There are now
12 members of OPEC after Ecuador and Gabon withdrew in 1992 and 1994
respectively, Angola and Ecuador rejoined in 2007 and 2008 and Indonesia
withdrew. OPEC was established in 1960 although it did not exercise an
influence over the global industry until 1973. At this time the group
controlled 50% of oil production. Its head office is in Vienna.
prices and the rise of offshore production elsewhere OPECís global share
fell. Output quotas were introduced in 1986 to prop up the oil price.
Quotas lost their relevance in 2004 with OPEC then producing near its
full capacity but new quotas returned at the end of 2006 when prices
dropped and Angola joined the organisation. Restrictions were at higher
levels in 2009. However their effect is likely to be short-lived with
growth in output returning by 2011 although OPEC is expected to reach
permanent plateau production before 2020
OPEC, with its
rapidly growing economies and populations, has seen exceptional oil
demand increases - largely unaffected by higher prices due to
subsidised gasoline. However declining oil prices in 2008 led to a sharp
fall in demand as government revenues dropped.
Gas use too
has been increasing rapidly where gas is available, especially in the
Persian Gulf but the recession has hit industry in the Gulf particularly
hard so that demand is currently flat. Over the long term gas demand is
expected to grow substantially again, replacing oil wherever it can.