The World s Oil And Its Impact On The Economy - 1926 Words

powerful group because it controls 80% of the world’s oil and therefore is extremely influential in country’s economic system. The policies developed by OPEC directly affect the production of oil globally. It was formed at the Baghdad Conference in 1960 by Iran, Iraq, Kuwait, Saudi Arabia, and Venezuela. Venezuela alone harbors 20% of the world’s oil. As OPEC memberships of countries were suspended other countries joined. Today, 13 member countries: Algeria, Angola, Ecuador, Indonesia, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, United Arab Emirates, and Venezuela. These countries bare the unalienable right to manage their natural resources in the interest of their progress as a nation under the â€Å"Declaratory Statement of†¦show more content†¦The United States may be one of the leading oil producers, but it refuses to join OPEC because we recognize the â€Å"cartel† it is and how it reaches ideal pricing through manipulation. The International Energy Agency announced that the United States is to surpass Saudi Arabia in oil production by 2020 because of the continuous advancement in technology. It will not retain the high status for long because the IEA estimated that the U.S.’s five years of glory will slump back second to Saudi Arabia in 2025. It’s unlikely the U.S. will join OPEC, because â€Å"In the U.S., the investment return is for oil companies and their shareholders, while for OPEC countries, the return is for state-owned oil companies and, ultimately, the governments of the member countries† (Loren, S.) . For once being an outsider is beneficial because as OPEC maintains oil prices stable and relatively high we are able to economically invest in new technology to extract oil and still gain millions in profit. Oil Drilling, Transportation, Use Oil is of no use underground and will only regain its energy when it’s reintroduced into the oxygen rich atmosphere. Before any drilling is carried out the site must be given boundaries and environmental impact test are run. After oil companies sort out the legal issues, allowing them to extract the oil the land is prepared Traditionally Oil Drilling has been used since 1859, where a hole is dug into the Earth