Friday, January 16, 2015

Why is OPEC important to the price of crude oil?

Major crude oil producers
The first thing people need to know about crude is the producers. The major crude oil producers these days are Russia, Saudi Arabia, and the United States. The top ten oil-producing countries hold a market share of ~64% of crude oil production in the world.
The fall in crude oil prices impacts all the oil producers in these countries. Crude oil prices directly impact the revenue of US oil producers such as ConocoPhillips (COP), Anadarko Petroleum (APC), Apache Corporation (APA), and Pioneer Natural Resources (PXD). These companies are all part of energy ETFs such as the Energy Select Sector SPDR (XLE). Crude oil prices also affect the revenue of Saudi Aramco, Saudi Arabia’s largest oil company, Gazprom in Russia.
 
Organization of the Petroleum Exporting Countries (or OPEC)
Iran, Iraq, Syria, Kuwait, Saudi Arabia, Bahrain, Qatar, the United Arab Emirates (or UAE), Oman, and Yemen are members of the Organization of the Petroleum Exporting Countries (or OPEC). OPEC was formed in 1960. OPEC countries produce 40% of the world’s crude oil.
Seven sisters
Between 1940 and 1970, the following seven major oil companies dominated the oil market:



Read more:
http://finance.yahoo.com/news/why-opec-important-price-crude-214216533.html
 

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