OPEC, which stands for "The Organisation of the Petroleum Exporting Countries" is an intergovernmental organisation made up of 13 oil producing nations.
According the OPEC website: "The Organization of the Petroleum Exporting Countries (OPEC) is a permanent intergovernmental organization, created at the Baghdad Conference on September 10–14, 1960, by Iran, Iraq, Kuwait, Saudi Arabia and Venezuela. The five Founding Members were later joined by nine other Members: Qatar(1961); Indonesia (1962) -- suspended its membership from January 2009; Socialist Peoples Libyan Arab Jamahiriya (1962); United Arab Emirates (1967); Algeria (1969); Nigeria(1971); Ecuador (1973) -- suspended its membership from December 1992-October 2007; Angola (2007); and Gabon (1975–1994).".
OPEC member nations currently supply about 40% of the world's crude oil and 16% of its natural gas. OPEC nations possess about 79% of the world's total proven crude oil reserves and 44% of the world's crude oil production.
This means that OPEC effectively seeks to operate as a cartel, determining supply so as to keep prices - and profits - high. However in practice this isn't so easy, as exemplified by the demand-side shock in 2008 that saw oil prices plummet from a record high of US$147 to just over US$30 a barrel..
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