Organization of Petroleum Exporting Countries

Organization of Petroleum Exporting Countries
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Organization of Petroleum Exporting Countries (OPEC)
What is OPEC?
The Organization of Petroleum Exporting Countries (OPEC) is an agglomeration of 12 oil-producing states. The members are United Arab Emirates, Saudi Arabia, Nigeria, Algeria, Kuwait, Iran, Libya, Qatar, Iraq, Venezuela, Ecuador and Angola. The significance of this organization is that its members are the world`s largest producers of crude oil. This is attributed to the abundant amounts of crude oil they have in their oil wells.
Turmoil in the member-states
Oil being the world`s primary source of energy greatly increases its demand. For this reason, OPEC countries have been continuously competing over control of its supplies. An extreme incident occurred when the then Iraqi president Saddam Hussein invaded Kuwait in a bid to take over production of oil in the region. This led the USA to intervene in form of the ‘Persian Gulf War`. Despite the success, the cost of military involvement in ensuring a steady supply of the precious commodity keeps the price of oil significantly higher by the time it reaches the USA. As a result of such measures, oil has become the world`s most expensive source of energy with its average cost being $100 a barrel.
From this it becomes evident that the world`s major producers of oil are located in volatile areas prone to wars and other factors that threaten its safe delivery to its eager customers.
A surge in the price of crude oil