Essay on Oil
The Power of Oil The impact of globalization on the distribution of wealth as regards Organization of Petroleum Exporting Countries (OPEC) is immense. ... OPEC, founded in September of 1960 by Iran, Iraq, Kuwait, Saudi Arabia and Venezuela had the objective of coordinating and unifying the oil policies of member countries. ... The fundamentals of this success are based on the international demand for OPEC oil and whether OPEC has the capacity to meet or exceed that demand. ... With the improvements being made daily in energy efficiency, the adoption of new conservation measures and environmentalists success in replacing oil with cleaner sources of energy, the changes inherent in the OPEC member countries will take more than some simple improvements to sustain the organization (Amuzegar 25). ... Oil prices have fallen rapidly within the last year and it is due to many factors: a dictator, a climactic anomaly, a cartel and an economic crisis. These factors together have caused the price of oil to drop to an all time low, the likes of which have not been seen in several years (The Economist PG). ... Political unrest and an oversupply of oil have all joined to sabotage the corrective actions of OPEC to sustain the organization through rough waters. ... OPEC was never able to control both world oil prices and its own market share at the same time. ... While these members have seventy seven percent of the worlds proven petroleum deposits but only forty one percent of the global crude oil output, members have an incentive to stick together since OPECs market strength will likely change in their favor. ... The Economist, "An Oil Bounce," (1998): January, PG.