ORIGIN OF OPEC
Organization of Petroleum Exporting Countries (0PEC), comprises 13 third-world petroleum-producing countries, formed in 1960 to promote and protect the interest of its members. OPEC as an organization was formed as a reaction to the exploitative motives of multinational companies, which as at that time were controlling oil operations in the oil-producing countries in 1960. Five oil-producing countries met in Baghdad the capital of Iraq to form a union that will fight against the exploitative tendencies of multinational companies.
The five countries that held the meeting were; Iran, Iraq, Kuwait, Saudi Arabia and Venezuela. Some other countries later joined the organization because of its effort in curtailing the activities of the oil companies. Countries like Algeria (1969), Nigeria (1971), Gabon and United Arab Emirate (1973), joined the organization.
AIMS AND OBJECTIVES OF OPEC
Here are the aims and objectives of OPEC (Organization of the Petroleum Exporting Countries):
1. Price Stabilization: One of the primary objectives of OPEC is to stabilize the price of oil in the global market. OPEC aims to prevent significant fluctuations in oil prices by managing production levels and adjusting supply to meet demand.
2. Coordinating and Unifying: OPEC strives to coordinate and unify the oil policies of its member nations. This involves aligning production levels, export strategies, and market approaches to ensure a collective and cohesive stance on oil-related matters.
3. Ensuring Steady Income: OPEC aims to ensure a steady and reliable income for its member states by maintaining stable oil prices. By collectively managing production levels, OPEC seeks to avoid extreme price fluctuations that could negatively impact member economies.
4. Secure Supply: OPEC’s objective is to ensure a steady supply of oil to consuming nations. By effectively managing production and export levels, OPEC aims to meet the global demand for oil consistently.
5. Quota System: OPEC implements a quota system to fix and allocate production quotas to its member nations. This mechanism helps regulate production levels and maintain stability in the global oil market.
6. Protecting Member States: OPEC was established to protect the interests of its member states. This involves safeguarding their sovereignty over their oil resources and ensuring that the participation of foreign multinational companies in oil exploitation does not undermine the interests of member nations.
7. Negotiating Participation: OPEC engages in negotiations with member nations and other stakeholders to facilitate the participation of its members in oil exploitation and exploration activities. By negotiating favorable terms and agreements, OPEC aims to enhance the involvement of member nations in the oil industry.
It’s worth noting that the specific aims and objectives of OPEC may evolve over time as the organization responds to changing market dynamics and global energy landscape.
EVALUATION QUESTION
- Briefly describe the origin of OPEC.
- List five aims and objectives of OPEC.
ORGANS OF OPEC
- The conference
- The board of Governors
- The Secretariat.
THE CONFERENCE
The Conference is the supreme organ of OPEC. Each member-nation is represented by its Minister of Petroleum who lead the a delegation to OPEC meetings. It meets twice in a year but the Secretary General can call for extra-ordinary meeting after due consultation with the President of the Conference and approved by a simple majority of member-states. The ordinary meetings of the Conference are held in Vienna, Austria, the organization’s headquarters and each member has a simple vote.
FUNCTIONS OF THE CONFERENCE
- The Conference formulates the general policy of the organization and determines the appropriate methods and means of its implantation.
- It appoints the Secretary General, the Deputy Secretary, the Chairman and the Alternate Chairman of the Board of Governors.
- It approves the appointment of the members of the Board of Governors.
- It considers the applications for membership of OPEC.
- It approves the budget of the Organization.
- The Conference considers and approves all reports and recommendations submitted by the Board of Governors.
- It appoints auditors that examine the accounts of the organization.
THE BOARD OF GOVERNORS
This organ is made up of representatives called governor. Every governor has one vote and serves for a term of two years. The board meets at least twice a year.
FUNCTIONS OF THE BOARD OF GOVERNORS
- It manages the affairs of the organization
- It prepares agenda for the meeting of the conference.
- The board implements the decisions made by the conference.
- The board nominates the auditor of the organization.
- The board also prepares the budget of the organization.
- The board considers and submits the statement of account and the auditor’s report to the conference for approval.
- The board considers and takes decisions on any report submitted by the Secretary General.
See also
SPECIALIZED AGENCIES OF U.N.O | ILO, W.H.O, F.A.O., UNESCO, UNICEF & I.M.F
UNITED NATION ORGANIZATION | ORIGIN, PRINCIPLES, AIMS & OBJEVTIVES
THE SECRETARIAT
The Secretariat of OPEC is located in its headquarters in Vienna, Austria. The organ carries out the executive functions of the organization. The head of the secretariat is the Secretary General, assisted by a deputy Secretary General and other members of staff. The Secretary General has three years tenure and could be re-appointed.
FUNCTIONS OF THE SECRETARIAT
- The secretariat is responsible for all the correspondence of the organization.
- It performs the executive and administrative functions of the organization.
- It represents the organization.
The departments of the secretariat are;
- Information department
- Economic department
- Administrative department.
- Technical department.
EVALUATION QUESTIONS
- List five functions of the conference of OPEC.
- List five functions of the board of governors of OPEC.
GENERAL EVALUATION/REVISION QUESTIONS
- Explain the causes of the Kaduna state executive/legislative crisis of 1981.
- Enumerate the immediate causes of the civil war.
- Enumerate the positive consequences of the civil war
WEEKEND ASSIGNMENT
- OPEC was established in____ (a) 1962 (b) 1970 (c) 1960
- Nigeria was admitted into OPEC in the year____ (a) 1971 (b) 1970 (c) 1981
- The supreme organ of OPEC is _____ (a) The Secretariat (b) The Board of Governors (c) The Conference
- The annual budget of OPEC is prepared by the____ (a) Board of Governors (b) Conference (c) Secretariat
- The headquarters of OPEC is located in_____ (a) London (b) New York (c) Austria.
THEORY
- Highlight 4 functions of the Conference of OPEC.
- State 5 aims and objectives of OPEC
See also
ECONOMIC COMMUINTY OF WEST AFRICAN STATES (ECOWAS) | ACHIEVEMENTS & PROBLEMS
ECONOMIC COMMUINITY OF WEST AFRICAN STATES (ECOWAS).
SPECIALIZED AGENCIES OF THE U.N.O | PURPOSES, ACHIEVEMENTS, PROBLEMS