OPEC(redirected from Flag of the Organization of Petroleum Exporting Countries)
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Organization of Petroleum Exporting Countries
Organization of Petroleum Exporting Countries (OPEC), multinational organization (est. 1960, formally constituted 1961) that coordinates petroleum policies and economic aid among oil-producing nations. Its Board of Governors and board chairperson are elected by member nations; OPEC's headquarters are in Vienna, Austria. Members, most of which joined by 1975, now consist of Algeria, Angola (joined 2007), Equatorial Guinea (joined 2017), Gabon (withdrew 1995–2016), Iran, Iraq, Kuwait, Libya, Nigeria, Saudi Arabia, the United Arab Emirates, and Venezuela. Former members include Indonesia, which has twice suspended (2009–16, 2016–) its participation, Ecuador, which also has twice suspended (1992–2007, 2020–) its participation, and Qatar, which withdrew in 2019. Saudi Arabia has traditionally dominated the organization, owing to its enormous oil reserves; the organization's members produce about 40% of the world's crude oil.
In 1973, as a result of the Arab oil embargo against Western nations who supported Israel during the Yom Kippur War (see Arab-Israeli Wars), OPEC was able to raise oil prices significantly; the price hike caused inflation in oil-importing nations. Further increases ensued but by 1982, as importing countries pursued alternate energy resources and policies designed to reduce oil consumption, OPEC was forced to lower prices. Subsequently OPEC has at times been able to raise oil prices by cutting production, though it has needed the cooperation of major non-OPEC oil-exporting nations to do so. More often, prices have fluctuated in response to changes in demand and to national or international instability and conflict that have reduced or threatened to reduce oil production.