Does OPEC Really Control the Price of Oil?
In spite of the best-laid plans of the Saudi oil empire, the price of crude oil cannot easily be manipulated to exorbitant levels. There are far too many oil producers, insufficient restrictions to free trade and far too many promising energy alternatives to allow Americans and others to be hindered by oil hording. The Organization of Petroleum Exporting Countries (OPEC), an eleven-country group of which Saudi Arabia is a member, controls two thirds of world petroleum exports. Despite the fact that five countries with very large oil reserves (Saudi Arabia, Iraq, United Arab Emirates, Kuwait and Iran) are OPEC members, their power is not all pervasive. The six or so non-OPEC oil producing countries (including Russia, which rivals or exceeds the Saudi production) often produce and sell more oil than OPEC suggests, which keeps prices far below the highs of the seventies, and sometimes below OPEC’s preferred floor of $20 per barrel. Reuters reported that U.S. Treasury Secretary Paul O’Neil
