OPEC Profile
The Organization of Petroleum Exporting Countries(OPEC) functions as an international conglomerate whose purpose is threefold:to synchronize petroleum policies on a global scale, provide stable and securemarket prices, and ensure the mutual profit and benefit of its members. TheOrganization was founded in Baghdad in 1960 bythe original member states of Iran,Iraq, Kuwait, Saudi Arabia and Venezuela. Since that time, ithas expanded to its current number of 12 member states, and includes countries spreadthroughout the Middle East, Africa and South America.
OPEC supplies crude oil on a global scale; theorganization controls approximately 81.33% of the world’s crude oil reserves,and in 2010 produced an average of 29,183,000 barrels per day (b/d). OPECmaintains a majority 1193 billion barrels of petroleum reserves, compared tonon-OPEC countries who control approximately 274 billion barrels of reserves.
Today, petroleum is a vital resource. It is thelifeblood of a large number of industries, including manufacturing,transportation, defence, and trade. As such, oil production by OPEC, and the effortsof the Organization to stabilize the sale of its products, becomes an issue ofimmense economic and strategic importance. Maintaining the supply for theglobal demand is the prime objective of OPEC and its member countries.
The Organization functions through the actions ofseveral different administrative bodies. The OPEC Conference consists of adelegation from all member states, where representatives will vote onresolutions or issues that affect the oil export industry. Conferences must becalled at least twice a year and are held at the Organization’s headquarters inVienna, Austria. The OPEC Board ofGovernors enacts decisions and makes recommendations on policies determined inthe Conference. The Board is also responsible for determining the budget of theOrganization for the coming year, approval of which must come from theConference. Finally, the OPEC Secretariat works to enact the policies of boththe Board of Governors and the Conference, and acts as a spokesperson for theOrganization. The Office of the Secretariat is represented by the Secretary General,who is elected for three year terms by a majority vote of member states. The currentSecretary General is Abdalla Salem El-Badri of Libya.
OPEC is made up of 12 globally diverse member states.Each member state contributes delegates to the OPEC Conference and Board ofGovernors. A delegate from each nation is recommended to attend each meeting ofthe Conference and Board of Governors, however a quorum of only ¾ is requiredto pass a resolution.
As the leading entity within the petroleumindustry, OPEC maintains a progressive policy of environmental stewardship. TheOrganization supports initiatives which seek to reduce carbon emissions,through technologies such as carbon capture and storage (CCS), and promotesdialogue on environmental issues between member countries and other nations.
In addition to these activities, OPEC contributesto a wide range of socially responsible initiatives. The Organization hosts theOPEC Fund for International Development (OFID), which provides financialassistance to developing nations that are not members of OPEC. In 2009 alone,the OFID made $ 2.4 billion dollars in contributions to developing nations;since it began in 1975, the program has donated funds to over 125 differentcountries. In addition, OPEC maintains over two hundred other lending programsdirected to the public, private and trade sectors, as well as humanitarianassistance donations for pressing issues like Emergency Relief Aid and HIV/AIDSresearch.
In its current operations, OPEC faces a number ofchallenges. Some of these are purely logistical, like meeting consumer demand,increasing production output, and maintaining market stability. TheOrganization also faces challenges which apply to the petroleum industry as awhole; crises such as the Deepwater Horizon oil spill have polarized anincreasing public demand for eco-friendly and green business practice in thesale, transportation and use of OPEC products. Some other problems can stemfrom the political field. Embargos against member countries directly violatesarticle 2 section A of the OPEC statute, and is looked upon as beingdetrimental to the collective trade, stability and cooperation encouraged bythe Organization.
OPEC strivesto meet the demands of customers and stakeholders, and will continue to overcomewhatever challenges stand in the way of its objectives of providing affordableand vital petroleum resources to the global market.
References:
(n.d.). OPEC and theenvironment. Retrieved from:
http://www.opec.org/opec_web/static_files_project/media/downloads/press_room/OPEC_Environmental_position.pdf
(2008). OPEC statute.Retrieved from:
http://www.opec.org/opec_web/static_files_project/media/downloads/publications/OS.pdf
(2011). OPEC annualstatistical bulletin. Retrieved from:
http://www.opec.org/opec_web/static_files_project/media/downloads/publications/ASB2010_2011.pdf
(2012). OPEC: briefhistory. Retrieved from:
http://www.opec.org/opec_web/en/about_us/24.htm
(2012). OPEC: OFID.Retrieved from:
http://www.opec.org/opec_web/en/about_us/716.htm
The Organization of Petroleum Exporting Countries(OPEC) functions as an international conglomerate whose purpose is threefold:to synchronize petroleum policies on a global scale, provide stable and securemarket prices, and ensure the mutual profit and benefit of its members. TheOrganization was founded in Baghdad in 1960 bythe original member states of Iran,Iraq, Kuwait, Saudi Arabia and Venezuela. Since that time, ithas expanded to its current number of 12 member states, and includes countries spreadthroughout the Middle East, Africa and South America.
OPEC supplies crude oil on a global scale; theorganization controls approximately 81.33% of the world’s crude oil reserves,and in 2010 produced an average of 29,183,000 barrels per day (b/d). OPECmaintains a majority 1193 billion barrels of petroleum reserves, compared tonon-OPEC countries who control approximately 274 billion barrels of reserves.
Today, petroleum is a vital resource. It is thelifeblood of a large number of industries, including manufacturing,transportation, defence, and trade. As such, oil production by OPEC, and the effortsof the Organization to stabilize the sale of its products, becomes an issue ofimmense economic and strategic importance. Maintaining the supply for theglobal demand is the prime objective of OPEC and its member countries.
The Organization functions through the actions ofseveral different administrative bodies. The OPEC Conference consists of adelegation from all member states, where representatives will vote onresolutions or issues that affect the oil export industry. Conferences must becalled at least twice a year and are held at the Organization’s headquarters inVienna, Austria. The OPEC Board ofGovernors enacts decisions and makes recommendations on policies determined inthe Conference. The Board is also responsible for determining the budget of theOrganization for the coming year, approval of which must come from theConference. Finally, the OPEC Secretariat works to enact the policies of boththe Board of Governors and the Conference, and acts as a spokesperson for theOrganization. The Office of the Secretariat is represented by the Secretary General,who is elected for three year terms by a majority vote of member states. The currentSecretary General is Abdalla Salem El-Badri of Libya.
OPEC is made up of 12 globally diverse member states.Each member state contributes delegates to the OPEC Conference and Board ofGovernors. A delegate from each nation is recommended to attend each meeting ofthe Conference and Board of Governors, however a quorum of only ¾ is requiredto pass a resolution.
As the leading entity within the petroleumindustry, OPEC maintains a progressive policy of environmental stewardship. TheOrganization supports initiatives which seek to reduce carbon emissions,through technologies such as carbon capture and storage (CCS), and promotesdialogue on environmental issues between member countries and other nations.
In addition to these activities, OPEC contributesto a wide range of socially responsible initiatives. The Organization hosts theOPEC Fund for International Development (OFID), which provides financialassistance to developing nations that are not members of OPEC. In 2009 alone,the OFID made $ 2.4 billion dollars in contributions to developing nations;since it began in 1975, the program has donated funds to over 125 differentcountries. In addition, OPEC maintains over two hundred other lending programsdirected to the public, private and trade sectors, as well as humanitarianassistance donations for pressing issues like Emergency Relief Aid and HIV/AIDSresearch.
In its current operations, OPEC faces a number ofchallenges. Some of these are purely logistical, like meeting consumer demand,increasing production output, and maintaining market stability. TheOrganization also faces challenges which apply to the petroleum industry as awhole; crises such as the Deepwater Horizon oil spill have polarized anincreasing public demand for eco-friendly and green business practice in thesale, transportation and use of OPEC products. Some other problems can stemfrom the political field. Embargos against member countries directly violatesarticle 2 section A of the OPEC statute, and is looked upon as beingdetrimental to the collective trade, stability and cooperation encouraged bythe Organization.
OPEC strivesto meet the demands of customers and stakeholders, and will continue to overcomewhatever challenges stand in the way of its objectives of providing affordableand vital petroleum resources to the global market.
References:
(n.d.). OPEC and theenvironment. Retrieved from:
http://www.opec.org/opec_web/static_files_project/media/downloads/press_room/OPEC_Environmental_position.pdf
(2008). OPEC statute.Retrieved from:
http://www.opec.org/opec_web/static_files_project/media/downloads/publications/OS.pdf
(2011). OPEC annualstatistical bulletin. Retrieved from:
http://www.opec.org/opec_web/static_files_project/media/downloads/publications/ASB2010_2011.pdf
(2012). OPEC: briefhistory. Retrieved from:
http://www.opec.org/opec_web/en/about_us/24.htm
(2012). OPEC: OFID.Retrieved from:
http://www.opec.org/opec_web/en/about_us/716.htm
