OPEC (Organization of Petroleum Exporting Countries)

Organization of Petroleum Exporting Countries

Organization of Petroleum Exporting Countries (OPEC), multinational organization (est. 1960, formally constituted 1961) that coordinates petroleum policies and economic aid among oil-producing nations. Its Board of Governors and board chairperson are elected by member nations; OPEC's headquarters are in Vienna, Austria. Members consist of Algeria, Angola, Ecuador (membership suspended 1992–2007), Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, the United Arab Emirates, and Venezuela. Indonesia was a member but suspended its membership in 2008. Saudi Arabia has traditionally dominated the organization, owing to its enormous oil reserves; the organization's members produce about 40% of the world's crude oil.

In 1973, as a result of the Arab oil embargo against Western nations who supported Israel during the Yom Kippur War (see Arab-Israeli Wars), OPEC was able to raise oil prices tremendously; the price hike caused inflation in oil-importing nations. Increases ensued from 1975 to 1980. However, as importing countries pursued alternate energy resources, OPEC was forced to lower prices by 1982. Oil prices remained low through most of the 1980s and 90s, with only a temporary hike during the Persian Gulf crisis of 1990–91 (see Persian Gulf War). With the cooperation of non-OPEC oil-exporting nations, OPEC was able to raise prices in 1999 by cutting production. As prices rose above $30 a barrel in early 2000, OPEC members agreed to increase production somewhat, cutting back production again a year later in an attempt to maintain prices. A worldwide economic slowdown caused oil prices to fall to near $20 by late 2001, but cutbacks by OPEC and non-OPEC nations, an economic rebound (including very strong economic growth in China), and the U.S. invasion and occupation of Iraq subsequently caused benchmark prices to rise and stay above $40 in mid-2004. Efforts by OPEC to control prices, however, have generally been less influential than market forces, which in 2008 drove the price of oil to nearly $150 in midyear and down to below $40 the year's end.

The Columbia Encyclopedia, 6th ed. Copyright© 2013, The Columbia University Press.

Selected full-text books and articles on this topic

Intergovernmental Commodity Organizations and the New International Economic Order
Amer Salih Araim.
Praeger Publishers, 1991
Librarian’s tip: Chap. 4: "The Organization of Petroleum Exporting Countries," Chap. 5 "The Growth of OPEC," and Chap. 6 "Relations between OPEC and Other Components of the International Oil Market"
The New Global Oil Market: Understanding Energy Issues in the World Economy
Siamack Shojai.
Praeger Publishers, 1995
Librarian’s tip: Chap. 8 "OPEC: Past, Present, and Future"
The Politics of Oil-Producer Cooperation
Dag Harald Claes.
Westview Press, 2000
OPEC, the Petroleum Industry, and United States Energy Policy
Arabinda Ghosh.
Quorum Books, 1983
The Clumsy Cartel
Adelman, M. A.
Harvard International Review, Vol. 23, No. 1, Spring 2001
The Natural Law Basis of Legal Obligation: International Antitrust and OPEC in Context
Moore, Joel Brandon.
Vanderbilt Journal of Transnational Law, Vol. 36, No. 1, January 2003
OPEC: Ensuring an Energy-Secure Future
UN Chronicle, Vol. 40, No. 2, June-August 2003
Which Way Now for OPEC?
Ford, Neil.
The Middle East, No. 343, March 2004
OPEC Maintains Firm Resolve
Siddiqi, Moin A.
The Middle East, May 2001
Price-Fixing at the Pump. Is the OPEC Oil Conspiracy beyond the Reach of the Sherman Act?
Rueda, Andres.
Houston Journal of International Law, Vol. 24, No. 1, Fall 2001
Opec's Runaway Horses: Although OPEC Has Increased Output Quotas in Response to the 'Unreasonably' High Current Oil Prices, Some Members, Including the African Trio, Are Likely to Ignore Ceilings and Go Their Merry Way. (Oil and Gas)
Ford, Neil.
African Business, March 2003
Fundamentals of Petroleum Trading
Hossein Razavi; Fereidun Fesharaki.
Praeger, 1991
What OPEC Did Next ...: In the Face of Rising Concern over Conflict in Iraq and the Troubles in Venezuela, What Will the 10 Member Cartel Pull out of the Hat to Calm the Troubled Oil Market This Time? (Oil)
Ford, Neil.
The Middle East, March 2003
The Oil Market in the 1980's: A Decade of Decline
Siamack Shojai; Bernard S. Katz.
Praeger Publishers, 1992
Librarian’s tip: Part 1 "OPEC and Non-OPEC Supplier Experience"
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