ORGANIZATION OF PETROLEUM EXPORTING COUNTRIES

Abstract

Listen

Translate article

This chapter describes the main functions of the Organization of Petroleum Exporting Countries (OPEC). The first step toward the establishment of OPEC was taken in 1959, following a unilateral reduction by the major oil companies of the posted prices of Venezuelan and Middle East crude oil. The main preoccupation of OPEC member States during the first decade of the organization's existence was to increase tax revenues from oil concessions operated on their territories by foreign companies. But with the increasing political strength of member countries and of Third World countries in general during the 1960s, the concern for taxation gave way toward the end of the decade to demands for equity participation in the concessions. The realization in large part of these demands by the early 1970s signaled a breakthrough in the nature of the member countries' relationship with the major transnational oil companies. The organization has three main organs, the Conference, the Board of Governors, and the Secretariat. The Economic Commission was established by the Conference as a specialized organ of OPEC.