The hegemony of OPEC in the global oil industry is well known. We know how it controls oil prices globally and how eve US has not been able to challenge the cartel's status and control over oil. the last oil embargo had already left US deeply troubled. It is why despite so much debate it has not brought antitrust suite against the cartel. Prior to the formation of OPEC the international oil industry was controlled by the seven sisters or the seven oil companies. The agreements that these companies drafted were generally favorable for the companies. the oil producing nations were not so developed those days and were just developing. They were happy with what hey received from these companies as they lacked the resources to produce oil themselves. These nations received one time royalty payments except for Venezuela. It was also the first nation to raise taxes against the companies and object to their methods. It accomplished some strong profits in its own favor that encouraged other oil producing nations. This is how OPEC came to be born. OPEC's first meeting was held in 1960 and in its initial years OPEC did not influence moil prices significantly. After 1970 OPEC countries started exerting control over the oil prices. these nations which were once being exploited of their valuable oil git 100% control of their oil and oil fields by 1973. OPEC countries enjoyed better profits and revenues which led to faster rate of growth. Since then OPEC has remained in control and has used its power to influence demand and supply as well as prices of oil globally. This is a significant power which is difficult to challenge. It is also for its influence, control and methods of operation that it is called the world's biggest oil cartel.
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AuthorAbhijeet Pratap Archives
October 2021
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