Organization Of Petroleum Exporting Countries - OPEC


DEFINITION of 'Organization Of Petroleum Exporting Countries - OPEC'

An organization consisting of the world's major oil-exporting nations. The Organization of Petroleum Exporting Countries (OPEC) was founded in 1960 to coordinate the petroleum policies of its members, and to provide member states with technical and economic aid. OPEC is a cartel that aims to manage the supply of oil in an effort to set the price of oil on the world market, in order to avoid fluctuations that might affect the economies of both producing and purchasing countries.

BREAKING DOWN 'Organization Of Petroleum Exporting Countries - OPEC'

OPEC membership is open to any country that is a substantial exporter of oil and that shares the ideals of the organization. As of 2011, OPEC had 12 member countries, including founder members Iran, Iraq, Kuwait and Venezuela.

OPEC's influence on the market has been widely critcized. Because its member countries hold the vast majority of crude oil reserves (about 80%) and nearly half of natural gas reserves in the world, the organization has considerable power in these markets.

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  1. How much influence does OPEC have on the global price of oil?

    In the short term, the Organization of Petroleum-Exporting Countries (OPEC) has significant influence on the price of oil. ... Read Full Answer >>
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    As of 2015, the average per barrel monthly cost for an oil producer to store its oil inventory on a supertanker ranges between ... Read Full Answer >>
  3. Why did oil prices drop so much in 2014?

    Oil prices have been one of the most watched trends in economics during the 21st century. From 2000 to 2008, the price of ... Read Full Answer >>
  4. What causes oil prices to fluctuate?

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