IS THE ORGANISATION OF PETROLEUM PRODUCING COUNTRIES A CARTEL, WHAT ACCOUNTS FOR ITS SUCCESS

Abstract

I first learnt of the Organization of Petroleum Exporting Countries in 1973. The organization which the newspapers popular/ phrased O. P E.C in their headlines was new to many people including myself. I was not quite sure what this organization was all about and why it had gained so much prominence in the world press. The Kenya newspapers like their counterparts in the world gave a very wide coverage of this organization, which seemed to be identified with the Arabs. A few years ago, that is 1968, 1969, 1970 we would read of the war in Vietnam and when the war ended the cry about oil and the high prices took a very high proportion which seems to be getting higher and higher. It is the plight of motorists, the hopelessness and desperation spelt across their faces that forced me to take a keen interest in this organization was also bewildered at the amount of power this organization was capable of wielding was a power capable of wrecking the economies of the world, obviously a very big risk to international peace and security oil became every- one’s major concern. For Kenyans who do not own vehicles like myself every time the price of oil would go up the fares would also be increased, and this is the position to this day. The Arabs, despite this have been attempting to convince the third world consumers that they are the champions of the new economic order. At a meeting in the U.N. the late Houari Boumedienne of Algeria called third world primary producers to form their own Cartel for their coffee, iron, bauxite, and copper (see the seven sisters: P 354-6). The Arabs took over a’’Cartel” already set up by the seven oil companies in the world (Exxon, Gulf, Mobil, Socal, Texaco, British Petroleum - BP. The Royal Dutch Shell) with a market allocation system well established, but who can.do this for the primary producers? This also begs the question how legal it is to form Cartels for the worlds most needed commodities. Such an action destined to wreck the economies of the countries in the world is contrary to the U.N Charter on declaration on principles of International Law concerning friendly relations and cooperation among states 1970.