The Impact and Influence of OPEC on Global Trade Essay examples

The Impact and Influence of OPEC on Global Trade Essay examples

Length: 908 words (2.6 double-spaced pages)

Rating: Better Essays

Open Document

Essay Preview

The selected key concept of the week is OPEC: the Organization of the Petroleum Exporting Countries was formed on September 14, 1960 in Baghdad, Iraq and registered with the United Nations Secretariat on November 6, 1962 ( Organization of the Petroleum Exporting Countries, 2013). OPEC defines themselves as “a permanent intergovernmental organization, currently consisting of 12 oil producing and exporting countries, spread across three continents America, Asia and Africa ( Organization of the Petroleum Exporting Countries, 2013, p. 1). I am specifically interested in exploring the influence of OPEC on global trade and economies.
Key Term
The formation of OPEC in the 1960’s was motivated by complex, inter-dependent factors including the end of British colonization, the surge in the demand for oil based energy, and a desire for the member nations to benefit from – and control - the market price of “the most valuable commodity in the history of the world” (Myers & Lyford, N.D., p. 1): crude oil. Today, OPEC purports to have three primary objectives:
1. To co-ordinate and unify the petroleum policies of the Member Countries and to determine the best means for safeguarding their individual and collective interests;
2. To seek ways and means of ensuring the stabilization of prices in international oil markets, with a view to eliminating harmful and unnecessary fluctuations; and
3. To provide an efficient economic and regular supply of petroleum to consuming nations and a fair return on capital to those investing in the petroleum industry ( Organization of the Petroleum Exporting Countries, 2013).

Major Article Summary
In January 1975, the Journal of Business published a very interesting article titled “The Future of OPEC” in which th...

... middle of paper ...

...ries. (2013, November 14). About OPEC. Retrieved from Organization of the Petroleum Exporting Countries:
Cairnsa, R. D., & Calfucura, E. (2012). OPEC: Market failure or power failure? Energy Policy, 50, 570-580. doi:
Dorraj, M. (1993). Will OPEC Survive? Arab Studies Quarterly, 19-33.
Dunstan, S. (2007). The Yom Kippur War: The Arab-Israeli War of 1973. New York: Osprey Publishing.
International Energy Agency. (2008). World Energy Outlook. Paris: IEA.
Mancke, R. (1975). The Future of OPEC. Journal of Business, 11-19.
Myers, J., & Lyford, M. (N.D.). Petroleum and Peak Oil. (pp. 1-109). University of Wyoming. Retrieved from
Satterlee, B. (2009). Cross Border Commerce. Roanoke: Synergistics Inc. .

Need Writing Help?

Get feedback on grammar, clarity, concision and logic instantly.

Check your paper »

Essay about Oil Crisis in Libya

- Because of the crisis that is going on in Libya, Libya’s oil production and exportation has been greatly affected. This country is a member of OPEC, Organization of the Petroleum Exporting Countries. Libya is the world’s seventeen largest oil producer, the thirds largest oil producer in Africa, and the continent’s largest crude oil reserves. (Hauser, 2011) Since Libya has such an important part in the oil industry, the crisis has affected other countries and their trade, such as the price of oil and gas, as well as monetary value....   [tags: OPEC, Middle East]

Free Essays
608 words (1.7 pages)

Essay on The Impact of Globalization

- Since World War II, globalization has partially been the result of politicians colluding to break down borders, which limited trade and investments. The efforts of those politicians brought about the Bretton Woods conference, an accord between world leaders to establish a structure for international trade and investment. Globalization was also a result of the global expansion of international corporations based in the United States and Europe, as well as the international spread of developments in science, products and inventions, with most of the major inventions of the twentieth century having western origins according to the Encyclopedia Britannica....   [tags: Outsourcing, Offshoring, Free Trade]

Better Essays
704 words (2 pages)

Causes of Rising Global Oil Prices Essay

- Among the factors that often blamed the current price increases embrace the renewed geopolitical concerns in the Middle East, declining excess capacity in oil production, the production cuts agreed by the Organization of Petroleum Exporting Countries, the devaluation of U.S. dollar against other most important currencies, increased demand from rising countries and the noteworthy expansion in provisional dealings on oil futures market. Traders and speculators can earn from these changes in values through purchasing or selling Crude Oil CFD's (Kanter, 2008)....   [tags: Economics ]

Better Essays
950 words (2.7 pages)

Essay about Causes of Rising Global Oil Prices

- Causes of rising global oil prices The oil price volatility is a dominant factor in the global economy world. According to analysts, the war between the U.S. and Iraq had one of the reasons security of the oil business, linked to the influence of this source of energy in all production activities. Crude oil has always been an important element in diversifying portfolio. This benefit has increased further historical diversification in 2009 / 2010. With the U.S. Federal Reserve pumping more money into the system, the price of oil is likely to head higher which can provide improved performance by investors, in addition to reducing the volatility of the portfolio in 2011....   [tags: Government]

Better Essays
945 words (2.7 pages)

Essay on The Impact of OPEC on the World Economy

- The Impact of OPEC on the World Economy The Organization of Petroleum exporting countries, better known as OPEC, is one of the most recognized cartels in the world. Yet, how many of those who can recognize the name really understand the cartel. I would venture to guess not many and even fewer know about the economic impact it has upon the world. To really get a feel for OPEC one has to delve deep into the heart of the cartel. This can be accomplished by looking at the economic definition of a cartel, the history of OPEC, OPEC today, OPEC and international trade, and the political questions that surround the cartel....   [tags: History OPEC Oil Cartel]

Better Essays
1869 words (5.3 pages)

Impact of Shale Gas Boom on the Market Essay

- Shale gas has exploded in the North American market. Technology advancements and closing the gap in the days required for in between well moves are making it profitable for owner/operators. Other markets are faced with numerous challenges, and for them this is not the case. What are the challenges that European and Asian markets face, and when will they reap the rewards from their shale rich geologies. Less than 5 years ago, North America’s shale boom was readily dismissed and looked upon as a “source for marginal additions” to the supply of oil globally....   [tags: natural gas, North America, Europe, Asia]

Better Essays
862 words (2.5 pages)

Essay about Global Trade And Regional Trade Agreements

- Global Trade versus Regional Trade Agreements There has been a massive increase in global trade in the past 30 years, and economists in developing and developed nations were excited by the formation of the World Trade Organization (WTO). They hoped for global economic gains for all member nations (Hyun Chong, K. (2011). The WTO’s effectiveness in the global arena has come under severe criticism with the inability to complete the Doha agreement, leading to economists to suggest that the WTO stop and try a new approach....   [tags: World Trade Organization, International trade]

Better Essays
1392 words (4 pages)

International Trade And The Global Economy Essay

- International trade is the exchange of goods, capital between countries and region, which has given rises to the global economy. International trade allows countries and region focus on their comparative advantage, so it should benefit each trading partner. Economics is the allocation of resources and international trade allows us to go beyond just one nation’s resources to manage the planet’s resources, which may benefit a nation more than another one but overall it is helping us to use our resources effective....   [tags: Economics, Trade, International trade]

Better Essays
1004 words (2.9 pages)

Essay about International Trade and The Global Economy

- Free Trade International trade links countries to the global economy (Vollrath, 1991). The global economy needs free trade. Countries need free trade. Trade with other countries occurs at some level in every country globally. There may be some indigenous tribes within some countries that can lay the claim that they are self-sufficient, however, there is not a single country that can say the same. Proponents of an open trading system contend that international trade results in higher levels of consumption and investment, lower prices of commodities, and a wider range of product choices for consumers (Carbaugh, 2009, p26)....   [tags: Global Commerce]

Better Essays
1026 words (2.9 pages)

Globalization: Sharing Our Prosperity With the World Essay

- Globalization is the growing interdependence of the world's people that involves the integration of economies, technologies, and cultures (Bradshaw). It is described as the increased movement of people, knowledge and ideas, and goods and money across national borders that have led to the increased interconnectedness among the world. Globalization is often thought of in economic terms but as we know there are three major components implicated with this idea including: economics, politics, and cultures....   [tags: Outsourcing, Offshoring, Free Trade]

Better Essays
1378 words (3.9 pages)