Organisation of the Petroleum Exporting Countries (OPEC)

GS 2 – International organisation  

The Organisation of the Petroleum Exporting Countries (OPEC) is a permanent intergovernmental body established in 1960 during the Baghdad Conference. It was formed to coordinate and unify petroleum policies among member countries.

 

Founding Members: Iran, Iraq, Kuwait, Saudi Arabia, and Venezuela.

 

Current Members: Algeria, Congo, Gabon, Equatorial Guinea, Iraq, Iran, Kuwait, Libya, Nigeria, Saudi Arabia, UAE, and Venezuela.

Secretariat: Vienna, Austria.

Objective:

• Ensure fair and stable oil prices for producers.
• Guarantee an efficient and uninterrupted supply of petroleum to consumers.
• Provide fair returns to investors in the petroleum industry.

Decision-Making: OPEC operates on a one member, one vote system, with decisions requiring unanimity.

Significance: OPEC members control 80% of the world’s proven crude oil reserves.

 

India relies heavily on OPEC for its energy needs:

• 70% of crude oil,
• 60% of Liquefied Petroleum Gas (LPG),
• 30% of Liquefied Natural Gas (LNG),
• 45% of petroleum product demand.

Publication: World Oil Outlook

OPEC Fund for International Development

Established in 1976, it is a multilateral financial institution dedicated to providing development assistance.

Unique in its mandate, it channels resources from member countries to non-member countries.

 

Organisation of the Petroleum Exporting Countries Plus (OPEC+)

 

• Formation: Created in 2016 and also known as the Vienna Group.
• Composition: OPEC members plus 10 non-OPEC oil-exporting nations, including:
• Azerbaijan, Bahrain, Brunei, Kazakhstan, Malaysia, Mexico, Oman, Russia, South Sudan, and Sudan.
• Production Share: Collectively responsible for producing 40% of the world’s crude oil.
• Declaration of Cooperation: OPEC+ members agreed to production adjustments aimed at achieving stability in the global oil market for the benefit of both producers and consumers.