OPEC stands for the Organization of the Petroleum Exporting Countries. It was founded in Baghdad, Iraq, with the signing of an agreement in September 1960 by five countries namely Islamic Republic of Iran, Iraq, Kuwait, Saudi Arabia and Venezuela.
The five founding members were later joined by Qatar (1961), Indonesia (1962), Libya (1962), the United Arab Emirates (1967), Algeria (1969), Nigeria (1971), Ecuador (1973), Gabon (1975) and Angola (2007).
From December 1992 until October 2007, Ecuador suspended its membership. Gabon terminated its membership in 1995. Indonesia suspended its membership effective January 2009.
Currently, the Organization has a total of 12 Member Countries.
organization is based in Vienna and controls over 40% of the world's
total oil production, and its member nations account for over 60% of
the world's estimated oil reserves.
OPEC sets production targets for its member nations and generally, when OPEC production targets are reduced, oil prices increase. Projections of changes in Saudi production result in changes in the price of benchmark crude oils.
Recently, a number of analysts started critising OPEC for inability to face and prevent oil plunge, which had begun in June 2014, claiming that U.S. shale oil is likely to replace the body as the first-mover "swing producer".