Organization of the Petroleum Exporting Countries | |
|---|---|
 Flag
 Emblem
| |
 OPEC and OPEC+ members | |
| Headquarters | Vienna, Austria |
| Official languages | English |
| Type | Organization[1][2] |
| Membership | 12 OPEC members 10 OPEC+ members 6 observer states |
| Leaders | |
| Haitham al-Ghais | |
| Establishment | Baghdad, Iraq |
• Statute | September 1960 |
• In effect | January 1961 |
Website opec.org | |
The Organization of the Petroleum Exporting Countries (OPEC, /ˈoʊpɛk/ OH-pek) is a cartel enabling the co-operation of leading oil-producing and oil-dependent countries in order to collectively influence the global oil market and maximize profit. It was founded on 14 September 1960, in Baghdad by the first five members which are Iran, Iraq, Kuwait, Saudi Arabia, and Venezuela. The organization, which currently comprises 12 member countries, accounted for an estimated 30 percent of global oil production.[3] A 2022 report further details that OPEC member countries were responsible for approximately 38 percent of it.[4] Additionally, it is estimated that 79.5 percent of the world's proven oil reserves are located within OPEC nations, with the Middle East alone accounting for 67.2 percent of OPEC's total reserves.[5][6]
In a series of steps in the 1960s and 1970s, OPEC restructured the global system of oil production in favor of oil-producing states and away from an oligopoly of dominant Anglo-American oil firms (the "Seven Sisters").[7] In the 1970s, restrictions in oil production led to a dramatic rise in oil prices with long-lasting and far-reaching consequences for the global economy. Since the 1980s, OPEC has had a limited impact on world oil-supply and oil-price stability, as there is frequent cheating by members on their commitments to one another, and as member commitments reflect what they would do even in the absence of OPEC.[8] However, since 2020, OPEC countries along with non-OPEC participants had helped in stabilising oil markets after the COVID-19 pandemic resulted in a collapse in oil demand. This has allowed oil markets to remain stable relative to other energy markets that experienced unprecedented volatility.[9]
The formation of OPEC marked a turning point toward national sovereignty over natural resources. OPEC decisions have come to play a prominent role in the global oil-market and in international relations. Economists have characterized OPEC as a textbook example of a cartel[10] (a group whose members cooperate to reduce market competition) but one whose consultations may be protected by the doctrine of state immunity under international law.[11]
Current OPEC members are[ref] Algeria, Equatorial Guinea, Gabon, Iran, Iraq, Kuwait, Libya, Nigeria, the Republic of the Congo, Saudi Arabia, the United Arab Emirates and Venezuela. Meanwhile, Angola, Ecuador, Indonesia, and Qatar are former OPEC members.[12] A larger group called OPEC+, consisting of OPEC members plus other oil-producing countries, formed in late 2016 to exert more control on the global crude-oil market.[13] Canada, Egypt, Norway, and Oman are observer states.
- ^ "GLOSSARY". U.S. Energy Information Administration. Retrieved 8 April 2024.
- ^ Jelley, Nick (19 January 2017), "OPEC", A Dictionary of Energy Science, Oxford University Press, doi:10.1093/acref/9780191826276.001.0001, ISBN 978-0-19-182627-6, retrieved 8 April 2024
- ^ "Opec: What is it and what is happening to oil prices?". BBC News. 3 May 2022.
- ^ "Where our oil comes from - U.S. Energy Information Administration (EIA)". www.eia.gov. Retrieved 26 March 2024.
- ^ Organization of the Petroleum Exporting Countries. (2023). OPEC Annual Statistical Bulletin (58th ed.), 90 pages. Retrieved from https://asb.opec.org/. ISSN: 0475-0608. (See pages 7 and 22).
- ^ "OPEC Share of World Crude Oil Reserves".
- ^ Colgan 2021, The Rise of OPEC, pp. 59–93.
- ^ Colgan, Jeff D. (2021). "The Stagnation of OPEC". Partial Hegemony: Oil Politics and International Order. Oxford University Press. pp. 94–118. doi:10.1093/oso/9780197546376.001.0001. ISBN 978-0-19-754637-6.
- ^ Stevens, Pippa (9 April 2020). "OPEC and allies agree to historic 10 million barrel per day production cut". CNBC.
- ^
LeClair, Mark S. (8 July 2016) [2000]. "The History and Evlauation of Significant commodity Cartels". International Commodity Markets and the Role of Cartels (reprint ed.). Abingdon: Routledge. p. 81. ISBN 978-1-315-50088-1. Retrieved 11 June 2023.
OPEC, the most notorious of the modern cartels, functioned effectively for only thirteen years.
- ^
Terhechte, Jörg Philipp (1 December 2009). "Applying European Competition Law to International Organizations: The Case of OPEC". In Herrmann, Christoph; Terhechte, Jörg Philipp (eds.). European Yearbook of International Economic Law 2010. Heidelberg: Springer Science & Business Media. p. 195. ISBN 978-3-540-78883-6. Retrieved 11 June 2023.
[...] the question whether OPEC's activities, those of its member states and those of the state-owned enterprises are protected by the principle of State Immunity is to be answered in accordance with the preconditions set by the UN Convention as an expression of common principles of International law. [...] The crucial question [...] in terms of International law is: 'Is OPEC engaged in commercial activities or not?'
- ^ "OPEC: Member Countries". opec.org. Retrieved 22 April 2020.
- ^ Cohen, Ariel. "OPEC Is Dead, Long Live OPEC+". Forbes. Archived from the original on 2 August 2019. Retrieved 2 August 2019.
The deal represents the latest successful policy effort by the 24 member supercartel, informally referred to as the 'Vienna Group' or 'OPEC+,' to put their thumb on the scale of global oil markets. And it's a huge thumb indeed. [...] OPEC's 14 members control 35 percent of global oil supplies and 82 percent of proven reserves. With the addition of the 10 Non-OPEC nations, notable among them Russia, Mexico and Kazakhstan, those shares increase to 55 percent and 90 percent respectively. This affords OPEC+ a level of influence over the world economy never seen before.