OPEC not complying under the WTO Term Paper Example | Topics and Well Written Essays - 5000 words

OPEC not complying under the WTO - Term Paper Example According to documents of the organization, the most important aim of the OPEC is to create the co-ordination of diverse petroleum policies as well as unification and diversification of different petroleum policies along with the member countries and also to set the determination of the most ideal means for preserving their interests, both individually as well as collectively.2 Also these policies and strategies have been established by the organization to create the need for securing a steady stream of income for these oil-producing countries.3 This steady level of income is also expected to produce an efficient economic as well as regulatory supply of oil and petroleum to consuming nations all over the world and a fair return of profit on their capital accumulation to those countries which are investing in petroleum industries of these nations.4In addition to this, OPEC has also suggested to ensure the aim of stabilization of prices of oil in global as well as nationwide oil market s. OPEC assumed a ‘Declaratory Statement of Petroleum Policy in Member Countries’ where it established â€Å"the inalienable right of all countries to exercise permanent sovereignty over their natural resources in the interest of their national development. Membership grew to ten by 1969†5 This policy has been established by the organization with a view regarding elimination of harmful as well as unnecessary fluctuations.6 Currently, OPEC’s membership is consisted of the eleven countries which are: â€Å"Iran, Iraq, Kuwait, Saudi Arabia, Venezuela, Qatar, Indonesia, Libya, United Arab Emirates (UAE), Algeria and Nigeria†.7 The first five nations are regarded as Founder Members, and the rest are recognized as Full Members (which have joined the OPEC between the time period of 1961 and 1971). In the year 1992, OPEC comprised thirteen nations as constituents. These included both Ecuador as well as Gabon.8 Pursuant to Statute of the OPEC, nations can be come Full Members under the condition that these nations have a substantial amount of net exports of crude oil or petroleum and also possess alike interests to the member nations. For the purpose of obtaining membership of the organization, a country needs to be accepted by a majority number of 3/4 of the Full Members which include the agreement of all the five Founder Members.9 Under the â€Å"Uruguay Round Agreements†10, it has been suggested by the WTO that members are not allowed to impose export quotas on oil. Hence, while OPEC is an organization based on single product, WTO is a multilateral unit with a larger membership.11 Along with this, the OPEC’s policies in regard to price manipulation have been regarded as one of several most important factors in regard the strategy of establishing high gas prices in last few years. The amounts of this high gas prices are now comprised of average near about $2.20 per gallon.12 United States Senator Frank. R. Lautenberg in an official meeting commented that, â€Å"If you are part of a monopoly like OPEC you cannot belong to the World Trade Organization, which offers all kinds of commercial benefits.†13 On 8th July 2004 a report with the title ‘Busting Up the Cartel: The WTO Case Against OPEC’ was published from the office of the senator Frank Lautenberg in which