What is Opec and how does it control the price of oil in the world?
- Chi GuyLv 51 decade agoFavorite Answer
OPEC controls the vast majority of oil production.
They are a consortium of oil producing nations such as Saudi Arabia, Venezuela, Iran and such.
"The Organization of the Petroleum Exporting Countries (OPEC) is a permanent intergovernmental organization, created at the Baghdad Conference on September 10–14, 1960, by Iran, Iraq, Kuwait, Saudi Arabia and Venezuela. The five Founding Members were later joined by nine other Members: Qatar (1961); Indonesia (1962); Socialist Peoples Libyan Arab Jamahiriya (1962); United Arab Emirates (1967); Algeria (1969); Nigeria (1971); Ecuador (1973) -- suspended its membership from December 1992-October 2007; Angola (2007); and Gabon (1975–1994)."
- 1 decade ago
OPEC stands for "Organization of Petroleum Exporting Countries." It is a cartel. A cartel is like a monopoly, only instead of one company or organization supplying a product (and therefore dictating the price), a cartel is a group of organizations that collude together to set prices. While OPEC does not include all oil producing countries, it does have all of the major oil producers, so that they still have the ability to set the price of oil worldwide, as a practical matter.
Under American law, monopolies (say, power companies) are usually heavily regulated to prevent them from demanding extortionate prices, and cartels--that is, companies that should be competing but that are instead colluding together to set prices--are against the law.
www.RedBloodedAmericanGirl.comSource(s): Personal knowledge, education
- Anonymous1 decade ago
They control production/output/release of crude oil thus the price will fluctuate up or down accordingly. Not as so many like to say what king George dictates. They are so uninformed.Source(s): http://en.wikipedia.org/wiki/OPEC