OPEC: A Brief History Overview

<p>Saudi Arabia (C)</p> Signup and view all the answers

<p>Military conflicts and infrastructure attacks (B)</p> Signup and view all the answers

<p>To stabilize the world oil market and ensure fair prices (D)</p> Signup and view all the answers

<p>Saudi Arabia, Venezuela, Iran, Iraq, and Kuwait (A)</p> Signup and view all the answers

<p>Increasing production from the Soviet Union and falling oil prices (A)</p> Signup and view all the answers

<p>Export limits and the desire for increased oil production (D)</p> Signup and view all the answers

<p>The Six-Day War (C)</p> Signup and view all the answers

<p>Iran and Venezuela did not agree to the boycott (D)</p> Signup and view all the answers

<p>The right of nations to control their natural resources (C)</p> Signup and view all the answers

<p>The Seven Sisters oil companies (B)</p> Signup and view all the answers

<p>The Yom-Kippur War (C)</p> Signup and view all the answers

<p>56% (D)</p> Signup and view all the answers

<p>Oil shortage and price increase (A)</p> Signup and view all the answers

<p>Indonesia and Libya (A)</p> Signup and view all the answers

<p>They increased supply from other members (C)</p> Signup and view all the answers

<p>Scarcity fears regarding crude oil (C)</p> Signup and view all the answers

<p>Loss of Iranian oil supply (B)</p> Signup and view all the answers

<p>USSR (A)</p> Signup and view all the answers

<p>Impose a production quota (A)</p> Signup and view all the answers

<p>Constant technological advancements (B)</p> Signup and view all the answers

<p>Increased nearly 40% (A)</p> Signup and view all the answers

<p>It empowered OPEC nations to influence powerful countries (A)</p> Signup and view all the answers

<p>Increased transport costs (D)</p> Signup and view all the answers

OPEC, or the Organization of Petroleum Exporting Countries, was formed in 1960 to stabilize the global oil market and ensure fair prices for member nations.

The major oil companies (Esso, Mobil, Standard, Gulf, Texaco, BP, and CFP) dominating the oil market in the 1950s.

The Soviet Union's increased oil production forced Seven Sister companies to lower their oil prices in order to compete.

To coordinate energy policies to stabilize the oil market and ensure fair prices for member countries' oil.

Differing interests made cooperation in the oil industry difficult and caused conflict over export limits among members.

A short military conflict between Israel, and some Arab countries, which led to discussions about an oil boycott.

A proposed oil boycott against Israel failed due to disagreement among OPEC members.

OPEC declared its members' right to control their oil resources for national enrichment, as a statement of policy.

In 1990, Iraq invaded Kuwait, another OPEC member, seeking to revise oil quotas and increase its oil exports for revenue after the Iran-Iraq War.

Ecuador and Gabon temporarily left OPEC (1992-2007 and 1995-2016 respectively) to increase their oil production, seeking more freedom from cartel regulations.

The 2003 US-led invasion of Iraq caused a short-term drop in oil supply, but Saudi Arabia's increased production quickly filled the gap.

The insurgency following the 2003 invasion of Iraq kept Iraqi oil production low, while oil prices surged, causing global market instability.

Ongoing conflicts in OPEC member nations, like Libya, Nigeria, and Iraq/Syria, periodically disrupt global oil supply, contributing to price fluctuations.

OPEC (Organization of the Petroleum Exporting Countries) controlled a significant portion of the global oil market, holding 56% in 1973.

The US intervention in the Yom Kippur War led to an OPEC oil embargo against the US, Canada, UK, Japan, and Netherlands.

A coordinated refusal by OPEC member states to sell oil to certain countries, impacting global oil supply.

The OPEC embargo, coupled with global political events and a shift in supply lines, created a shortage and resulted in a sharp increase in oil prices.

Despite significant influence, OPEC did not have a complete monopoly on oil supply in 1973, their market share was 56% not 100%.

National governments working together with oil companies to manipulate global oil supply and price, attempting to reduce their reliance on Western companies for refinement and sales.

Increased oil production from outside OPEC by 1980s, along with alternative energy sources, reduced OPEC's control over the market.

OPEC attempted to raise prices by limiting oil production (quotas).

OPEC's inability to agree on quotas, coupled with increased global oil production, led to an oversupply and a sharp decline in oil prices in 1986.

The 1979 Iranian Revolution and the subsequent Iran-Iraq war disrupted oil supply and influenced oil prices.

The collapse of the Soviet Union and increased production elsewhere in the world further challenged OPEC's control over oil markets.

OPEC members often lack the infrastructure (refineries, marketing networks) required to process and sell their oil.

The 1970s oil crisis drove research and development in alternatives to oil such as coal, nuclear and natural gas.

The Soviet Union had become a major oil producer by 1980, further impacting OPEC's market share.

Although OPEC had significant influence, its ability to control oil prices was limited by the availability of alternative sources and other producers.