logo

Critical Thinking OPEC and the Global Market

6 Pages1308 Words80 Views
   

Added on  2020-04-21

Critical Thinking OPEC and the Global Market

   Added on 2020-04-21

ShareRelated Documents
Running head: CRITICAL THINKING: OPEC AND THE GLOBAL MARKETCritical Thinking: OPEC and the Global MarketName of the StudentName of the UniversityAuthor Note
Critical Thinking OPEC and the Global Market_1
1CRITICAL THINKING: OPEC AND THE GLOBAL MARKETAbstractThe purpose of the essay is to account a historical background of The Organization of thePetroleum Exporting Countries (OPEC) and investigate the situation OPEC faced over thelast ten years. Next section, the essay considers a member under the OPEC economy SaudiArabia and also analyzes the effects under the global oil crisis. Having analyzed the effect,based on the above mentioned analysis, the essay concludes with possible ways that helps torecover Saudi from the oil price crisis.
Critical Thinking OPEC and the Global Market_2
2CRITICAL THINKING: OPEC AND THE GLOBAL MARKETThe Organization of the Petroleum Exporting Countries (OPEC) is anintergovernmental organization and was created in Baghdad at the Baghdad conference on10th to 14th September, 1960 by 5 countries Iraq, Iran, Kuwait, Venezuela and Saudi Arabia(Carbaugh, 2017). Later on, ten other countries Qatar, Indonesia, Algeria, United ArabEmirates, Gabon, Ecuador, Libya, Angola, Nigeria and Algeria joined them; however, themembership of both Ecuador and Gabon had been suspended by their own request in the year1992 and 1994, respectively (Griffin & Teece, 2016). Out of this context, the essay discussesabout one of the member countries Saudi Arabia and investigates the dynamics that OPECeconomy has faced over the last ten years and also analyzes its effects in terms of SaudiArabia’s jurisdiction. OPEC has its own headquarters in Geneva, Switzerland; however, aftera few years, they had moved it to Vienna, Austria. This organization’s main objectives is tobuild up an uniform and well coordinated petroleum policy in order to secure stable prices forthe oil producing member countries and also provide an efficient oil supply to the othernations.Like prices of other goods, oil prices have also experienced a tremendous priceswings over a decade based on the changes in demand and supply of crude oil especially afterthe American involvement with Iraq and rapidly increasing oil demand from China. Thiscombination has led to a drastic rise in the oil price to US$147/bbl in 2003-2008 (Kilian &Hicks, 2013). Meanwhile, in May 2008, Indonesia had been withdrew its name from theOPEC list for the reason of which OPEC could not be able to fulfill their net productionquota (Kilian & Hicks, 2013). Eventually, poorer nations have started pressurizing to cutdown the production in order to maintain the earlier revenue. However, Saudi Arabia did notsupport this proposal as their strategy was to be partnered with the most world’s mostpowerful economic nations to ensure a steady and rapid flow of crude oil. In fact, OilMinister of Saudi Arabia, Ahmed Yamani had warned the other economies that high oil
Critical Thinking OPEC and the Global Market_3

End of preview

Want to access all the pages? Upload your documents or become a member.

Related Documents
OPEC's Influence on Global Oil Prices - Doc
|11
|3606
|36

Differences and Similarities Between OPEC and IEA
|9
|2121
|186

OPEC and Global Market
|6
|1468
|163

Response to Articles Course 2022
|8
|990
|9

A Study About OPEC and IEA
|9
|2351
|207

Opec and The Oil Shock Question Answer 2022
|5
|774
|14