OPEC: THE ORGANIZATION

The essential purpose of the organization has not changed since it was founded. That purpose is to (1) unify and coordinate the petroleum policies of the member states, and (2) safeguard the general interests of the member states.

Knowledge of the enduring purpose of the organization does not address the underlying issue of why the five original member states of OPEC negotiated and ratified the treaty to establish the organization. The analogy of the labor union may be used to explain the motivation of Iran, Iraq, Kuwait, Saudi Arabia, and Venezuela to create OPEC. Labor unions typically are formed to provide individual workers with increased power through unified action to negotiate in their own interests with a ground of employers which is smaller in number but much stronger in power than are the workers as individuals.

In 1960, the power in the global crude petroleum industry was in the collective hands of the so-called "Seven Sisters," which were seven powerful multinational oil companies headquartered in Western nations. The five countries that were to bec

. . .
such policies were in opposition to OPEC policies. This situation weakened OPEC in its dealings with the multinational oil companies. OPEC is comprised of oil producing and exporting countries. The unity of the organization is maintained by a common bond of interests among the member countries; however, that common bond of interests does not mean that the organization always functions smoothly. The executive functioning of OPEC is conducted by a Secretariat located at the organization's headquarters. OPEC headquarters originally was located in Geneva. The organizational headquarters was moved, however, to Vienna in 1965. The Secretariat of OPEC is directed by a Secretary General. The Secretary General may be appointed through one of two procedures. First, if all member states of the organization can agree on a nominee, that person may be appointed to the position of Secretary General on the basis of merit. For several years this procedure was followed when Saudi Arabian Oil Minister Sheikh Yamani virtually ran OPEC. When the member countries cannot agree on a nominee, which frequently is the case, the position is filled on the basis of rotation among the member states. The Secretariat of OPEC, under the direction o
. . .

Some common words found in the essay are:
Seven Sisters, Saudi Arabia, Council Ministers, Board Conference, Countries OPEC, Saudi Arabia's, OPEC Labor, Third World, Secretary Secretary, OPEC Secretary, crude oil, oil companies, saudi arabia, council ministers, production levels, opec council ministers, production quotas, five countries, opec council, multinational oil, multinational oil companies, production levels quotas, levels quotas, crude oil resources, observe production quotas,
Approximate Word count = 1556
Approximate Pages = 6 (250 words per page)

More Essays on OPEC: THE ORGANIZATION