OPEC

Concept: OPEC
Topic: Economy, Paper II
Category: Growth, GDP
Related News: Hindu, Jan 19
CNA mentions: 1(Jan 19,Jan 21)

OPEC

OPEC or the Organization of the Petroleum Exporting Countries is a grouping of 14 countries headquartered in Vienna since 1965. It was founded by its first five members-countries in 1960 in Baghdad. As of 2015, the OPEC countries were responsible for 43% of the world’s oil production and 73% of the global ‘proven’ oil resources. This gives the multinational organisation a huge influence on the world’s oil prices. With many members differing on various matters like their production costs, capacities for oil export, geological features, oil reserves, economic development, population and political situations, OPEC has found it difficult to consent among itself over policy issues.

The presence of oil resources themselves are a cause for damaging conflicts and instability in many regions. This phenomenon where natural resources can be a source of problem for many countries is called the ‘natural resource curse’ by economists.