OPEC, otherwise known as the Organization of the Petroleum Exporting Countries, is an organisation of worldwide renown. Fourteen of the most important oil-exporters are currently members. The organisation coordinates the petroleum policies in all its member states. The first five members found the company in 1960, with the intention of permanent presence. These countries consist of Venezuela, Kuwait, Iraq, Saudi Arabia, and Iran. The current headquarters of the organisation is located in Austria’s capital, Vienna.
We can disclose some of OPEC’s main goals accordingly. The first we could mention is their aim to guarantee prices which are both fair and will remain stable. They also aim to ensure petroleum supplies are constant and remain economical. The organisation is also an ally to investors, as it regulates payment of dividends to investors by their invested oil-based companies.
The founding of the company in 1960 was a result of the process of decolonisatio. These new countries who had gained, with their newly founded independence, were now able to coordinate with one another.
They then founded their Secretariat (administrative division) in Geneva in 1965, after which they moved it to Austria. By 1965, their numbers had risen to ten member countries. This trend of growth continued, and by the 1970s the organisation had become world-famous. Around this time, many of the members nationalised their oil industries, ensuring total control over them. This meant they had total dominance of the oil industry.
OPEC’s first summit of their countries leaders took place in Algiers in 1975. Here, OPEC decided to spread its influence to help develop the industries of more impoverished countries. This was closely followed by an increase in their numbers to 13 members in the very same year. In the following year the company enacted a Fund for International Development.
In the aftermath of the first Gulf War of the 1990s, it was OPEC which found itself sustaining oil prices to ensure the industry continued to thrive. Their efforts were successful, and oil prices rose at a much slower rate than in previous decades.
In the 21st century, OPEC introduced an oil price band mechanism to further ensure oil price stabilisation. By 2008, oil prices reached record highs, but the financial crisis had a devastating effect on them and volatility followed.
Following this, major political events like the Arab spring put further strain on the vitality of the industry. Overcoming oncoming problems, such as climate change and the ensuing regulations, is vital for the future of the industry.