What does Organization of Petroleum Exporting Countries - OPEC mean?
The Organization of the Petroleum Exporting Countries (OPEC) is a cartel of some leading oil producing and exporting countries. OPEC members hold over 80% of the global oil reserves and produce more than a third of world output.
Futures Knowledge Explains Organization of Petroleum Exporting Countries - OPEC
As OPEC controls much of the world’s oil supply, the cartel use to dictate the price trough production cuts and regulating supplies. In 1973, OPEC imposed an embargo and the price of oil shot up from $1.70 a barrel to $12.50. In 2008 also, the members agreed to cut the production ceiling by 2.2 million barrels per day when the price had crashed to $37 from $137 due to global economic crisis. However in November 2014, OPEC decided not to cut production to arrest a continuing slide in crude prices since June 2014, a shift from its earlier policy.
Created in 1960, OPEC has 12 member countries- Saudi Arabia, Iran, Iraq, Kuwait, Venezuela, Qatar, Libya, UAE, Algeria, Nigeria, Ecuador and Angola. Most of member countries rely on oil as a major source of revenue and for their national budgets.