OPEC is an abbreviation made up of the first letters of the English phrase The Organization of the Petroleum Exporting Countries (which stands for Organization of Petroleum Exporting Countries). The tasks of OPEC members are to support economically justified and profitable prices for the production and sale of oil, which for many of them is the only export product.

OPEC appeared in 1960, when the colonial system of the world was collapsing and new independent states, mainly African or Asian, began to appear on the international scene. At that time, their mineral resources were mined, among other things, by Western companies, the so-called "seven sisters" Exxon, Royal Dutch Shell, Texaco, Chevron, Mobil, Gulf Oil and British Petroleum , who, of course, received the main profits in this process.

The first states that formed OPEC were Iran, Iraq, Kuwait, Saudi Arabia and Venezuela - decided to control the production and sale of oil themselves. The business turned out to be profitable and soon the five founders were joined by Qatar (1961), Indonesia and Libya (1962), United United Arab Emirates(1967), Algeria (1969). In 1971, 1973 and 1975, Nigeria, Ecuador, and Gabon were added to OPEC members.

OPEC currently consists of 12 countries

  • Algeria
  • Angola
  • Venezuela
  • Qatar
  • Kuwait
  • Libya
  • Nigeria
  • Saudi Arabia
  • Ecuador

OPEC countries control the production of 30 to 40% of world oil

At the same time, Brunei, Great Britain, Indonesia, Mexico, Norway, Oman, and Russia - also not the last countries in the oil production industry - are not included in OPEC.

- OPEC headquarters is located in Vienna
- The highest body is the conference of participating countries, convened every two years
- The price of oil is determined as the arithmetic average of the prices of 12 types produced in the participating countries. This is the so-called "OPEC basket". The types of oil included in it change periodically
- OPEC quotas - regulation and limitation of oil production and export for different countries organizations.

The last quota decision was made in November 2014: the Organization of Petroleum Exporting Countries decided not to reduce production and maintained its official maximum level of 30 million barrels per day, which caused a sharp drop in world prices from 100-90 dollars to 50-60 dollars per day. barrel

Barrel (English barrel - barrel) - a unit of volume. Equal to 42 gallons or 158.988 liters

The Organization of the Petroleum Exporting Countries, founded in 1960 by a number of countries (Algeria, Ecuador, Indonesia, Iraq, Iran, Kuwait, Libya, Nigeria, Saudi Arabia, the United Arab Emirates and Venezuela) with the aim of coordinating the volume of sales and setting prices for crude oil. oil.

Due to the fact that OPEC controls approximately half of the world's oil trade, it is able to significantly influence the level of world prices. The oil cartel, which was registered with the UN as a full-fledged intergovernmental organization in 1962, accounts for about 40% of world oil production.

Brief economic characteristics of OPEC member states (in 2005)

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Algeria Indonesia Iran Iraq Kuwait Libya Nigeria Qatar Saudi Arabia UAE Venezuela
Population (thousand people) 32,906 217,99 68,6 28,832 2,76 5,853 131,759 824 23,956 4,5 26,756
Area (thousand km 2) 2,382 1,904 1,648 438 18 1,76 924 11 2,15 84 916
Population density (persons per km 2) 14 114 42 66 153 3 143 75 11 54 29
GDP per capita ($) 3,113 1,29 2,863 1,063 27,028 6,618 752 45,937 12,931 29,367 5,24
GDP at market prices (millions of $) 102,439 281,16 196,409 30,647 74,598 38,735 99,147 37,852 309,772 132,15 140,192
Export volume (million $) 45,631 86,179 60,012 24,027 45,011 28,7 47,928 24,386 174,635 111,116 55,487
Oil export volume (million $) 32,882 9,248 48,286 23,4 42,583 28,324 46,77 18,634 164,71 49,7 48,059
Current balance ($ million) 17,615 2,996 13,268 -6,505 32,627 10,726 25,573 7,063 87,132 18,54 25,359
Proven oil reserves (million barrels) 12,27 4,301 136,27 115 101,5 41,464 36,22 15,207 264,211 97,8 80,012
Proven reserves natural gas(billion cubic meters) 4,58 2,769 27,58 3,17 1,557 1,491 5,152 25,783 6,9 6,06 4,315
Crude oil production volume (1,000 bbl/day) 1,352 1,059 4,092 1,913 2,573 1,693 2,366 766 9,353 2,378 3,128
Natural gas production volume (million cubic meters/day) 89,235 76 94,55 2,65 12,2 11,7 21,8 43,5 71,24 46,6 28,9
Oil refining capacity (1,000 bbl/day) 462 1,057 1,474 603 936 380 445 80 2,091 466 1,054
Petroleum products production (1,000 bbl/day) 452 1,054 1,44 477 911 460 388 119 1,974 442 1,198
Consumption of petroleum products (1,000 bbl/day) 246 1,14 1,512 514 249 243 253 60 1,227 204 506
Crude oil export volume (1,000 bbl/day) 970 374 2,395 1,472 1,65 1,306 2,326 677 7,209 2,195 2,198
Petroleum products export volume (1,000 bbl/day) 464 142 402 14 614 163 49 77 1,385 509 609
Volume of natural gas exports (million cubic meters) 64,266 36,6 4,735 -- -- 5,4 12 27,6 7,499 --

Main goals of OPEC

The main goals of creating the Organization are:

  • Coordination and unification of the oil policies of the member states.
  • Determining the most effective individual and collective means of protecting their interests.
  • Ensuring price stability on world oil markets.
  • Attention to the interests of oil-producing countries and the need to ensure: sustainable income for oil-producing countries; efficient, cost-effective and regular supply of consumer countries; fair returns from investments in the oil industry; security environment in the interests of present and future generations.
  • cooperation with non-OPEC countries in order to implement initiatives to stabilize the global oil market.

Only founding members and those countries whose applications for admission have been approved by the conference can be full members. Any other country that exports crude oil on a significant scale and has interests fundamentally similar to those of the member countries may become a full member, provided that its admission is approved by a 3/4 majority, including the votes of all founding members.

Organizational structure of OPEC

The highest body of OPEC is the Conference of Ministers of the states that are members of the organization; there is also a Board of Directors, in which each country is represented by one delegate. As a rule, it attracts the closest attention not only from the press, but also from key players in the global oil market. The conference determines the main directions of OPEC's policies, ways and means of their practical implementation and makes decisions on reports and recommendations submitted by the Board of Governors, as well as on the budget. It instructs the Council to prepare reports and recommendations on any issues of interest to the organization. The Conference is formed by the Board of Governors itself (one representative per country, as a rule, these are the ministers of oil, extractive industries or energy). She also elects the president and appoints the general secretary of the organization.

The Secretariat carries out its functions under the guidance of the Board of Governors. Secretary General is the highest official Organization, OPEC Plenipotentiary Representative and Head of the Secretariat. He organizes and directs the work of the Organization. The structure of the OPEC secretariat includes three departments.

The OPEC Economic Commission is dedicated to promoting stability in international oil markets at fair price levels so that oil can maintain its importance as the primary global energy source in accordance with OPEC's objectives, closely monitoring changes in energy markets and keeping the Conference informed of these changes .

History of the development and activities of OPEC

OPEC's mission since the 1960s has been to present a unified position for oil-producing countries in order to limit the influence of the largest oil companies on the market. However, in reality OPEC in the period from 1960 to 1973. could not change the balance of power in the oil market. Significant adjustments to the balance of power were made by the war that suddenly began in October 1973 between Egypt and Syria, on the one hand, and Israel, on the other. With the support of the United States, Israel managed to quickly regain the lost territories and already in November sign ceasefire agreements with Syria and Egypt.

October 17, 1973 OPEC opposed US policy by imposing an embargo on oil supplies to this country and increasing selling prices for the United States' Western European allies by 70%. Overnight, a barrel of oil rose in price from $3 to $5.11. (In January 1974, OPEC raised the price per barrel to $11.65). The embargo was introduced at a time when about 85% of American citizens were already accustomed to driving their own car to work. Although President Nixon introduced strict restrictive measures on the use of energy resources, the situation could not be saved, and a period of economic recession began for Western countries. At the peak of the crisis, the price of a gallon of gasoline in the United States rose from 30 cents to $1.2.

Wall Street's reaction was immediate. Naturally, in the wake of super profits, shares of oil producing companies went up, but all other shares in the period from October 17 to the end of November 1973 lost an average of 15%. During this time, the Dow Jones index fell from 962 to 822 points. In March 1974, the embargo against the United States was lifted, but the effect it had had could not be smoothed out. In the two years from January 11, 1973 to December 6, 1974, the Dow fell nearly 45%, from 1,051 to 577.

Oil revenues for major Arab oil-producing countries, 1973-1978. grew at an unprecedented pace. For example, the income of Saudi Arabia increased from $4.35 billion to $36 billion, Kuwait - from $1.7 billion to $9.2 billion, Iraq - from $1.8 billion to $23.6 billion.

In the wake of high oil revenues in 1976, OPEC created the Fund international development OPEC is a multilateral development financial institution. Its headquarters are also located in Vienna. The Fund is designed to promote cooperation between OPEC member states and other developing countries. International institutions whose activities benefit developing countries and all non-OPEC developing countries can benefit from the fund. The OPEC Fund provides loans (on preferential terms) of three types: for projects, programs and balance of payments support. Resources consist of voluntary contributions from member states and profits generated through the fund's investment and lending operations.

However, by the end of the 70s, oil consumption began to decline for a variety of reasons. Firstly, the activity of non-OPEC countries has increased in the oil market. Secondly, a general decline in the economies of Western countries began to appear. Third, efforts to reduce energy consumption have borne some fruit. In addition, the United States, concerned about possible shocks in oil-producing countries, the high activity of the USSR in the region, especially after the introduction Soviet troops to Afghanistan, were ready to use military force. Eventually, oil prices began to decline.

Despite all Taken measures, in 1978 the second oil crisis broke out. The main reasons were the revolution in Iran and the political resonance that the Camp David agreements caused between Israel and Egypt. By 1981, the price of oil reached $40 per barrel.

The weakness of OPEC was fully revealed in the early 1980s, when, as a result of the full-scale development of new oil fields outside OPEC countries, the widespread introduction of energy-saving technologies and economic stagnation, the demand for imported oil in the industrial developed countries sharply decreased, and prices fell by almost half. After this, the oil market experienced calm and a gradual decline in oil prices for 5 years. However, when in December 1985 OPEC sharply increased oil production to 18 million barrels per day, a real price war began, provoked by Saudi Arabia. Its result was that within a few months, crude oil fell in price by more than half - from 27 to 12 dollars per barrel.

The fourth oil crisis occurred in 1990. On August 2, Iraq attacked Kuwait, prices jumped from $19 per barrel in July to $36 in October. However, then oil prices fell to its previous level even before the start of Operation Desert Storm, which ended with the military defeat of Iraq and the economic blockade of the country. Despite persistent oil overproduction in most OPEC countries and increased competition from other oil-producing countries, oil prices remained relatively stable throughout the 1990s compared to the fluctuations they experienced in the 1980s.

However, at the end of 1997, oil prices began to fall, and in 1998, the world oil market was gripped by an unprecedented crisis. Analysts and experts cite many different reasons for this sharp drop in oil prices. Many are inclined to place all the blame on OPEC's decision, made at the end of November 1997 in Jakarta (Indonesia), to increase the ceiling on oil production, as a result of which additional volumes of oil were allegedly released onto the markets and a decrease in prices occurred. The efforts made by OPEC and non-OPEC countries in 1998 undoubtedly played a critical role in preventing a further collapse of the global oil market. Without the measures taken, the price of oil, according to some experts, could have fallen to 6-7 dollars per barrel.

Development problems of OPEC countries

One of the main disadvantages of OPEC is that it brings together countries whose interests are often opposed. Saudi Arabia and other countries on the Arabian Peninsula are sparsely populated but have vast oil reserves, large foreign investments and very close relationships with Western oil companies.

Other OPEC countries, such as Nigeria, have high populations and poverty, have expensive economic development programs, and are heavily indebted.

The second seemingly simple problem is the banal “where to put the money.” After all, it is not always easy to properly manage the shower of petrodollars pouring into the country. Monarchs and rulers of countries that were overwhelmed by wealth sought to use it “for the glory of own people“and therefore they started various “construction projects of the century” and other similar projects, which cannot in any way be called a reasonable investment of capital. Only later, when the euphoria from the first happiness had passed, when the ardor had cooled a little due to the fall in oil prices and the decline in government revenues, did the state budget begin to be spent more wisely and competently.

Third, main problem is compensation for the technological backwardness of the OPEC countries from the leading countries of the world. After all, by the time the organization was created, some of the countries that were part of it had not yet gotten rid of the remnants of the feudal system! The solution to this problem could be accelerated industrialization and urbanization. The introduction of new technologies into production and, accordingly, people’s lives did not pass without leaving a mark on the people. The main stages of industrialization were the nationalization of some foreign companies, for example ARAMCO in Saudi Arabia, and the active attraction of private capital into industry. This was done through comprehensive state aid the private sector of the economy. For example, in Arabia, 6 special banks and funds were created that provided assistance to entrepreneurs under state guarantees.

The fourth problem is the insufficient qualifications of national personnel. The fact is that workers in the state were unprepared for the introduction of new technologies and were unable to maintain modern machines and equipment that were supplied to oil production and processing enterprises, as well as other factories and enterprises. The solution to this problem was to attract foreign specialists. It wasn't as easy as it seems. Because this soon gave rise to a lot of contradictions, which intensified with the development of society.

Thus, all eleven countries are deeply dependent on the income of their oil industry. Perhaps the only exception among OPEC countries is Indonesia, which receives significant income from tourism, timber, gas and other raw materials. For the remaining OPEC countries, the level of dependence on oil exports ranges from a low of 48% in the case of the United Arab Emirates to 97% in Nigeria.

The implementation of international commodity agreements regulating activities in certain market segments is carried out by International Commodity Organizations (ICOs) in the form of:

  • International organizations;
  • International Councils;
  • International Advisory Committees;
  • International Research Groups (IRGs).

All of these institutes are engaged in studying the state of world commodity markets, namely: the current relationship between supply and demand for specific raw materials, the dynamics of prices and conditions.

Currently there are International Councils for olive oil, tin, grain.

MIGs apply to rubber, lead and zinc, and copper.

There is an International Cotton Advisory Committee and a Tungsten Committee.

Iran has the second largest oil reserves after Saudi Arabia (18 billion tons) and occupies 5.5% of the global oil products trading market. Particular attention is paid to economic diversification through the development of precision engineering, automotive engineering, the rocket and space industry, and information technology.

A major oil exporter is Kuwait. Oil production provides 50% of Kuwait's GDP, its share in the country's exports is 90%. The country also has developed oil refining and petrochemicals, the production of building materials, fertilizers, the food industry, and pearl mining. Desalination in progress sea ​​water. Fertilizers constitute an important part of the country's exports.

Iraq has the second largest oil reserves in the world. Iraqi state companies North Oil Company and South Oil Company have a monopoly on the development of local oil fields. Iraq's southern fields, managed by SOC, produce about 1.8 million barrels of oil per day, accounting for almost 90% of all oil produced in Iraq.

Thus, Most OPEC countries are deeply dependent on the income of their oil industry. Perhaps the only exception among the member countries of the organization is Indonesia, which receives significant income from tourism, timber, gas and other raw materials. For the remaining OPEC countries, the level of dependence on oil exports ranges from a low of 48% in the case of the United Arab Emirates to 97% in Nigeria.

During a crisis, the strategic path for countries dependent on oil exports is to diversify their economies through the development of the latest resource-saving technologies.

The abbreviation OPEC stands for "Association of Petroleum Exporting Countries". The main goal organization was to regulate prices for black gold on the world market. The need to create such an organization was obvious.

In the middle of the 20th century, oil prices began to fall due to market glut. The Middle East sold the most oil. It was there that the richest deposits of black gold were discovered.

In order to pursue a policy to maintain oil prices on a global scale, it was necessary to force oil-producing countries to reduce the rate of its production. This was the only way to remove excess hydrocarbons from the world market and raise prices. OPEC was created to solve this problem.

List of countries that are members of OPEC

Today, 14 countries take part in the organization’s work. Consultations between representatives of the organization are held twice a year at OPEC headquarters in Vienna. At such meetings, decisions are made to increase or decrease oil production quotas for individual countries or the entire OPEC.

Venezuela is considered the founder of OPEC, although this country is not a leader in oil production. The palm in terms of volumes belongs to Saudi Arabia, followed by Iran and Iraq.

In total, OPEC controls about half of the world's black gold exports. In almost all member countries of the organization, the oil industry is the leading industry in the economy. Therefore, the decline in world oil prices causes swipe by income of OPEC members.

List of African countries included in OPEC

Of the 54 African states, only 6 are members of OPEC:

  • Gabon;
  • Equatorial Guinea;
  • Angola;
  • Libya;
  • Nigeria;
  • Algeria.

Most of the “African” OPEC participants joined the organization in the 1960-1970s. At that time many African states freed from colonial rule European countries and gained independence. The economy of these countries was focused mainly on the extraction of minerals and their subsequent export abroad.

African countries are characterized by high populations but also high rates of poverty. To cover the costs of social programs, the governments of these countries are forced to produce a lot of crude oil.

In order to withstand competition from European and American oil-producing transnational corporations, African countries joined OPEC.

Asian countries included in OPEC

Political instability in the Middle East predetermined the entry of Iran, Saudi Arabia, Kuwait, Iraq, Qatar, and the United Arab Emirates. The organization's Asian member countries are characterized by low population density and huge foreign investment.

Oil revenues are so enormous that Iran and Iraq paid for their military expenses in the 1980s by selling oil. Moreover, these countries fought against each other.

Today, political instability in the Middle East threatens not only the region itself, but also threatens world oil prices. It's going on in Iraq and Libya Civil War. The lifting of sanctions from Iran threatens to increase oil production in this country, despite the obvious exceeding of the OPEC oil production quota.

Latin American countries that are members of OPEC

Only two countries Latin America included in OPEC are Venezuela and Ecuador. Despite the fact that Venezuela is the country that initiated the founding of OPEC, the state itself is politically unstable.

Recently (in 2017), a wave of anti-government protests swept across Venezuela related to the ill-conceived economic policy government. Behind Lately The country's public debt has increased significantly. For some time, the country kept afloat due to high oil prices. But as prices fell, the Venezuelan economy also collapsed.

Non-OPEC oil exporting countries

Recently, OPEC has lost its leverage over its members. This situation is largely due to the fact that several oil importing countries that are not members of OPEC have appeared on the world market.

First of all this:

  • Russia;
  • China;

Despite the fact that Russia is not a member of OPEC, it is a permanent observer in the organization. An increase in oil production by non-OPEC countries leads to a decrease in the price of oil on the world market.

However, OPEC cannot influence them, since even members of the organization do not always comply with agreements and exceed permissible quotas.

Many companies and specialist representatives from OPEC member countries come to the rather large Neftegaz exhibition held in Moscow.

O PEC translated from English is the organization of oil exporting countries. The purpose of creating OPEC was and is to control oil production quotas and prices. OPEC was created in September 1960 in Baghdad. The list of members changes periodically during the existence of the organization and as of 2018 (July) it includes 14 countries.

The initiators of the creation were 5 countries: Iran, Iraq, Kuwait, Saudi Arabia and Venezuela. These countries were later joined by Qatar (1961), Indonesia (1962), Libya (1962), United Arab Emirates (1967), Algeria (1969), Nigeria (1971), Ecuador (1973), Gabon (1975) year), Angola (2007) and Equatorial Guinea (2017).

As of today (February 2018), OPEC includes 14 countries:

  1. Algeria
  2. Angola
  3. Venezuela
  4. Gabon
  5. Kuwait
  6. Qatar
  7. Libya
  8. United Arab Emirates
  9. Nigeria
  10. Saudi Arabia
  11. Equatorial Guinea
  12. Ecuador

Russia is not a member of OPEC.

Countries included in the organization control 40% of all oil production on earth, that’s 2/3. The leader in oil production in the world is Russia, but it is not part of OPEC and cannot control the price of oil. Russia is an energy-dependent country.

The level of economic development and well-being of Russians depends on its sale. Therefore, in order not to depend on oil prices on the world market, Russia should develop other sectors of the economy.

So, several times a year the ministers of OPEC countries gather for meetings. They assess the state of the world oil market and predict the price. Depending on this, decisions are made to reduce or increase oil production.

We constantly see the abbreviation "OPEC" in the news, and it is not surprising - after all, this organization today provides significant influence on the formation of world prices for “black gold”. OPEC is the Organization of the Petroleum Exporting Countries (OPEC, The Organization of the Petroleum Exporting Countries), created in 1960. Its headquarters were originally located in Geneva, but were moved to Vienna in 1965.

By the time OPEC was founded, there was a significant surplus of oil on the market, the emergence of which was caused by the beginning of the development of giant oil fields - primarily in the Middle East. In addition, the market entered Soviet Union, where oil production doubled from 1955 to 1960. This abundance has caused severe competition in the market, leading to a constant decline in prices. The current situation was the reason for the unification of several oil exporting countries into OPEC in order to jointly resist transnational oil corporations and maintain the required price level.

Initially, the organization included Iran, Iraq, Saudi Arabia and Venezuela. They were then joined by Qatar, Indonesia, Libya, the United Arab Emirates, Algeria, Nigeria, Ecuador, Gabon and Angola. Ecuador left OPEC in 1992 but returned in 2007. Gabon left the organization in 1994. As a result, today there are 13 countries in OPEC.

The organization officially sets itself the following main goals:

protect the interests of the organization’s member countries; guarantee stability of prices for oil and petroleum products; ensure regular supplies of oil to other countries; guarantee to member countries of the organization stable income from oil sales; determine strategies for oil production and sales.

In the first years of its existence, OPEC was unable to achieve its goals. But this changed in 1973, when Egyptian and Syrian troops attacked Israeli positions. In this war, called Yom Kippur, the Western world supported the Israeli side. In response, OPEC announced the first embargo limiting oil exports to countries Western Europe and the United States, which caused the first oil crisis in world history. In just six months, by the beginning of 1974, oil prices jumped by 130% and reached $7 per barrel, and by the end of 1979 they were already $18 per barrel. The crisis strengthened the organization’s position so much that the mid-70s became the “golden age” of OPEC. However, the West began to establish closer ties with the USSR, which was actively increasing oil supplies. In addition, international oil companies turned their attention to other important oil areas such as the North Sea and the Gulf of Mexico. The embargo also contributed to the start of development of the giant Prudhoe Bay field in Alaska, with initial oil reserves exceeding 1.3 billion tons (9.5 billion barrels).

Gradually, OPEC's position was weakened.

During the 1980s, the price of oil fell steadily. If in 1981 it reached $40 per barrel, then five years later its level approached $10 per barrel. Iraqi President Saddam Hussein called on OPEC to raise the selling price, which became the reason for the war in Persian Gulf in 1990-1991. The Iraqi invasion of Kuwait and the ensuing Persian crisis deprived OPEC of unity and affected oil prices, which rose to $30 per barrel. As soon as the fear of oil shortages caused by these military conflicts dissipated, prices plummeted downward. In 1998, OPEC countries lifted all restrictions on production and exports, which immediately affected the markets - prices again dropped below $10 per barrel.

To solve the problem, it was proposed to reduce the production of “black gold” - this initiative is attributed to Venezuelan President Hugo Chavez. In 2000, Chavez convened a summit of OPEC heads of state for the first time in 25 years. However, the terrorist attacks of September 11, 2001 in the United States, as well as the invasions of Afghanistan and Iraq, caused a sharp rise in oil prices, which allowed them to far exceed the levels that OPEC members wanted to achieve.

OPEC energy and oil ministers meet twice a year to assess the state of the international oil market, decide on necessary actions to stabilize the market, and make forecasts for the future. Production volumes, which change in accordance with market demand dynamics, are adopted at OPEC conferences.

Today, the organization's members control approximately two-thirds of the planet's proven oil reserves. OPEC provides 40% of world production and half of world exports of this precious raw material. The organization coordinates oil production policy and world crude oil pricing, and also sets quotas for oil production volumes. And despite the popular belief that OPEC’s time has passed, it still remains one of the most influential global players in the oil industry, determining its further development.

OPEC is an organization of oil exporting countries (from the English OPEC, The Organization of the Petroleum Exporting Countries).

This structure is an international intergovernmental organization. It was created by states in which oil is produced in order to stabilize the price of oil. The organization includes states whose economies depend on profits from the export of “black gold”.

Creation of OPEC

To fight oil monopolies, developing countries that export oil decided that they needed to join forces and begin an active struggle. Thus, in 1960, in Baghdad, the main exporters of liquid fuels on the world market - Venezuela, Iraq, Iran, Kuwait and Saudi Arabia - became the founders of the Organization of Petroleum Exporting Countries (OPEC). OPEC registered with the United Nations on September 6, 1962 under UN Resolution No. 6363.
The formation of OPEC became possible thanks to the idea of ​​Venezuela, which at that time was the most developed of all oil-producing states. And it was in this country that oil monopolies were exploited for a long time. Awareness of the urgent need to coordinate efforts against oil monopolies also arose in the Middle East. This is evidenced by the Iraqi-Saudi agreement on the coordination of Oil Policy, which was signed in 1953, as well as the meeting of the Arab League in 1959, which was devoted to oil problems. Representatives from Venezuela also attended this meeting.
The first charter was approved at the 2nd conference in Caracas on January 15-21, 1961. However, four years later the charter was completely revised. But even after this, numerous changes and additions were often made to the charter. Today, OPEC accounts for approximately 40% of global oil production. The first OPEC headquarters was located in Geneva (Switzerland), but later moved to Vienna (Austria).
Another impetus for the formation of the oil exporters' association was another drop in reference prices in 1959 by the International Petroleum Cartel, as well as the establishment of restrictions on oil imports into the United States.
Today, the OPEC organization consists of 14 countries: Algeria (since 1969), Indonesia (since 1962), Iraq (since 1960), Iran (since 1960), Kuwait (since 1960), Lebanon ( since 1962), Nigeria (since 1971), Qatar (since 1961), Saudi Arabia (since 1960), Angola, United Arab Emirates (since 1967) and Venezuela (since 1960) , Equatorial Guinea. Previously, Gabon and Ecuador belonged to OPEC, but they decided to end their membership in this organization. People often think that Russia is also a member of OPEC, but this is not true. Russia is not on the list of member states of the organization, but is required to attend all meetings of the organization.
Any state that exports a lot of oil and adheres to the same ideals that the organization follows can become a member of OPEC.

Why was OPEC created?

The main goals of creating such an organization include:

  • coordination and unification of the oil policies of countries that are members of the organization
  • identifying the most effective individual and collective methods of protecting the interests of such countries
  • guarantee of a stable price for black gold on the global oil market
  • stable incomes of oil producing states
  • efficient, cost-effective and regular supply of consumer countries
  • fair returns from investments in the oil industry
  • environmental protection in the interests of living and future generations.

Organization structure

The Organization of Petroleum Exporting Countries has as the cartel's main governing body the Conference of Participating Countries, convened twice a year. The conference addresses the following issues:

  • admission of new members
  • formation of the composition of the Board of Governors
  • budget volume and financial reporting
  • elections of the Chairman of the Board of Governors, the Secretary General, as well as his deputies and auditor.

The Board of Governors develops issues for the Conference, manages the activities of the Secretariat, which is a permanent operating body. The Secretariat monitors and draws up initiatives for the Board of Governors and the Conference, monitors the implementation of approved resolutions, and draws up draft annual OPEC budgets.

In the early 80s, oil futures were introduced, as a result of which the financial market began to exert enormous pressure on the formation of the price of oil. It is worth noting that in 1983, oil futures positions for 1 billion barrels of oil appeared on the New York Mercantile Exchange, and in 2011 their number reached 365 billion barrels, which is 12 times the volume of global oil production in 2010.
OPEC members, in the process of adopting any resolutions on changing oil production quotas to adjust world prices, in reality only determine the desired direction for the movement of world prices. Participants in financial markets, especially “speculators,” provide active assistance and also use fluctuations in the price of oil for their own purposes, thereby significantly distorting the effect at which OPEC’s measures are aimed.

Russia and OPEC

In 1998, Russia became an observer in OPEC.

Since this year, Russian representatives have been taking part in sessions of the OPEC Conference. Besides Russian experts attend meetings of specialists and other events of the organization together with representatives of states that are not members of it. Frequent meetings of Russian ministers are held with the leadership of OPEC and partners from OPEC countries.
Russia is the initiator of organizing a regular Russia-OPEC Energy Dialogue and signing an Agreement (Memorandum) on the Energy Dialogue. The authorized representative from Russia in this event is the Ministry of Energy of the Russian Federation.
Experts note Russia's significant influence on the organization's policies. As a result of fears that Russia will increase its volume in the market, OPEC does not want to reduce production unless Russia reduces it too. This situation is the main obstacle to the restoration of global oil prices. Two years ago, Russia was offered to become a member of OPEC, but refused.

oil production, OPEC, oil exports, oil exporters, oil cost, oil prices, OPEC

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