait, and Venezuela. They were later joined by Algeria, Angola, Ecuador, Libya, Nigeria, Qatar and United Arab Emirates. OPEC's main objectives include: the creation of standard petroleum policies which make prices uniformly and fair for each member nation, an economic and plentiful supply of petroleum to consuming nations, and lastly, to be able to give a certain amount of revenue to investors. These countries banded together because they had something in common; they were all developing nations with major amounts of oil in their country. fffffffffff Since OPEC was first created in 1960, it has gone through many turmoils and in turn victories to get to where they are today. When created in 1960 the five founder countries developed certain missions that that were goals and in 1965 it founded a Secretariat( basically headquarters) in Geneva that was later moved to Vienna. In 1968, the coalition adopted a ‘Declaratory Statement of Petroleum Policy in Member Countries’ which basically meant that the member countries had the right to control their own natural resources and that this right could not be revoked. This act gained members and by 1970 OPEC had acquired a large say over oil prices throughout the world. Through the 1970's to the 1990's, OPEC was faced with various oil price issues that weakened the cartel considerably. This happened because of multiple reasons that include: consumers edging away from oil because of environmental concerns, wars in member countries, and economic hardships. At the end of this period OPEC recovered. In the 2000's the price of oil rose but then it crashed with the global economic recession in 2008. OPEC was a major representative for the oil businesses during the global economic downfall. This said, OPEC still suffered. I n my mind OPEC is not a ruthless cartel that everyone thinks it is because of some of the things they have achieved. For example they have an OPEC fund for International Development. This a financial aid to member and non-member countries to help promote relations with third world and developing countries. OPEC started this project with 800 million dollars to give to poor and underdeveloped countries. This amount has been emptied in the interest of other countries three times and has been replenished. So far this fund has helped 125, countries which the majority of them in Africa and Asia. The poorest countries recieving the most money from the fund. Aside from that, foreign relations with other non-member countries have been difficult. The United States for example is not on very good relations with OPEC. This is because they are monopolizing the oil market and driving prices higher and higher. The United States wants this coalition disbanded because then the oil that we produce may be more profitable and OPEC could not drive up the prices and maximize their profit. fffffffffff Because of the exorbitant price, non-member countries are trying to change their economies to lessen thier the reliance on oil and in turn OPEC. Many new technologies are coming out. Renewable resources like solar, wind, and hydroelectric are leading the way to less dependence on oil. Also hybrid cars and other gas conserving vehicles are coming out. Also many energy saving devices have come out that are trying to relieve our society from it's dependence on oil. OPEC was created in the interest of capitalizing the oil industry and creating standard prices which would guarantee the product's stability. Many people think that OPEC is a ruthless cartel that continuously raises the price of oil, making non-member countries pay a lot. What people don't realize is that in these OPEC countries, oil is their only export and it is all that keeps the standard of living at a normal level. We must respect that. Although I agree with renewable resources, I do not think that these countries should be robbed of their only product. OPEC has gained billions of dollars from the world and that should be given to the people but I do not think most of it is. The twelve countries that form this cartel are losing the grip on the oil market because many other countries are starting to find oil in their countries, this is good for the U.S., but OPEC is still is the major contender in the world for buying and selling oil.
 * Intro essay on OPEC **

By Tim Kistner, Laura Greever, Nicholas Vallerio, Cassidy Czerpak and Amy Pertuset